Goodwill Group Inc., the parent of scandal-hit nursing care provider Comsn Inc., said Monday it would withdraw completely from the sector and leave the business assets of the industry’s top player up for grabs.
Goodwill’s other nursing business subsidiaries, including NSS Corp., which was tapped last week as the successor to Comsn’s business in an ill-conceived plan, are also expected to be sold. However, Goodwill did not specify the timing of its withdrawal, saying it depends on how the sale of its nursing care businesses proceeds.
The rising public uproar over Comsn’s alleged certification fraud represents a remarkable fall from grace for Goodwill Chairman Masahiro Origuchi, who made a sensational debut in the nursing care business in 1997 after running Tokyo’s hottest night club earlier in the decade. He now retreats from one of Japan’s most rapidly growing business areas.
The battle for the remains of the industry’s top player is likely to create more competition and opportunities in nursing care, as well as more public concern about who is going to replace Comsn and the reliability of its service, industry watchers said.
Other companies, both veterans and newcomers to nursing care, have shown interest in absorbing Comsn. Major pub chain Watami Co. and welfare service Nichii Gakkan Co. both said earlier Monday they are willing to acquire Comsn.
Watami has told several financial institutions who could be in a position to mediate the deal that it would consider taking over Comsn’s nursing home business if parent company Goodwill Group Inc. formally requests it, sources said.
Watami runs a large chain of “izakaya” (Japanese-style pubs) in the Kanto region as well as the Western-style pub chain T.G.I. Friday’s.
It said it wants to acquire Comsn’s operations “to dispel any fears the nursing centers’ residents may have as well as Comsn employees, and not with the aim of expanding our business,” a company representative said.
Watami is already in the nursing care business through Watami Medical Service Co., which was established in April 2004, and took over another firm that runs homes for the aged in the Tokyo area in March 2005.
It now has a chain of 27 nursing homes in and around Tokyo.
Nichii Gakkan has indicated its own interest in Comsn’s at-home nursing care business.
“We hope to offer as much support as possible by working with local authorities,” a Nichii Gakkan official said.
The Health, Labor and Welfare Ministry said last week it would terminate the operating licenses of nearly 80 percent of the nursing care-related facilities run by Comsn.
The firm obtained some of the licenses for nursing care service operators certified under a public insurance program through fraudulent applications, including those with an inflated number of employees, the ministry said.
The scandal has become a big social problem because the termination of the licenses would affect around 1,600 facilities nationwide believed to be serving some 60,000 elderly people.
Comsn operates about 2,000 nursing service-related facilities nationwide, of which about 30 are homes for the aged.
Its at-home nursing care business is the biggest in Japan.
Goodwill Chairman Origuchi told reporters last weekend that the group will prioritize transferring the entire business of Comsn together with its 24,000-strong workforce.
“But if selling off Comsn in its entirety proves impossible, we will consider breaking up its operations and handing them over in parts,” he added.
Goodwill planned to shift Comsn’s operations to one of its group firms after the ministry’s decided to terminate the operating licenses of most of Comsn’s nursing care facilities.
But Goodwill was forced to freeze the plan, which was criticized as an attempt to dodge government punishment.
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