Seibu Railway Co. said Tuesday four managing directors and three directors will resign next month over falsification of financial statements that was discovered last year.
The management changes, which include the appointment of a new director and the promotion of three directors to managing directors, are expected to be endorsed by shareholders at the firm's annual general meeting June 28, according to Seibu Railway.
The railway operator will pay no retirement benefits to the seven resigning board members.
Seibu Railway falsified stockholdings statements by underreporting equity holdings by major shareholders including Kokudo Corp., a privately held firm that effectively controls the Seibu conglomerate.
In May, Seibu Railway installed Takashi Goto, 56, a former Mizuho Corporate Bank vice president, as president and Naoki Hirano, 63, a former transport ministry bureaucrat and a former vice president of West Japan Railway Co., as chairman.
With the resignations announced Tuesday, the 15-member board will be reduced to six, as two other members having already resigned since last year's shareholders' meeting.
Seibu Railway will ask shareholders this month to approve changing the board's size to nine members and introducing a corporate officer system that would keep top management out of day-to-day operating decisions.