Financial news

Japan workers strike over sale of Seibu to US investment group – JURIST

On Thursday, Japan witnessed its first labor strike in six decades. The catalyst for this strike was the sale of the Seibu department store, a subsidiary of the Japanese retail giant Seven & i, to the US-based Fortress Investment Group. Workers’ concerns primarily revolve around the possibility of job cuts and the need for assurances regarding job security and the continuity of business operations, which ultimately led to a one-day strike.Ryuichi Isaka, the President of Seven & i, publicly expressed his regrets on Thursday, acknowledging the disruptions caused to customers and stakeholders. Still, despite this apology, media reports indicated that during their Thursday meeting, the company’s board opted to proceed with the sale to Fortress, a decision carrying substantial consequences for both the company and its workforce. This was later clarified by a statement released on the website of Seven & i, stating that they are continuing to “engage in dialogue with our stakeholders to form a consensus as soon as possible to carry out this transfer, but nothing has been decided at this time regarding the media report.”The strike is the culmination of a protracted dispute that has unfolded over several months between the Sogo & Seibu labor union and the management of Seven & i. The company has faced sustained pressure from ValueAct, an activist investor based in the United States, urging it to divest from non-core businesses.Union Chief Yasuhiro Teraoka emphasized, “the union is not convinced if the sale plan is based on business continuity and ensuring the preservation of workers’ jobs.” Following the acquisition, Fortress is slated to sell Sogo & Seibu assets for nearly 300 billion yen ($2.06 billion) to utilize the proceeds to repay loans obtained for the purchase.