** This magazine has reported on the strange M&A surrounding the long-established wedding venue 'Kashima Garden Villa' in Shirakawa City. After the management changed from the local notable Wachi family to a group residing outside the prefecture, the venue ceased operations, and the real estate that was used as collateral was put up for auction by financial institutions. The current president of the venue stated in an interview with this magazine, 'The purpose of the M&A was not company revitalization,' and 'I was deceived as well.' According to the current president, more than 30 companies nationwide have suffered the same fate as this venue, and a dozen of them have formed a 'victims' association' and are seeking an investigation from the police, which is surprising. **
The hired president exposes the inside story
The Silent Kashima Garden Villa
"I was seriously thinking about rebuilding the company, but those guys were different. They just deceived me, took my money, and ran away. When I see their faces, I don't know what I might do. I'm that angry."
Fukuchi Kazunobu (30) speaks in a stern tone. His title is the President and CEO of P&K Company, the operating company of Kashima Garden Villa (hereinafter referred to as Kashima Garden), but according to Fukuchi, "I was not allowed to touch any part related to money at all." The place where the author met Fukuchi during this interview was not in Shirakawa City, where the venue is located, but in a room in a building in Tsuchiura City, Ibaraki Prefecture, 120 km away in a straight line (the reason will be explained later).
The strange M&A surrounding Kashima Garden reported in the May 2022 issue and the March issue of this magazine. For details, please refer to both articles, but our magazine learned that something unusual happened at P&K around March 2022.
Upon investigating the registration certificate of P&K Corporation, it was found that the representative directors Hiroyuki Wachi, Shigezo Wachi, directors Tohru Wachi, Nobuko Wachi, Koichi Shudo, Hirofumi Narita, and auditor Yukie Ishizaka all resigned simultaneously on October 28, 2021, and that the new representative director Kazunobu Fukuchi, directors Tatsunao Sasaki and Akihito Hirota, along with the accounting advisor Meisei Tax Accountant Corporation, were appointed on the same date.
Former representative director Shigezo Wachi has long reigned as a local dignitary, having served as the president of the Shirakawa Chamber of Commerce and the chairman of the Shirakawa Tourism and Products Association. Similarly, former representative director Hiroyuki Wachi, the eldest son of Shigezo, took over the company from his father in 2005.
The Wachi family, who suddenly withdrew from P and K without any contact with the local business community, and the likes of Mr. Fukuchi, who has an address outside the prefecture, and Mr. Akikiyo = Mito City, Ibaraki Prefecture =, and Mr. Hirota = Yokohama City, Kanagawa Prefecture =, took office as executives, which raised the question among business people, "What on earth happened?"
We have in our possession the stock transfer agreement of P&K Corporation (dated October 28, 2021). The seller's column lists "Hiroyuki Wachi," and the buyer's column lists "BB Build Co., Ltd. (Yokohama City) Representative Director Akihito Hirota."
The main contract details are as follows.
On the stock transfer date of October 28, 2021, all 8,000 shares of P&K Corporation's issued shares will be sold by the seller to the buyer.
② The stock transfer price shall be 100 yen per share, totaling 800,000 yen.
③ The seller shall deliver to the buyer, in exchange for the full payment of the transfer price, all of the following: ▽ the official seal of P&K Corporation (with a seal registration certificate issued within one month from the date of issuance), the seal card, and all transaction seals of financial institutions, ▽ the deposit passbook of P&K Corporation, the checkbook, ▽ the accounting documents of P&K Corporation and other documents necessary for conducting business.
④ The buyer shall not request changes to employment conditions due to the transfer of shares and shall maintain the employment conditions as of the date of the share transfer for at least one year. However, this shall not apply in the event of a resignation or request for changes in employment conditions from the employee, changes in laws and regulations, or significant fluctuations in economic conditions.
⑤ The buyer guarantees that if the seller has contracts for joint guarantees or collateral provision for P&K's borrowings, purchases, leases, or other debts, or if the seller has incurred debts on behalf of P&K, they will promptly take procedures for cancellation, repayment, and changes to joint guarantors, and ensure that the seller is released from the above debts.
During the period from the execution of the stock transfer until the procedures for cancellation, repayment, and modification described in the previous section are carried out, if any claims regarding the guarantee liability, etc. described in the previous section are made against the seller and the seller's relatives, all such claims shall be handled at the burden and responsibility of the buyer and the target company.
At that time, due to the COVID-19 pandemic, wedding venues were facing tough management challenges. P&K Corporation had also been in the red since the fiscal period ending in August 2017, as far as I know.
