Scandal-tainted Kokudo Corp. has decided to sell the Seibu Lions baseball team for more than 20 billion yen, sources said Saturday.
The development came as the financial profile of the operator of the Prince Hotel chain and various sports facilities is deteriorating due to a recent plunge in group firm Seibu Railway Co. shares, the sources said.
The plunge is the result of a scandal in which Kokudo provided false information about its stake in the railroad operator.
Kokudo, an unlisted firm, has already approached several potential buyers, including Internet service provider Livedoor Co., whose bid to join pro baseball next season ended in failure last week, the sources said.
Seibu Lions Inc. is a wholly owned unit of Kokudo.
It is unclear whether Kokudo will be able to sell the ballclub at an early date because some of the companies that Kokudo has sounded out turned down the offer, the sources said.
The companies are cautious as Kokudo’s offer is unaffordable amid the outlook that running the team would incur an annual deficit of several billion yen, the sources said.
Kokudo is hoping the new owner will continue to use the Seibu Dome in Tokorozawa, Saitama Prefecture, as the team’s home stadium, they said, adding it will keep the club next season unless negotiations with potential buyers are concluded.
The Lions play in the Pacific League. Last month they won their first Japan Series title in 12 years, beating the Chunichi Dragons of the Central League.
Kokudo Chairman Yoshiaki Tsutsumi resigned Oct. 13 from all his posts in the company and in Seibu Railway group firms in connection with the scandal.
Kokudo President Minoru Mikami is expected to resign to take responsibility for the scandal after the Tokyo Stock Exchange and financial regulators end their investigations into falsification by Kokudo and Seibu Railway of their financial statements and shady sales of Kokudo’s shareholdings in the railway operator.
The scandal deepened after it was found that Kokudo sold some of its shares in Seibu Railway without telling buyers the railway firm’s stock ownership conditions made it subject to delisting.
Some of the purchasers, most of them major companies, have asked Kokudo to buy back the shares, which they bought before Kokudo announced it had underreported its shareholdings in the railway firm.
The TSE has been looking into whether it will delist Seibu Railway from its first section after it placed Seibu Railway shares on a monitoring post following the announcement.
The Securities and Exchange Surveillance Commission is also investigating Kokudo for possible insider trading in connection with the sales of Seibu Railway shares.
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