April 27, 2018 / 5:30 AM / a year ago

Kobe Steel to sell 75 percent stake in real estate unit for $678 million

FILE PHOTO: The Kobe Steel (Kobelco) headquarters building is seen in Kobe, western Japan October 24, 2017. REUTERS/Thomas White/File Photo

TOKYO (Reuters) - Japan’s Kobe Steel Ltd (5406.T) said on Friday it will sell 75 percent of its stake in its real estate unit to two Japanese real estate firms for 74 billion yen ($678 million).

The sale is aimed at raising the value of its wholly-owned unit, Shinko Real Estate Co Ltd, and not to raise cash after its widespread data tampering scandal, a Kobe Steel spokesman said.

Under the agreement, Kobe Steel will sell its 70 percent stake in Shinko Real Estate to Tokyo Century Corp and 5 percent to Nippon Tochi-Tatemono Co Ltd. The deal is subject to approvals from local authorities and is aimed to be completed on July 1, it said.

Kobe Steel plans to book a special profit of 30 billion yen from the sale in its April to September earnings on a consolidated basis.

Kobe Steel, which supplies steel and aluminum parts to manufacturers of cars, planes and trains around the world, has admitted to supplying products with falsified specifications to more than 600 customers and that the data fraud has been going on for nearly five decades.

($1 = 109.1800 yen)

Reporting by Yuka Obayashi; Editing by Christian Schmollinger

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