Selling the shares of P and K, which had sales of 550 million yen in the same period of 2021, for 800,000 yen feels too low, but considering the debts and future prospects, Mr. Wachi may have wanted to part with the company as soon as possible. Above all, the contract terms that would remove him from being a guarantor and discharge the debts must have been the greatest attraction for Mr. Wachi.
From here, we will listen to the story of Mr. Fukuchi mentioned earlier. Mr. Fukuchi became the president of P and K Co., Ltd. after being invited by the tax accountant Takushi Kanda of Meisei.
Fukuchi, who had met Kanda Tax Accountant through tax consultations in his previous job, was invited, "There are two people who are working on company revitalization. Would you like to try it together?" and was introduced to Hirota and Katayama in June 2021.
"I first met Hirota at a coffee shop in Tsuchiura City, and he explained, 'We are creating a company called Lucian Holdings to carry out corporate revitalization nationwide.' At that time, I remember there was 'Fukushima Prefecture Wedding Hall' on the list shown to me by Mr. Hirota" (Hereafter, unless otherwise noted, comments are by Mr. Fukuchi)
Lucian Holdings Co., Ltd. (Chiyoda, Tokyo) was established in 2021. The executives are Representative Director Akihito Hirota, Kazunobu Fukuchi, Directors Tatsuhiro Sasaki, Goro Yamauchi, Masaki Araki, and Naoshi Katayama, with the accounting advisor being the tax accountant corporation Meisei.
"Just focus on store operations"
The company's corporate registry lists a total of 35 business purposes, including real estate. During recent interviews, the reporter called the company several times and only connected with a female clerk once, who said, "I will have Fukuchi call you back," but ultimately there was no contact. The email address is unknown, and there was no response even after sending a questionnaire by fax.
"It is the Tokyo headquarters, but it's just a rental office. You can use the service that connects you when a call comes in. I was told to do it that way by Hirota, so I was set up like that."
After that, Mr. Fukuchi met several times with Mr. Hirota, Mr. Katayama, and Mr. Kanda and was given the condition that "the compensation is 1 million yen per month. However, I would like you to take over the joint guarantor from the previous management for a period of 3 to 4 months after assuming the position of president."
"Anyway, I was told that Hirota is also in the process of acquiring another company and cannot be a guarantor, so I would like you to act as a substitute for a while, and I will switch the guarantor as soon as the time comes."
However, when asked which company they would acquire, Mr. Hirota and others only replied, "We will let you know once it is decided."
Although there were unclear parts, Mr. Fukuchi, who felt attracted to the work of corporate revitalization, decided to take it on after much deliberation. Then, in October 2021, he was suddenly informed by Mr. Hirota, "The company to be revitalized has been decided. We will enter the acquisition immediately."
I was told to come to Shirakawa on October 28 of the same year, and it was there that I first learned that the company being acquired was P and K. However, at that point, I still did not know who the original shareholders were, and as soon as I arrived in Shirakawa, the signing ceremony for the stock transfer agreement was held.
At the signing ceremony, there were also representatives from the intermediary consulting company that connected Mr. Hiroyuki Wachi and Mr. Hirota.
Originally, before the stock transfer agreement, there should be due diligence (detailed investigation of the target company for M&A), top interviews, and a basic agreement, but Mr. Fukuchi was called directly to the contract meeting without being involved in any of those.
"Before I knew it, the signing ceremony was over, and a conversation took place between Hirota and Mr. Wachi Yuki about whether cash or a bank transfer would be better. When Mr. Wachi expressed his preference for cash, Hirota handed him 800,000 yen on the spot."
It was the moment when P and K Co. was sold to Mr. Hirota and others from the Wachi family for 800,000 yen.
Mr. Hirota's handling from there was speedy, and immediately after the signing ceremony, he promptly brought the pre-prepared registration application documents to the Legal Affairs Bureau, completing the officer change registration on the same day.
Thus, what Mr. Fukuchi, who suddenly became the president of P&K, was told by Mr. Hirota was, "Kadayama and Kanda will handle all the money matters. You just need to manage the store operations."
In fact, Mr. Fukuchi had never seen the financial statements of P&K Corporation, and after being taken around three wedding venues in Tochigi Prefecture managed by P&K Corporation and greeting the employees as the new president, he focused solely on the operations of the stores.
"The problem was that, after the change of the representative director, I tried to change the name on the bankbook, but the financial institution did not respond."
The main bank of P and K Co., Ltd. is Shirakawa Shinkin Bank, and the next highest deposit balance was Ashikaga Bank. In addition, there were transactions with Toho Bank, Fukushima Bank, and Joyo Bank, but "Shirakawa, Toho, and Fukushima did not agree to the name change."
