Major Japanese contractor Obayashi Corp. said Tuesday its president, Toru Shiraishi, will resign in March, in a move seen as taking the blame for alleged bid-rigging over a Tokyo-Osaka maglev train line that also involves three other firms.
Obayashi, which has been investigated by prosecutors and a monopoly watchdog for alleged collusion, has admitted to an antitrust violation over bidding for work linked to the maglev train project, according to sources close to the matter.
The 70-year-old president, who has led the contractor since 2007, will be replaced by Senior Managing Executive Officer Kenji Hasuwa, 64, as of March 1. Shiraishi will also step down as a board director at a shareholders' meeting in late June and will become senior adviser, Obayashi said.
Vice President Kozaburo Tsuchiya, 66, in charge of the maglev train construction project, resigned Tuesday as well, as he had offered to quit, according to the company.
"While authorities have yet to make a decision (on the case), we have decided that it is necessary to seek the truth and build a compliance structure as well as launch a new management at an early date," Obayashi said in a statement released Tuesday.
Shiraishi is set to hold a press conference later in the day.
Investigators have been looking into how Japan's four biggest contractors have won 15 of the 24 maglev train-related construction tenders since 2015. By 2037, the envisioned line is expected to connect the two major cities, 500 kilometers apart from each other, in about an hour.
Seeking exemption from punishment under leniency rules, Obayashi has already told the Japan Fair Trade Commission that it engaged in bid rigging with Kajima Corp., Taisei Corp. and Shimizu Corp., according to the sources.
In December, the Tokyo District Public Prosecutors Office's special investigation squad raided Obayashi's head office, suspecting it engaged in fraudulent obstruction of business in a tender to build an emergency exit in Nagoya for the maglev train line.
The prosecutors and the FTC also searched the headquarters of the three other contractors in Tokyo on suspicion of conspiring to determine which company will win orders ahead of the bidding.
Hasuwa joined Obayashi in 1977 after graduating from Osaka University. He has been leading a department that deals with new businesses including renewable energy since 2014.
He was appointed senior managing executive officer in April 2016 after assuming a director post the previous year.
Land, Infrastructure, Transport and Tourism Minister Keiichi Ishii on Tuesday declined to comment as it was a personnel change at a private company.
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