Former Seibu Railway Co. President Hiroyuki Toda admitted in a document filed Thursday with the Tokyo District Court that he was just a “nominal” shareholder in Kokudo Corp., a core member of the Seibu Railway group, sources said.
Toda said in the statement to the court that he is not an actual shareholder of Kokudo and that he had “no idea” to whom the stocks supposedly in his possession actually belong, the sources said.
The group plunged into a crisis when it was revealed that it had falsified financial statements on Kokudo’s shareholdings in Seibu Railway, which was subsequently delisted from the Tokyo Stock Exchange last December.
Kokudo’s management insists that Kokudo itself did not have such nominal shareholders. However, Toda and 13 other shareholders have so far submitted statements to the court claiming they do not consider themselves as real shareholders in Kokudo, according to the sources.
Toda and the others submitted the statements in response to an inquiry from the court dealing with a lawsuit filed against Kokudo’s management, including Toda, by Yuji Tsutsumi, a son of Seibu group founder Yasujiro Tsutsumi, who insisted that most of the outstanding Kokudo shares in fact belong to the Tsutsumi family.
Yuji Tsutsumi is the younger brother of former Kokudo Chairman Yoshiaki Tsutsumi, who is standing trial on charges of playing a leading role in making the false reports on Kokudo’s shareholdings in Seibu Railway and of insider trading in shares in the railway.
The younger Tsutsumi argues that many of the Kokudo shares had been distributed to nominal shareholders in a scheme devised by his father to avoid imposition of inheritance taxes.
The Seibu Railway group in August announced a reconstruction plan under which it will raise 160 billion yen in capital for a holding company that could be launched in February to own Seibu Railway and a hotel and resort company.
The hotel and resort company would be created by a merger between Prince Hotels Inc. and Kokudo.
The group intends to hold a shareholders’ meeting within this year to obtain approval for the reconstruction plan, but analysts say Toda’s and the 13 other Kokudo shareholders’ statements may adversely affect debate on the reconstruction plan.
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