OSAKA -- Daisue Construction Co. said Tuesday that it will ask Sanwa Bank and other creditor institutions to waive about 64 billion yen in loans they issued to the contractor.
Sanwa Bank later confirmed it had received and was considering the debt-forgiveness request. The bank provided some 62 billion yen of the loans.
The medium-size Osaka-based general contractor said its request is aimed at recovering earnings amid a sluggish condominium market.
If the loans are waived, Daisue's interest-bearing liabilities would fall to 30 billion yen or less, the company said.
Daisue will also halve its 7.7 billion yen capital and allocate about 2 billion yen worth of new shares to third parties, including trading house Nichimen Corp.
After the third-party allocation, Nichimen would become Daisue's largest shareholder, with an 11.23 percent stake.
Daisue's problems are largely due to its failed golf course developments. The company has since been carrying out rehabilitation efforts with the backing of Sanwa Bank.