Decision and Details
Board of DirectorsFiling for commencement of corporate reorganization proceedings, the order commencing such proceedings, and the presentation of a reorganization plan, etc.
The accounting scandal at a subsidiary, the disclaimer of opinion in the audit report, the need to improve the internal control system, the designation as a Security on Special Alert, breaches of covenants under borrowing agreements resulting from corrections to the financial results, and the request to financial institutions for a deferral of principal repayments. The company is pursuing stable reconstruction while preventing impairment of its business value.
The company will pursue reconstruction through corporate reorganization proceedings. Revisions to the earnings forecast and the specific amount of the impact on profit or loss have not been disclosed. The company intends to pay trade creditors in accordance with the existing terms without applying any debt haircut.
| Item | Details |
|---|---|
| Matter Covered | Filing for commencement of corporate reorganization proceedings, the order commencing such proceedings, and the presentation of a reorganization plan, etc. |
| Decision-Making Body | Board of Directors |
| Decision Date | 8 May 2026 (resolution date, filing date, and date of the commencement order) |
| Implementation Date | 8 May 2026 (the commencement order for corporate reorganization proceedings and the appointment of the trustee have occurred) |
| Period Covered | Period of the corporate reorganization proceedings (end date not disclosed) |
| Amount | Total liabilities: ¥15,991 million (on a standalone basis as of 30 April 2025) |
| Quantity / scale | Total number of issued common shares: 6,536,800; number of employees: 40; total number of shareholders: 8,670 |
| Impact on Business Performance | The company will pursue reconstruction through corporate reorganization proceedings. Revisions to the earnings forecast and the specific amount of the impact on profit or loss have not been disclosed. The company intends to pay trade creditors in accordance with the existing terms without applying any debt haircut. |
| Reason | The accounting scandal at a subsidiary, the disclaimer of opinion in the audit report, the need to improve the internal control system, the designation as a Security on Special Alert, breaches of covenants under borrowing agreements resulting from corrections to the financial results, and the request to financial institutions for a deferral of principal repayments. The company is pursuing stable reconstruction while preventing impairment of its business value. |
| Governing Rule | Corporate Reorganization Act; Article 84(1) of the Corporate Reorganization Act; proviso to Article 601(1)(iii) of the Securities Listing Regulations; Article 601(3)(iii) of the Enforcement Regulations thereof; and Article 603(1) of the Securities Listing Regulations |
| Related previous disclosures | 14 February 2025: “Notice concerning the submission of correction reports for prior-period securities reports, etc., and corrections to prior-period earnings releases”; 9 May 2025: “Notice concerning the establishment of an independent committee” |
| Future plans | Period for submitting opinions on the appointment of the trustee: 29 May 2026. Deadline for submission of the trustee’s report and period for filing reorganization claims, etc.: 8 July 2026. Deadline for submitting statements of approval or disapproval: 7 August 2026. General investigation period for reorganization claims, etc.: 14 to 20 August 2026. Deadline for submitting the reorganization plan: 31 August 2026 for interested parties and 7 September 2026 for the trustee. The schedule may be changed. |
The reasons the company gives
The company's own explanation, not something inferred from the numbers.An accounting scandal at a subsidiary resulted in a disclaimer of opinion in the audit report, creating a need to improve the internal control system. The company was designated as a Security on Special Alert, and corrections to its financial results caused breaches of covenants under its borrowing agreements with financial institutions, leaving it in a position to request a deferral of principal repayments. The company stated that it would use corporate reorganization proceedings to pursue a stable reconstruction while preventing impairment of its business value.