Feb 20 (Nikkei) - The former chairman of Sekisui House was ousted after his attempt to remove a sitting president over a land scam backfired, resulting in a stunning boardroom coup by his protege, The Nikkei has learned.
The developer announced Jan. 24 that then-Chairman Isami Wada would step aside for Toshinori Abe, then president and chief operating officer, effective Feb. 1 -- a move the company called a "change of generation" meant to pave the way for "continuous growth." Yoshihiro Nakai, then managing director, has stepped up as the company's new president.
It now appears, however, that the transition was far from the routine affair that Sekisui House has presented. Rather than resign of his own accord, Wada was apparently forced out after his attempt to hold Abe accountable for the botched land deal, which cost the company more than $50 million. At the Jan. 24 press conference, Nakai flatly denied any link between the personnel change and the land scam. Abe did not respond at that conference when asked about the connection between the two events.
The deal in question concerned 2,000 sq. meters in Tokyo's Gotanda section on which Sekisui House intended to build condominiums. The builder negotiated to buy the property from a middleman purporting to have signed a tentative purchase agreement with the land's owner. When Sekisui House paid its 6.3 billion yen ($59.1 million) and sought to obtain the deed to the property, however, its application was rejected: Critical documents from the supposed seller had been falsified. When the fraud was discovered, the culprits could not be reached.
Sekisui House announced the details of the incident in August, and booked a 5.5 billion-yen extraordinary loss in the February-July half related to the deal. It also convened a panel of outside auditors and directors to look into how the fraud had transpired and determine who at the company bore responsibility.
The results of that investigation were reported on Jan. 24. When the board of directors met at 2 p.m. that day, Wada opened with an explosive resolution calling for Abe's dismissal as president, as the investigators' report had pinned "heavy responsibility" for the fraudulent deal on those in charge of operations.
