Industry minister Shoichi Nakagawa criticized the Industrial Revitalization Corp. of Japan on Friday for urging Daiei Inc. to decide by early next week whether to seek the government-backed entity’s help in its rehabilitation.
“The public entity should not take such action,” Nakagawa, minister of economy, trade and industry, told a news conference in which he made public the IRCJ’s letter of ultimatum to the struggling supermarket chain.
According to the letter dated Wednesday, the IRCJ urged Daiei to stop selecting sponsors by itself and to let the IRCJ take the lead in the selection. It told Daiei to decide by Tuesday.
The letter also urged that the retailer conclude a confidentiality contract with the IRCJ so it can assess the quality of Daiei’s assets on a full scale immediately. The IRCJ needs to decide by the end of March whether to purchase Daiei’s loans.
Nakagawa emphasized the need for Daiei to make a decision after examining conclusions to be made by private-sector businesses, saying, “A group of private entities is now assessing the quality of Daiei’s assets on the assumption that it can rehabilitate itself.”
Daiei President Kunio Takagi and UFJ Bank President Takamune Okihara met Friday to discuss the course of rehabilitating the ailing retail chain. UFJ Bank is one of the major creditors of Daiei.
Before going to the meeting, Takagi told reporters he had “no thoughts” of using the IRCJ. The company will get back on its feet “on a private-sector basis,” he said.
At the meeting, Okihara again pressed Takagi to turn to the IRCJ for help, saying the bank would provide some 400 billion yen worth of financial assistance only if the retailer will work with the IRCJ, a UFJ source said. Takagi apparently spurned the offer, the source said.
If Daiei continues to refuse, the three main creditor banks may demand Takagi’s resignation, they said.
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