Financial institutions are on high alert
Akihito Hirota
Shang Clan of Jiadushan
"It seems that before requesting a change of name, there was information shared among financial institutions that 'the Wachi family seems to have withdrawn from the board of P&K' and 'the financial capabilities of the newly appointed members are completely unknown.' I have heard that from the perspective of the financial institutions, there was a sense of distrust, asking 'Mr. Wachi, did you proceed with the M&A without consulting us at all?' In particular, I think the local Shirakawa Shinkin Bank had also extended credit to the Wachi family. At that time, the debts of P&K exceeded 700 million yen in total for both short-term and long-term, so it is only natural that the financial institutions would be cautious and refuse to agree to the name change if the board members were changed in an opaque manner."
Thanks to this, Mr. Fukuchi had to go to the financial institution to write the necessary documents and stamp them with his registered seal and bank seal for each transaction, such as salary and payments to business partners.
"Joyo Bank has an office of Meisei Tax Accountant Corporation in Mito City, and since there was a transaction, they agreed to the name change. Ashikaga Bank also agreed. A new account in the name of P and K was also opened at JA Suigo Tsukuba (Tsuchiura City)."
From now on, the inflow and outflow of money related to P and K Corporation will mainly use the account of JA Suigo Tsukuba.
The bank meeting held immediately after taking office as president was also a dismal affair.
"I had my own reconstruction plan and had thought about possible questions, but when I showed it to Hirota, Katayama, and Kanda, they said, 'You don't have to answer anything.' "
Mr. Hiroyuki Wachi also participated in the bank meeting, sitting at the edge, while Mr. Fukuchi listened to the interactions with the financial institution representatives next to Mr. Hirota and others. What Mr. Hirota and others proposed was to "add a shared office function to the Kashima Garden, separate from the wedding venue."
"However, there seems to be no indication that any research has been conducted on the demand for shared offices in Shirakawa, or whether profits can be expected. It was also not clearly demonstrated what kind of synergy exists with wedding venues."
With this, it is unlikely that the financial institutions would be convinced, and the bank meeting ended in about 30 minutes.
Immediately after that, Mr. Fukuchi was shown several documents by Mr. Katayama and was urged, "Sign and stamp 'Fukuchi Kazunobu' here, here, and here."
"When I looked, it was a life insurance document that the corporation could receive in case something happened to the executives, and the beneficiary was P and K Company. They are asking me to cancel it, so they want the signature and seal of 'Representative Director Kazunobu Fukuchi.'"
There was no explanation from the Katayama family about what to do with the money received from the cancellation, but in the month following the stock transfer, 15 million yen and 30 million yen were deposited into the JA Suigo Tsukuba account, and in January 2022, I later learned that nearly 100 million yen was present in the account, including the money that came in from the cancellation of the life insurance.
"In the end, that money was divided into three parts: 30 million yen to Hirota's private company, 30 million yen to Katayama's office, and 30 million yen to Meisei."
It seems that Mr. Hirota and others aimed to convert everything of value into money from the very beginning.
After that, Mr. Fukuchi tried various attempts to rebuild the Kashima Garden, but was repeatedly dismissed by Mr. Hirota and Mr. Katayama with "It's pointless to do such things." On the other hand, Mr. Fukuchi, who did not have the authority regarding money, constantly asked both gentlemen to prepare the necessary funds as the payment date approached, but he was usually met with a sullen response. Mr. Fukuchi would persuade them by saying, "If that happens, the company will not be able to function," and finally, the situation where money was prepared was repeated every month.
Eventually, Mr. Fukuchi was also appointed as the president of a wedding hall in Yamagata Prefecture and a construction company in Tochigi Prefecture, but he was still not allowed to touch any financial matters related to Mr. Hirota, Mr. Katayama, and Mr. Kanda, while being burdened with all the practical work.
"It was later revealed that Hirota and Katayama had been renting various properties in my name without my knowledge. They were also extravagantly dining and drinking using the company's credit card."
This was something I found out later, but the guarantor of P&K Corporation had not been replaced by Mr. Hirota and others even after the stock transfer, and it was still Mr. Wachi Hiroyuki, the former president, not President Fukuchi. They searched for companies in financial difficulty to buy them cheaply, converted all valuable assets into cash, but did not take on the debts, instead pushing them onto the former management—this was the method of "corporate takeover" used by Mr. Hirota and others.
After finishing the extraction of money, payments gradually began to be delayed. Mr. Fukuchi started receiving calls saying, "We will be in trouble if we don't get paid." However, when he sought a response from Mr. Hirota and Mr. Katayama, they showed no signs of responding properly, and eventually stopped answering the phone. Kashima Garden was closed around last autumn, less than two years after the transfer of shares and changes in executives.
