The economy, trade and industry vice minister on Thursday called on troubled Daiei Inc. to compile an effective new restructuring plan as it concurrently seeks a bailout to avert a financial crisis in March.

"We will take macroeconomic measures steadily, but at the same time there is a need to pay close attention to individual cases," Katsusada Hirose said. "From that viewpoint, I have great interest in Daiei's new three-year plan and expect it to be effective."

The top industry ministry bureaucrat urged the updating of Daiei's revival plan, initially announced in 2000, to be quickly carried out in a way to regain market confidence.

Daiei, struggling under the weight of 2.3 trillion yen in interest-bearing group debts, is in final talks with its four main creditor banks on a new bailout package, which includes several tens of billions of yen in fresh financial help, industry sources said Wednesday.

They said Daiei is eyeing a new three-year restructuring plan centering on paying its debts more quickly, receiving massive amounts of money to improve its financial health, and closing dozens of unprofitable shops to restore the group's earning capacity.

S&P cuts Daiei rating

Standard & Poor's Corp. said Thursday it has lowered its corporate credit rating on Daiei Inc. to CCC-minus-pi from CCC-plus-pi.

The downgrade follows media reports that the supermarket chain's major lenders are considering some form of loan forgiveness, debt-for-equity swap or both, the leading U.S. credit-rating agency said.

S&P believes Daiei's current large debt burden is not sustainable over the longer term without a significant restructuring of its capital structure, given the weak recovery in its earnings base.

The rating will be lowered to CCpi if Daiei and its major creditors reach an agreement on debt forgiveness in the coming month, S&P said.

The rating agency considers debt forgiveness or any form of capital restructuring to be a form of selective default, even if the issuer continues to make timely payments on its other obligations.