Japan Post, Orix agree to cancel 'Kampo-no-yado' inn network sale+

TOKYO, Feb. 13 Kyodo -
Communications minister Kunio Hatoyama said Friday that Japan Post Holdings Co.
and leasing firm Orix Corp. have agreed to cancel a controversial 10.9 billion
yen contract for Japan Post's sale of 70 ''Kampo-no-yado'' inns and nine
housing facilities to Orix.

Japan Post President Yoshifumi Nishikawa made the request on Monday during a
meeting with Orix Chairman Yoshihiko Miyauchi, and Miyauchi accepted, saying
''There is no choice,'' Hatoyama told reporters after talks with Nishikawa.
Japan Post and Orix are expected to formally announce the cancellation next
Monday.
In the meeting with Nishikawa, Hatoyama hailed Miyauchi's decision to accept
the cancellation as ''gracious'' while indicating that he will continue to seek
a probe into the details of the bidding process.
''President Nishikawa has a responsibility to clarify (the misgivings) and I
hope he will play a certain role'' until the whole picture becomes clear, the
minister said.
Orix won the contract for lump-sum purchase of the nationwide Kampo-no-yado inn
network and the housing facilities in Tokyo through competitive bidding, but
Hatoyama has cast doubt over the fairness of the bidding process and the price.
Hatoyama said he and Nishikawa, former president of Sumitomo Mitsui Financial
Group Inc., did not discuss whether Nishikawa would resign as Japan Post
president over the Kampo-no-yado sale controversy.
The Kampo-no-yado inn network, developed for Kampo postal life insurance
policyholders before the October 2007 privatization of the postal system, has
been losing some 4 billion yen annually.
Japan Post is expected to consider other options including selling the inns
individually.
==Kyodo