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Daiei unveils details of debt-for-equity swap deal.

TOKYO, July 15 Kyodo

Struggling retailer Daiei Inc. on Monday unveiled details of a debt-for-equity swap plan for its three main lenders, under which the banks would be partially given voting rights.

Under the plan, the banks -- UFJ Bank, Sumitomo Mitsui Banking Corp. and Mizuho Corporate Bank -- are to swap 220 billion yen in their combined loans for Daiei's preferred stock.

The debt-for-equity swap deal is part of a major restructuring program Daiei agreed with the creditor banks earlier this year.

Of the total preferred stock issues, 40 billion yen worth would have voting rights and could be converted into common stock after three or four years, Daiei said.

The other 130 billion yen worth would not immediately have voting rights but could be converted into common stock with voting rights after five to eight years. The stock, however, would receive higher dividends.

The remaining 50 billion yen would have no voting rights at all but receive the highest dividends.

Daiei will issue the preferred shares and allocate them to the three banks on Aug. 19, it said.
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Publication:Japan Weekly Monitor
Geographic Code:9JAPA
Date:Jul 22, 2002
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