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Toyo Keizai: The Hyenas of the Market Close In

The Toyo Keizai has published another damning article about Nova. This article focuses more on the shady funds in the British Virgin Islands that Nova sold the equity warrants to. If the portrayal of the funds is accurate, they'll try and pump and dump Nova and leave it for dead. Here's a translation of the article.

With Nova on the brink, the hyenas of the market close in

Nova’s business is becoming increasingly chaotic. With late salaries the norm comes an announcement of a major cash injection. But in the background there are rumors of shady dealings with mysterious shell companies.

Business is becoming increasingly chaotic for major English conversation school Nova.

The August 25 edition (of the Tokyo Keizai) reported that there was no indication that Nova was going to clean up its act and improve its business even though it was late paying its business partners, and with the passage of payday on October 15, its foreign instructors have also not been paid. Tension is increasing day by day, and the General Union, to which the instructors belong, was compelled to visit the Labor Standards Inspection Office and file a complaint against president Nozomu Sahashi for violating the Labor Standards Law.

Nova’s crisis began in June when METI ordered it to suspend part of its business. Students found the long-term lesson contracts to be extremely disadvantageous. New student enrollment was on the decrease before METI’s administrative punishment and plummeted after METI’s announcement, which was followed by a flood of contract cancellations. Partner financial institutions refused new loans for Nova leaving it immediately squeezed for cash.

At the end of March, plans to close and merge its 925 schools seemed to be on track but this too, fell to pressure from financing. Nova’s largest financial asset are the lease deposits ( shikikin ) and security deposits ( hoshoukin) that come from opening schools, which, at the end of June, amounted to 15 billion yen. Vacating schools would return this money to Nova for it to put back into its operations. However, this is a double-edged sword as there are expenses that have to be paid when vacating schools.

The similarities with bankrupt Maruishi Cycle

Ultimately, the current state of Nova rests with Sahashi himself raising capital. He holds 48 million shares of Nova, a 72% stake in the company, but at least one third of those shares have been deposited as collateral.

According to one source, the 750 million yen corporate bond issued by Nova in August, too, was reportedly used as collateral in a stock loan with the president of a Tokyo consulting firm.

The truth is, there is a hidden reality behind this bond. Although the bond was to be redeemed in August of next year, it had a call option attached to it and was supposedly already in the period when the option could be exercised.

Shortly after three in the morning on October 10, Nova suddenly announced a private placement of equity warrants. It was a huge deal that, if all of the warrants were exercised, would raise 6.4 billion yen for Nova. But nobody was saying this plan would pull Nova from the brink of disaster. Apart from the unusual timing of the announcement, the mysterious firms who Sahashi made the deal with raised eyebrows.

Those firms are Rich Peninsula Trading Limited and Tower Sky Profits Limited, two funds located in the British Virgin Islands. Both of these funds made news two years ago with their involvement in financing companies in trouble, namely Ichiya and Union Holdings. Ichiya and Union Holdings were “problem companies” that were strapped for cash and engaged repeated rounds of equity financing that was excessive in relation to the size of their businesses, leaving them to bleed red ink for a number of years.

What is cause for concern is that the operators of shell companies registered in a tax haven are not known. According to one stock broker, Nishida Haruo, “a big fish,” arrested on October 12 by Osaka special investigators for manipulating the shares of Nanno Construction (now known as AC Holdings), was reportedly to have had a hand in Nova’s deal at one point.

Currently, the persons presumed to be the ringleaders in all this is an individual who entered Maruishi Cycle which went bankrupt three years ago due to the overissue of drafts, and another individual who caused massive losses for NFK Holdings by siphoning off funds to a venture investment business he controlled. The latter has close ties to Nishida and is connected with a separate venture capital business involved with Sahashi’s offering of shares as collateral in mid-September.

The equity warrants are to be issued on October 24. Nova’s share price is forecast to be below 35 yen, the price at which the warrants are to be exercised at, but given the events of the past, the mass exercise of warrants is nothing more than mucking around with the hyenas of the stock market. With Australia’s foreign minister expressing his concern, Nova’s crisis has the makings of an international problem of which the outcome is anybody’s guess.

