Mitsui to be rescued

JAPAN’S state-backed Industrial Revitalization Corp. of Japan (IRCJ) has confirmed that it will go ahead with backing the restructuring plan put forward by Mitsui Mining, which has a debt burden totaling Yen 304 billion.

Staff Reporter

IRCJ had originally indicated it would endorse the company in early September, later reversing the decision on claims Mitsui Mining had underestimated its costs and losses. The IRCJ later ordered Mitsui and its main bank Sumitomo Mitsui Banking Corp (SMBC) to resubmit the restructuring plan.

A revised version of the company's restructuring plan now reflects appraisal losses and added costs totalling Yen 9.5 billion.

IRCJ President Atsushi Saito told The Japan Times that the mistakes made in the initial restructuring plan were technical, not intentional.

Under the new plan, Mitsui Mining will either sell or withdraw from unprofitable operations such as cement manufacturing and designing water purity-control devices. Affiliates will be consolidated and idle real estate holdings will be sold off, the IRCJ said.

The IRCJ will acquire a majority stake in Mitsui Mining by buying Yen 20 billion worth of new shares that will be issued by the firm. SMBC, the company's main creditor, has agreed to forgive a total of Yen 42.5 billion in loans and will buy new shares worth Yen 27 billion.

The IRCJ and SMBC will jointly seek secondary banks to forgive a total of Yen 165.8 billion in outstanding loans extended to Mitsui Mining, IRCJ officials said.