Urban Corp, the real estate developer that became Japan’s biggest bankruptcy this year, will sell off two of its businesses and liquidate after failing to attract final bids from investors.
Urban will sell its residential business to its main creditor Hiroshima Bank Ltd and a bank affiliate, according to a release on the company’s website yesterday. Its securitisation business will be sold to Kyokuto Securities Co and Chuo Mitsui Trust Holdings Inc. After the sale, the Hiroshima- based company will be liquidated.
A slump in Japan’s property market has forced 25 publicly listed developers and construction companies to file for bankruptcy. Dia Kensetsu Co, a Japanese condominium developer, became the latest casualty, filing for bankruptcy on Dec 19 with 30 billion yen (S$483 million) in liabilities.
‘It highlights the dim prospect for the property market,’ said Junko Miyakawa, a senior analyst at Shinsei Securities Co. ‘People anticipate that property prices in the next few years will deteriorate further.’
Daiwa House Industry Co, Japan’s biggest home builder, Goldman Sachs Group Inc and Merrill Lynch & Co, which were interested in Urban’s assets, didn’t take part in the bidding on Dec 19 because most of the company’s well-located sites in Tokyo had been sold off and they didn’t want Urban’s remaining staff, said two people familiar with situation.
Urban filed for protection from creditors on Aug 13, citing 255.8 billion yen of debt, the largest bankruptcy among listed companies in Japan this year.
Tokyo District Court started a rehabilitation process on Aug 18 for assets that were valued in June at more than 477 billion yen.
Source : Business Times - 23 Dec 2008
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