Impending Doom of NOVA -- How long?

[Bueller_007]

http://www.letsjapan.org/?q=the-middle- ... -nova.html
http://tmp6.2ch.net/test/read.cgi/company/1183943877/
http://academy6.2ch.net/test/read.cgi/e ... 11370/l50x
http://school7.2ch.net/test/read.cgi/jo ... 76/301-400
http://www.gaijinpot.com/bb/showthread. ... light=nova
http://groups.yahoo.com/group/novateachersunited/


Facts:

*NOVA is hemorrhaging funds (-57 billion yen "revenue" and -2.5 billion yen "net income" in 2007)

*Stock prices are down to ¥76, about half what they were at the beginning of the year, and a tenth of their 5-year high.

*Students are quitting in droves and getting refunds.

*NOVA can't sign students to anything longer than a one-year contract. And NOVA's been taking a major bashing in the press, so no students are really even interested anymore.

*Teachers were 12 hours late getting paid this month.

*Japanese staff were supposed to get paid on the 27th, then NOVA bumped that to the 30th because of a "system error". It's now past midnight on Aug. 1 and staff still haven't been paid.

*Staff bonuses (which they rely on because their pay is otherwise pretty miserable) have been put off "until October".

*NOVA is bleeding staff and teachers left and right, including a number of higher ups (AAMs and RAAMs) as well.


Rumours:

*All advertising in Tokyo has been pulled. (With rumours of them pulling the majority of it nationwide also coming in.)

*NOVA has started selling off real estate.

*NOVA has been unable to pay the July rent on a number of the schools.


As one NOVA staff/2ch-poster so eloquently puts it:
くそ本部長！！！！！
事情説明しろや！！！！
お前ほんま殺されるぞ！！！

So, how long until NOVA bites the big one? Or will the government bail them out?

[JonB]

why would the government bail them?

[Bueller_007]

why would the government bail them?

Well, the whole reason behind punishing NOVA was that they screwed their customers on their refunds. If they go bankrupt, then the customers will get screwed even worse on their refunds, because NOVA hasn't paid them off yet (there's a 4-month waiting list). That means that, if anybody, the government would be stuck with the bill. From my POV, if the government believes that it's possible for NOVA to survive, it makes more sense for them to *loan* NOVA the money and ease their restrictions until the debt can be paid off. At least that way, the government doesn't have to foot the refund bill permanently. (And they don't have 8000 foreigners and however many Japanese staff out of work, looking to collect unemployment checks, which they're eligible to collect immediately in the case of a corporate bankruptcy).

I guess refunds could come out of NOVA's assets, which would be liquidated if they went belly up, but, really, what assets do NOVA have? They've already sold off a lot of their real estate. Other than the chairs, desks and decade-old computer equipment in the schools, they don't really have a lot to sell off.

[JonB]

bail out every firm that goes into liquidation? Also can't see them worrying about the 8000 foreigners jobs that will be lost - but perhaps I am just being cynical...

But looks like they might survive a bit longer - BNP seems to have bought up a lot of their shares and is now the largest shareholder. Not sure that would be something to brag about

[Bueller_007]

bail out every firm that goes into liquidation? Also can't see them worrying about the 8000 foreigners jobs that will be lost - but perhaps I am just being cynical...

Well, the whole point is that the only reason that they are screwed is because of a government ruling. (One of the harshest punishments that has every been handed out by the Japanese government.)

It doesn't make a lot of sense for the government to say "you didn't pay back your customers, so we're going to punish you so severely that you'll go bankrupt and will never be able to pay back your customers."

But looks like they might survive a bit longer - BNP seems to have bought up a lot of their shares and is now the largest shareholder. Not sure that would be something to brag about

They bought 11.65% of the company. President Sahashi (猿橋) (usually called Monkeybridge by English staff and just "monkey" (猿, "saru") by Japanese staff) is still the largest stockholder. He still has controlling interest in the company (which in Japan means more than 2/3 of all shares.)