Japan: 
nova
Eikaiwa: 
Naked Theft

Comments

I think it's time we stop posting articles. This shit is over and done with. Today was the day we were to get paid and yet once again we got the royal shaft.
The government doesn't give two shits about it's foreign community...it never has and never will. For those of you sitting on your asses waiting to collect unemployment, good luck cause your going to need it!

Hopefully there will be one of two articles posted next
- Nova goes bankrupt and people will finally realize noone is getting paid
- Some mindless investment group buys Nova and some people (Hopefully the newbies) will be able to continue working with pay.

If you hear this sound outside your branch tomorrow you know it will not be the yaki imo guy!!

It will definitely be time to excuse yourself from class as discretely as possible, return your Diplomat book and files to the teachers room, bid a quick "otsukaresama" to the remaining J Staff and get your ass on the next train, subway or bus going anywhere!

http://www.youtube.com/watch?v=dQ1vv3ypDaQ

You don't have to read this forum, and you don't have to read every posting.

I for one really appreciate the information provided by this site, and while i do (did?) work for Nova, I'm not sitting on my arse waiting to collect unemployment. I can't understand your rationale for articles not being posted? You are against freedom of information? Speech? It hurts your feelings?
Knowledge is power, by providing this information it lets anyone that reads it make a more informed decision regarding their own future.

And yes, it does seem biased, why? Because Nova HAVE NOT RELEASED any information other than rhetoric filled faxes with empty promises. Im sure as soon as Nova releases any kind of information, it will be up here just as quickly.

Yeah, man. It's like you're addicted to these articles because you can't stand them yet you can't stand not looking for the newest one either.

But what really annoyed me was that you said that "The government doesn't give two shits about it's foreign community". I mean, tell me...what should they do? Why are the Japanese staff (who haven't been paid in a month) in a better position than foreign teachers (besides the fact that many probably live with their parents)? I know that as a Westerner, we're taught from the cradle that every injustice we go through is a racial issue, but honestly, I don't really think it is. I don't think that the company and the government are saying, "Hey, let's add insult to injury with these foreigners! We hate them because we're racist Japanese." Actually, I and most of us are treated better by the Japanese than we ever were or are by our own people.

Well said!

Racism is alive and well in Japan my friend. If you haven't experienced it yet you are either lucky, naive, or blatantly ignorant. Japanese racism is done quietly...............for instance rejecting foreigners access to apartments........boosting rates when you do get a place.....not get a pay check(has happend to me twice here).....etc. They also like to starve us out............pardon the pun to those going hungry right now. It's quite easy for them to do all this because well............it's quite easy to deny and make up excuses for it as I'm sure you will do in your next post.

It was roughly 60 years ago that the Japanese tried to take over the world. A bit of racism is a huge improvement.

Look at the States. They (The Japanese) learn from them (Americans)!

Racism is very much alive in Japan...I have been here a couple of years...I dont work in the ESL field, but for a major western medical company. I get shxt all the time in Tokyo and Yokohama...usually from over 50 something people with a major attitude problem. I have been denied service, charged double fees, and hassled at hotels, taxis, restaurants, doctor's office, dental office....I stopped speaking Japanese about a year ago. Speaking english doesnt allow Japanese people the opportunity to attack me or give me problems.

I keep to myself and mind my own business, but amazingly these people just want to pick a fight with me. A few weeks ago, I was in the train to go home...I was talking to one of the female staff from my office on the train....then this old man in his 50's walks up to us and he points his finger in my face and says "Fxck You Foreigner!!".....most racism in Japan is subtle, but sometimes its right out in the open. As soon as people hear I can speak Japanese...I would get slammed with racist remarks and insults....right out of the blue....like " You should go home you white pork"...stuff like that. I was exetremely naive when I came to Japan...but after a few years here...I got hard. Its no wonder there is a high turnover rate for western staff at my company. They pay us 40% more than our home salaries and provide free furnished western style apartments for us, but thats not enough to offset the trouble and hassle we face everyday. Most western staff stay for less than one year and return home.

"Dr.Livingstone(d), I presume!" ... Or is it you? ANDERS?

What a load of bollocks! You sad people should return home to your racist-free societies.

