Misawa Homes Co. said Friday it has asked UFJ Bank to forgive 35 billion yen in loans and purchase 35 billion yen of its preferred shares in line with a new restructuring program.
The program also calls on Misawa, the nation's third-largest prefabricated home builder, to lay off 2,000 of its 11,000 employees on a group basis and to promote consolidation and liquidation of loss-making subsidiaries by the end of March 2006.
Misawa said it will write off 122 billion yen in latent losses on property-backed loans, property assets and shareholdings in the current business year, which ends March 31.
Misawa also said it plans to cut its consolidated interest-bearing liabilities to 270 billion yen by the end of March 2006. Such liabilities totaled 600 billion yen as of the end of September.
Misawa said it now forecasts a consolidated net loss of 18 billion yen in the current business year, much higher than the 3.5 billion yen loss the company projected in November.
It did not change its projections for group sales of 500 billion yen and pretax profit of 15 billion yen.
On an unconsolidated basis, the company expects a net loss of 26.4 billion yen, a sharp reversal from the earlier projected net profit of 2 billion yen.
The company left unchanged its projections for unconsolidated sales of 200 billion yen and pretax profit of 12 billion yen.