Telecommunications venture firm Heisei Denden Co. said Monday it has filed for bankruptcy protection from creditors, with debts reaching some 120 billion yen as of the end of September.

The company said it filed for court-mandated rehabilitation under the fast-track Civil Rehabilitation Law at the Tokyo District Court.

Heisei Denden, set up in July 1990, is known for its Chokka cut-rate fixed-phone service and had been at the forefront of industry efforts to reduce rates.

However, it fell into dire straits as larger telecom firms muscled in with similar services and aggravated the discount war.

Chokka has roughly 150,000 subscribers, and company officials said they will continue to offer service.

Heisei Denden began offering telephone services in 2001. It later positioned its Denko Sekka ADSL service as the main pillar of its operations and saw subscriptions grow as it touted low rates.

In July 2003, after the Internal Affairs and Communications Ministry said it would allow Nippon Telegraph and Telephone to hike the interconnection fees it charges other carriers for access to its lines, Heisei Denden launched Chokka, which cut rates on calls using fixed-line phones by offering low interconnection fees.

In the year to last January, it logged sales of 44 billion yen.

Heisei Denden has its roots in a real estate firm that was established in the city of Fukuoka in 1990. Denden said that while it had spent huge amounts on capital investments, another factor in its inability to increase subscribers was the complex process of getting connections with NTT lines.