Struggling supermarket chain Daiei Inc. said Wednesday it will sell four hotels to Goldman Sachs Group Inc. of the United States for 45.4 billion yen. It also said it is also considering selling Fukuoka Dome.

Daiei will sell its stakes in Shin-Urayasu Oriental Hotel located in Urayasu, Chiba Prefecture, Kobe Meriken Park Oriental Hotel in Hyogo Prefecture, Namba Oriental Hotel in Osaka and Hotel Centraza Hakata in the city of Fukuoka.

The Goldman Sachs Group is making the purchases through Tokyo-based TN Development Co., its wholly owned hotel business arm. Daiei signed a contract Wednesday on the deal and expects it to be settled by the end of February.

The sales were made as part of Daiei’s three-year business reconstruction program, which runs through the 2004 business year, aimed at selecting and concentrating Daiei group business assets into mainstay retail and peripheral businesses, it said.

Under the program, Daiei plans to reduce its interest-bearing debts — which stood at 1.23 trillion yen at the end of last August — to 1.21 trillion yen by the end of February, the end of the company’s 2002 business year, the sources said.

A new three-year business reconstruction program unveiled by Daiei last February calls for the amount of its interest-bearing debts, excluding those held by a group credit card company, to be cut to 900 billion yen by the end of February 2005.

Daiei also operates three other hotels, two of which it has decided to dispose of, sources said. The hotels to be sold are Shinkobe Oriental Hotel and Seishin Oriental Hotel, both located in Hyogo Prefecture.

The company is also studying the possibility of selling the remaining hotel — Seahawk Hotel & Resort in Fukuoka — together with the adjacent Fukuoka Dome baseball stadium, the sources said.

Daiei has sounded out several firms on the proposed sale of the resort hotel and the ballpark home of the Fukuoka Daiei Hawks, they said.

The sale is apparently aimed at cutting the combined 130 billion yen in debts held by the two leisure facilities.

A Daiei spokesman said the company has yet to decide on the sale of the Seahawk Hotel and ballpark. “We are studying various options as part of efforts to restructure the two facilities,” he said.

Sumitomo Mitsui buy

Sumitomo Mitsui Financial Group Inc. said Wednesday it will issue preferred shares worth 150.3 billion yen next month, all of which will be purchased by U.S. investment bank Goldman Sachs Group Inc.

The move is intended to bolster the financial strength and risk-control ability of Sumitomo Mitsui Financial Group, the holding company said in a statement.

The company said proceeds from the share sale will be used to purchase new common shares to be issued by Sumitomo Mitsui Banking Corp., the core of the financial group.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.