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Saturday, Nov. 1, 2003
IRCJ to have another crack at Mitsui Mining
By TOMOKO OTAKE
The Industrial Revitalization Corp. of Japan announced Friday it will bail out Mitsui Mining Co. after all, saying the firm's revised restructuring plan can work.
The state-backed body said that questions raised over the company's viability have been cleared up.
The IRCJ decided to endorse the mining company on Sept. 1, only to reverse its decision at the end of that month after claiming Mitsui Mining had underestimated its costs and losses in its balance sheets.
Appraisal losses and added costs -- now reflected in the revised version of the company's restructuring plan -- total 9.5 billion yen, the IRCJ said. The firm has a chance of surviving despite the newly found losses, it said.
IRCJ President Atsushi Saito denied allegations that Mitsui Mining had window-dressed its books in an initial restructuring plan.
"We examined the firm pretty intensely" over the past month, Saito said. "The mistakes 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 20 billion yen worth of new shares that will be issued by the firm. Sumitomo Mitsui Banking Corp., the company's main creditor, will buy new shares worth 27 billion yen.
The IRCJ and SMBC will jointly seek secondary banks to forgive a total of 165.8 billion yen in outstanding loans extended to Mitsui Mining, IRCJ officials said.