Daiei Inc. President Kunio Takagi has decided to step down after ongoing rehabilitation talks between the ailing retailer and its three main banks are completed, informed sources said Monday.
Takagi is apparently ready to take responsibility for causing Daiei’s business slump and for driving the retail giant deep into debt, the sources said.
Negotiations between Daiei and the lenders have entered a final stage, with Daiei pondering whether to accept the banks’ proposal that assistance be sought from the Industrial Revitalization Corp. of Japan.
Late last week, Daiei presented UFJ Bank, Mizuho Corporate Bank and Sumitomo Mitsui Banking Corp. with a new plan aimed at turning its business around without help from the IRCJ.
Takagi will meet top bank executives this week to persuade them to accept the plan. The three banks are collectively pushing the retailer to accept assistance from the IRCJ.
The Daiei plan advocates raising 100 billion yen by issuing shares to securities houses and investment funds both at home and abroad.
It also states that major trading house Marubeni Corp. will assist in the rehabilitation efforts.
The creditor banks view the new plan as inadequate and continue to push for the IRCJ’s involvement.
The IRCJ is charged with helping to revive heavily indebted companies deemed otherwise salvageable by buying loans extended to them from banks.
Hideji Sugiyama, vice minister of economy, trade and industry, said the ministry has no intention of joining the monthlong negotiations because “it is best for parties concerned to discuss details” of the revival plan.
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