Mr. Fukuchi, who was made a "human pillar"
A plate with 13 company names written on it in a room of a building in Tsuchiura City
There are a large number of cardboard boxes in the room.
Several mails and documents were placed in a disorderly manner.
The author met with Mr. Fukuchi in a room of a building in Tsuchiura City during this interview, but it was a location where multiple companies had been taken over by Mr. Hirota and others. The plate posted at the entrance of the room had the names of 13 companies written on it, and upon entering the room, there were a large number of cardboard boxes neatly arranged on shelves. There were also cardboard boxes scattered on the floor, some of which contained financial statements and documents related to the management of the taken-over companies. A cardboard box labeled "Kashima Garden" was also confirmed.
I think that Hirota and the others were repeatedly engaging in a cycle of taking over the company to siphon off money, diverting it to overdue payments, and then taking over again to generate money when another payment was overdue.
When I was shown to a separate room, there were desks, chairs, and a computer, and a large number of documents were scattered around. Countless envelopes addressed to Mr. Fukuchi were piled up unopened.
"Notices of unpaid taxes and reminders from the government office, notifications from the court, and registered mail, come in every day from various places, so I can't make sense of it."
Mr. Tatsuhiro Sasaki, who serves as a director at P&K Corporation and Lucian Holdings, is a person whom Mr. Fukuchi became acquainted with during his previous job and who took on the role of a consultant.
Mr. Sasaki spoke with anger seeping through.
"Mr. Fukuchi was made a 'human pillar' by Hirota, Katayama, and Kanda. Some may say that those who fell for a good story are to blame, but Mr. Fukuchi did not receive any benefits from P and K Co., and was only burdened with troublesome work from Hirota. His monthly salary was 1 million yen, but after withholding tax, it was left at over 600,000 yen, and he had not paid income tax. Moreover, he was also made to bear the costs of the company's advance payments and the rent for real estate that Hirota and others borrowed without permission, so it is questionable whether he had a take-home pay greater than that of an ordinary salaryman."
According to Mr. Sasaki, Mr. Fukuchi was under strict surveillance by Mr. Hirota and others.
"Fukuchi was doing his best to rebuild the company in his own way. But he was overwhelmed by the constant influx of mail and documents, leaving him no time to return home. Every day was like working while taking naps on a sleeping bag laid between shelves filled with cardboard boxes and next to his computer. Hirota and others were monitoring Fukuchi every day with a large number of cameras set up indoors. I think they were watching his every move to ensure he didn't do anything unnecessary that would affect their plan (company takeover). In fact, Hirota and Katayama were unilaterally giving instructions to Fukuchi, and when things didn't go as they wanted, they threatened him by saying, 'I'll corner you until you die.'" (same)
The situation that Mr. Fukuchi was in seems, upon calm reflection, to have been one that he could have escaped from early on, but Mr. Sasaki defended Mr. Fukuchi by saying, "At that time, I was in such an unusual environment that I couldn't make a proper judgment."
The damage involves more than 30 companies nationwide
List of companies taken over by Mr. Hirota and others
In fact, there are more than 30 companies across the country that have been taken over by Mr. Hirota and others. According to the president of a company in Toyama Prefecture who responded to the author's interview, a dozen or so of these companies have formed a "victims' association" to put pressure on Mr. Hirota, Mr. Katayama, and Mr. Kanda, while also requesting investigations from the police in various regions. Mr. Fukuchi also stated, "I went to the XX police station and conveyed the details of their methods. I don't want them to ever walk in a place exposed to the sun again."
What kind of people are Hirota and Katayama? "Hirota is what you call a 'troublemaker' and serves as the president of various companies. I heard that Katayama's brothers are university professors and lawyers, but I don't know much about his background. They are both 65 years old" (Fukuchi). Currently, they are said to be missing and out of contact.
On the other hand, what about Mr. Kanda, the tax accountant? When I requested an interview with Akikiyo mentioned earlier, a female staff member said, "Kanda is on a business trip and will not return. I don't know, so I will contact him and have him call you back," but there was no contact at all.
According to the president of a company in Toyama Prefecture, in mid-April, a questionnaire was sent to Mr. Kanda as the "Victims' Association" asking about the reasons for involving Mr. Fukuchi in the acquisition of P&K Corporation, but as of April 22, there has been no response.
Some readers may think, "There are no such good stories in the world," or "Mr. Fukuchi brought this upon himself." However, it goes without saying that the one who deceives is absolutely worse than the one who is deceived. To prevent further victims, the police should take the investigation seriously.