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Seibu Group Eyes 160 Bil. Yen Equity Issue for Holding Firm

Posted on: Friday, 12 August 2005, 12:00 CDT

Aug. 12--TOKYO -- The Seibu Railway Co. group is considering raising 160 billion yen in capital for a holding company that could be launched in February 2006 to own Seibu Railway and a hotel and resort company, group sources said Friday.

Purchasers of the new equity shares could be investment funds, including foreign ones, they said.

On the strength of the enhanced capital base, they said, the holding company may seek to go public and list on a stock exchange.

The group plunged into a crisis when Seibu Railway was delisted from the Tokyo Stock Exchange last December because it had falsified financial statements.

The group may finalize the capital-raising plan within this month for approval by Seibu Railway shareholders, the sources said.

Seibu Railway said Wednesday the group would reconstruct itself under the holding company, scrapping an earlier plan for the railway firm to absorb Prince Hotels Inc. and Kokudo Corp., which has been the core of the group.

The hotel and resort company to be placed under the holding company will be created by a merger between Prince Hotels and Kokudo.

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Source: Kyodo News International, Tokyo

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