I agree that the Japanese government is not acting in a racist manner, but I suspect that it is handling this situation the way it does many others: by hoping it will go away. The Japanese staff know that in the long run, they will be taken care of. For them, there is always that "long vacation" to look forward after they've finally walked away from this mess. For many of those thousands of foreigners out there, however, it is looking increasingly likely that they will simply have to leave the country without the hundreds of thousands of yen they are owed and desperately need to resettle in their home countries. That's very convenient for the government, but doesn't change the fact that these people were brought into this country to do a job that served hundreds of thousands of Japanese people and supported an industry that employed thousands of other Japanese people. This country does not owe foreigners a living, but neither can it treat them like disposable human beings. This ugly little episode is Japan's chance to show that it is responsive to the particular concerns of foreigners who contribute to this country's economy. As much as the Japanese government hates to admit it, this country needs foreigners, not just as language instructors, but in every field. Dropping the ball on this one is not just irresponsible; it is likely to create a lasting impression of Japan as a country that, when push comes to shove, simply doesn't give a damn about foreigners once it's finished using them.

http://en.wikipedia.org/wiki/Closed_Country_Edict_of_1635

You said an "old man in his 50's". I turned 54 last month and don't feel a day over 24..you age discriminating bastard.

BTW..tomorrow when you get up take a look in the mirror..put a finger towards the mirror and yell out "Gaijin da". Honestly get over yourself man.

..and just for the record I have been in this country on and off for over 23 years and never had a problem..except when I encounter dingbat gaijins like you...miserable bloody sod!

I call bullshit.

You would like it to be me wouldn't you?

Sorry my friend not this time.

Now let me get back to my Japan Times, bat milk, pipe and pink usagi slippers.

I am not a blogger and I have big day ahead of me tomorrow.

Anders Anonymous

Just curious as Exactly who is going to show up tomorrow.
AYE or NAY!,
they numbers should be amusing...

Yo Ho YO Ho a Pirates life fer ME!!!!!
NAY!!!!!

Yo Ho Yo Ho A Pirates Life Fer ME!!!!

NAY!!!!

I was only in Japan for a year and seven months.
I can't say I experienced alot of racism...at least not overtly anyway.
I kind of looked at the numbers. I can think of two maybe three people that I met that were racist towards me. Considering that I had a group of friends of over twenty or so Nihonjin and a heap of other aquaintences...and none of them ever gave me any kind of hassle. That's not a bad ratio.
I would hear through the grapevine that such and such Nihonjin didn't like gaijin...but you'd never know...unless you were Japanese I guess but then that's kind of a moot point.
Being in a small country town, I suppose I was enough of a curio that people didn't mind me being there that much.

May the fleas of five thousand recycled NOVA futons infest your underwear!

In the year 1640 in my local parish in England, 7 people were "hanged by the neck until dead" for clipping and coyning. 2 women drowned in the duck pond on trial of witchcraft and 3 people died by being frightened by fairies.
Get my drift?

GOING ONCE!....GOING TWICE!.............GONE!! BANG!!!

The very fact that you claim "Japanese people" are racist makes YOU the racist. To suggest that some members in the Japanese community have been racists towards you or foreigners in general is one thing. But, you said that, albeit implicitly, Japanese in general are racists. That sounds a bit like, "Foreigners are fat and loud"??? Sure, Japan has racism. But, show me a country, province/state, county, city, municipality, or neighborhood that doesnt. Its just a bit different when the shoe is on the other foot, huh? And, lets not forget that some of the racism experienced is a direct result of the behavior of some foreigners. Remember, the Japanese only know of foreign places and people, if they havent traveled, what is presented to them by foreigners. That does not excuse any racists behavior on their part, but bear it in mind.

I am not perfect when it comes to race relations myself, but lets just not be hippos about it. It doesnt do either side any good when you generalize about their generalizations. Thats the pot-smoker calling the crackhead a black. And, if you want to meet a really racist society, go to Korea! They are all racist bastards.

Who do you think they get their fangs into first, the kiddies, J staff, students or the instructors?

I wouldn't mind locking a half starved one in the Voice room on a busy Sunday afternoon.

Will I get detention if I don't?

I've been here for 30 years (not pissing for distance,54)and have seen very little racism. Although real-estate agents can be a bit rude at times.
When that little twat is in his fifties I'm sure he won't call himself "old"

HYENAS!?

