OSAKA -- Ailing supermarket chain Mycal Corp. said Monday that it will sell 6.45 million shares in subsidiary Mycal Hokkaido Corp. to help slash its debt.
The sales, formally decided at the firm's extraordinary board meeting earlier in the day, would lower Mycal's stake in Mycal Hokkaido from 58.84 percent to 27.35 percent.
Although Mycal has not yet fixed the value and buyers of Mycal Hokkaido shares for the deal, it is negotiating with Mycal Hokkaido's business partners and investment firms for sales of the shares by the end of this month, the company said in a statement.
Mycal is in the final stage of negotiations with Sapporo-based Hokkaido Coca-Cola Bottling Co. and dozens of other firms for deals worth around 5 billion yen, industry sources said.
The Mycal group, saddled with 1.151 trillion yen in interest-bearing debts as of the end of February, aims to slash the amount to 910 billion yen by the end of this month.
The sales of shares in Mycal Hokkaido would remove it from Mycal's consolidated balance sheet, thereby removing 30.5 billion yen of interest-bearing debts held by the Hokkaido subsidiary.
In early August, Mycal Corp. said it would close 38 unprofitable outlets during the year that ends February.
Mycal Hokkaido, listed on the Tokyo Stock Exchange's first section, operates 20 stores in Hokkaido. Capitalized at 2.61 billion yen, it has 1,170 employees.