Beleaguered Otsuka Kagu Faces Deeper Uncertainty

August 9, 2018

Tokyo- Uncertainty has deepened over Japan's Otsuka Kagu Ltd. as electronics retailer Yodobashi Camera Co. decided not to support the reconstruction of the beleaguered furniture seller.

Otsuka Kagu, whose sales have dropped amid a feud in the founding family, is looking for a company that will support its turnaround.

Yodobashi Camera was one of the two candidates to support the rehabilitation. But the company has shown its intention not to become a rehabilitation sponsor, informed sources said.

Otsuka Kagu is expected to negotiate with the other candidate, TKP Corp.. TKP, a meeting room rental service company, is in a capital and business alliance with Otsuka Kagu since November last year.

But the two sides are believed to be apart over the terms of assistance, the sources said.

Even if TKP injects fresh capital into Otsuka Kagu and take its control, "there would be no change in the situation in which the mainstay (furniture) business is unprofitable," a source said.

In a statement released Wednesday, Otsuka Kagu denied that reconstruction support candidates have not been narrowed to TKP.

The furniture retailer is examining various options, the statement said. Jiji Press