Here's the naked truth, from someone here over 10 years. There is racism here, in the society. It is different from that in Western societies as it is based on our outsider status (gaijin, a pejorative, means outsider, though I admit it is generally used lightly). How many principals, MPs, doctors, etc, etc, do you see from foreign stock? They don't want to believe we can do skilled work or seem too smart and resent it when we do- as we are no longer in our 'gaijin place'.

It is seen as normal here to make it hard to get essential things like apartments, steady and secure jobs, sometimes even medical care for us. If you haven't been brushed with it, you are lucky and have also stuck to various ways of not annoying people, maybe relying on Japanese friends (I find that's safest). But the fact you haven't experienced something doesn't mean it isn't there.

I'm not saying all Japanese individuals are racists- far from it. But the society is, I think it may be related to Shinto beliefs of Japanese uniqueness. Usually it is harmless, curious 'racialism'- the strong belief that races are different. But if you seem too smart, if you want a better job, if you want a nicer apartment, be prepared for the possibility of 'racism'. Because as the society sees itself, you are not in your proper place.

How is this relevant here? Because it may well make it harder to get public sympathy and UI and easier for people to ignor you. It makes us vulnerable and dependant often on a 'guest' status. Put it this way- I wouldn't want to be poor and unemployed here and this is the fate that may befall some former Nova teachers. The 'kindness' of the Japanese may well fall away to reveal a nasty attitude that a lot of the guys here have towards foreigners, yet is often subtly or not so subtly hidden.

In my job, I'm seen as a guest, so treated well. But I can sometimes see the rage, envy, rejection, in some guys faces. Maybe they are jealous of my relative popularity with the females, maybe they are scared of the unknown- sometimes it is just my paranoia, no doubt- but it is definitely there.

I still love it in Japan- it's still a wonderful place- but this is one of the major problems here. And if they have an image for being racist- well, they've earned it, by refusing to face up to it (censored textbooks, etc.) Of course there is racism elsewhere- but it is a question of degrees, and I'd say here, under the surface, it is present to a very high degree- try any 'social climbing' if you stay longer and it will be there. Which isn't to say the racists will win- if Japan was as independent as they'd like to believe there wouldn't be any foreigners or foreign ideas here. Like it or not, they need us more than they think.

That was 1640, this is 2007. Get my drift?

Easy to be extreme. Running off into narrow lanes, dirt paths, dead ends; The highway's much wider. Why not be on the fast lane to success. Does it matter what/how other people think? Does it change anything? We must change first. Thank you all for making me realize this here tonight. (Maybe it's not only about racism, it's maybe how we choose to live.) Thanks a million!!!!!

Pretty much the same! Maybe we could change things by changing ourselves first.

I come from America, a very (subtlly and overtly) racist country, what`s new? People be racist, It`s shxtty. But I need a new job, for real. I can`t get one because we all lost our jobs at the same time. I can`t get UI because the rules are strict, not just strict for us. Have you heard law abiding foreigners talk about their experiences with American beurocracy? Living in a different country can be complicated, especially if you find yourself in the middle of a catastrophe like this. Who`s government does "give two shits about their foreign community" in the way you want Japan to right now?

Nova sucks the big one! I have been here three weeks and got shafted and the funny thing is the recruiters did not even tell me if Nova was having any problems. I guess the unemployment insurance is out of the question as I have only been here a short time. I have read that many of you Nova teachers want to go on strike next week, if you do, you won't get paid. I mean if the company files for bankruptsy and you're on stike you don't get paid for those days of but if you go to work you may be able to get the 80% government payout for those days you attend, just ring head office and tell them you are at work but it's closed.
Racism in Japan, of course it exists. You would have to be ignorant if you thought otherwise. Take a good look at your own country, racism exists there also. So get over it!

a crutch or a pogo stick, everything happens/happened for a reason, but the outcome changes, depending on how you perceive things. The Vantage point and perspective is yours. You choose a happier day for yourself and for me! I'm on your side, feel for you, I really do.

but don`t feel like you should go to work, the UI is no bed of roses I think. Has anyone recieved it yet? As a result of two late paydays, I mean. What`S the dilly with that? How was it? You`ve been here a short time but I bet we have a similar amount of money right now, which is all that matters. Hey, maybe we`ll all get paid tomorrow.
I promise I`ll go right back to work. Just pay my ass.
I was out with two students tonight who know the gravity of this issue with the co. One canceled his kids contract, but he is just a voicie so hes not in bad shape. They really felt bad for the position the staff is in; getting yelled at by angry customers yada yada. I agreed but pointed out that some teachers are actually starving at which point the subject was changed. Use up all your sick days at least, Don`t go in until we get our $.

