Japan-based retailer Seven & i Holdings intends to keep the roughly 5,000 workers at its loss-making department store Sogo & Seibu employed even after the unit's planned sale, the Nikkei business daily has reported.
Seven & i, operator of the world's largest convenience store chain, last year reached an agreement to sell Sogo & Seibu to US fund Fortress Investment Group, but the deal has been on hold as it received flak from workers.
The company will sell the unit on 1 September, triggering a plan for a walk-out at a flagship store in what would be Japan's first major strike in decades, Reuters reported earlier, citing a source familiar with the matter.
A workers union intends to carry out its threat for a strike at the flagship Seibu Ikebukuro store in Tokyo on Thursday (31 August), according to a union member, Reuters reported.
Sogo & Seibu
Once the transaction is complete, the company has decided to work with Fortress to maintain the employment of the workers, including the provision of transferring employees within Sogo & Seibu or to another unit, the Nikkei stated, adding that the company has already requested cooperation from Fortress.
Seven & i will nullify around 90 billion yen (€560 million) of the 160 billion yen (€1 billion) it has lent to Sogo & Seibu to lure assistance with the latter's restructuring, according to the Nikkei.
In June of this year, Seven & i Holdings reported a nearly 20% fall in first-quarter operating profit.
Profit fell to 81.99 billion yen (€530 million) for the three months ended 31 May, from 102.37 billion yen (€660 million) in same period a year earlier.
