Limping retailer Daiei Inc. announced Friday the outline of a new three-year restructuring plan that includes cutting 6,000 jobs, closing 50 unprofitable stores and asking its main banks for a 420 billion yen bailout.

Daiei President Kunio Takagi said the three creditors -- UFJ Holdings Inc., Sumitomo Mitsui Banking Corp. and Fuji Bank -- agreed to retire 120 billion yen in preferred shares that were purchased in 2001, swap outstanding loans for equity and waive still more loans.

The debt swap and debt forgiveness will erase 300 billion yen in loans.

Daiei will also reduce its common shares by 50 percent after seeking approval at its shareholders meeting in May.

The rescue package is expected to enable Daiei to reduce its interest-bearing group debts from 1.75 trillion yen, excluding those at credit card issuer Daiei OMC Inc., to less than 1 trillion yen by the end of February 2005, Takagi said.

To facilitate the bailout, Daiei and the three lenders will consider making an application under the Law on Special Measures for Industrial Revitalization, which enables companies to swap debt for equity, use tax incentives to spin off unprofitable businesses and obtain low-interest financing from the government-affiliated Development Bank of Japan.

Daiei's rescue comes after some heavily indebted companies, including supermarket chain operator Mycal Corp. and general contractor Aoki Corp., have been allowed to go bankrupt.

Market analysts have been speculating that the three banks' exposure to Daiei is so vast that failing to hammer out a bailout package could have threatened their own solvency.

Other observers say a Daiei failure would have rippled through the rest of Japan's shaky economy, causing wholesalers, manufacturers and creditors to fall into critical situations.

Takagi said his responsibility is to carry out the restructuring plan, which covers three years from March 1, and make Daiei a newly born retail group.

Isao Nakauchi, who founded Daiei in Osaka in 1957, will give up his retirement allowances, worth about 2 billion yen, and retire from the board of directors at the group companies, Takagi said.

The stores to be closed include about 30 Hyper Mart discount outlets, Kou's paid-membership warehouse club stores and some 20 unprofitable Daiei supermarkets.

According to the restructuring plan, the retail giant will sell assets and businesses that are not related to its core business, including Recruit Co. shares and food service affiliates.

As a result, the number of Daiei group firms will be reduced from the 150 as of February to less than 100 by February 2005, Takagi said.

A major source of speculation the past week has been what the banks would force Daiei to do with its loss-making baseball team, The Fukuoka Daiei Hawks, their home, the Fukuoka Dome, and the adjacent Sea Hawk Hotel & Resort.

Daiei will keep a 60 percent stake in the baseball team, while the plans are to securitize the indebted stadium and resort complex.

By carrying out the program, Daiei expects to post 30 billion yen in consolidated net profits and 54 billion yen in consolidated pretax profits in February 2005.

Despite the bailout, some analysts have expressed doubts about Daiei's future.

Tomoo Noguchi, a marketing professor at Waseda University, said the key to Daiei's survival is whether the retailer can attract more consumers.

"As Daiei sells off profitable group businesses to reduce debts, it needs to create profitability from its core business," he said. "Daiei's revival would be difficult unless the company makes its stores more attractive by increasing value-added products and renovating its outlets."