I love Japan. I've always adoptedthe philosophy of "If you don't like it fuck off to were you came from". I too have been here for a few years and have also been th victim of racism. But there have been many instances where I have seen racism in our own countries; racism that is more common and more direct. To be honest, I am guilty of having the odd racial thought too.

However, my main concern in Japan is not that racism exists but that racist views of foreigners are propogated by both the central as well as Tokyo governments.

"I agreed but pointed out that some teachers are actually starving at which point the subject was changed."

This is worth repeating. I know this is but one person's experience, but I'd imagine the rest of the Japanese society would act in the same fashion if under the same conditions. Society, doesn't want to hear what's going on--not that they have to nor do they need to do anything, but a little sympathy/outcry on their part COULD help those f'ed over by NOVA!

How many here have contacted their media outlets in your own home countries? If you haven't you should! It seems as though the Australian Government is the only one actually making any noise in all this, where are the other countries? Have they all turned a blind out on this crisis? American's really need to get some kind of news coverage on this, as it seems their government is doing the least to help them. Scream, damn it! SCREAM!

Hope the changes at NOVA helps you in someway in the end, but more than anything, I hope you get your lost wages. Getting a fraction, and a small one at that, of what you are owed is still very, very, wrong.

Good luck

In Japan the media perpetuates images of the 'dumb, dangerous' foreigner, the governments treats crime as a foreign problem (maybe it mostly is, but this conveniently ignores the yakusa) and there is an underlying sense of seperation between the Japanese and everyone else. This has caused me problems with racism- many places wouldn't rent me an apartment, or only showed me bad ones. The government here discretely aids and abets these attitudes by making it hard to become Japanese or a permanent resident.

But that doesn't stop it from being a great place, with lots of possibilities- I did get a good apartment, I hopefully have a more secure job. We just have a massive disadvantage with these things, not to say other people in our own countries don't too. Japanese people need to learn that they can be more loyal to their country and people by not being racist. In the meantime stick with the helpful people who are glad we are here, avoid the black hole of thinking it's all bad. Positive thinking can overcome all kinds of difficulties- look at Ghandi or Martin Luther king. Let's make sure the racists are the ones who lose.

My advice- seem a bit feminine, so you're less threatening and be a good guest by following the courtesies and showing some respect for the local customs. They are also afraid of racism and think Westerners look down on them, as having an intention to be colonial, etc (the main reason why it's so rare for foreigners to get important jobs, I believe). If you show appreciation, etc, doors can open.

Well put! New opportunities are opening up, choose the positive. You have my support, too- all things happen for a reason, every change brings the chance of a brighter life.

Who is dressing like the bunny for haloween? I bet you get some laughs on the Osaka Loop Line!!

Be positive..."!"

Americans are racist and I hate Americans.

Sat, 04/26/2008 - 02:35 — teren sediu (not verified)

Japan is a homogenous country and they have very specific customs and rules of behavior that most foreigners cannot understand.

geee teren, posting such a profound comment! and only 6 months after the last thread! boy you are fucking insightful! can you be my guru?
dipshit!

I live in Japanese public housing, date Japanese girls, have been invited into Japanese bordellos, been to Japanese people's houses, for dinner, have been taken to hostess bars, gratis, by salaried Japanese friends, have been offered work, outside the field of "please teach me English"...etc

I don't think it's pure racism. I think race is used when people decide they don't like you, and don't want to deal with you. I'm lucky, as, in addition to being incredibly charismatic and handsome, the occasional difficulties the locals throw at me are water off a duck's back, and I dwell on the mainly good stuff.

Oh, and by the way, not just losers date Jgirls. I've dated Aussie, Kiwi, American, Belgian, German, Thai, Turkish, British and Swiis girls among others, and rate most of them very highly, but to me, Jgirls are in a league of their own. You don't have to agree/disagree, because we all have our tastes - mine are very much Japanese, and that's the main reason I live here.

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