Selling the company off in pieces: cosmetics to Kao, and dissolution (2004–07)

Realising value as assets rather than preserving the corporate body

The core of this decision lies in handling the aftermath of the fraud not by rebuilding the enterprise itself but by carving it into assets. The Industrial Revitalization Corporation chose, over keeping alive a corporate person that had lasted 120 years, to find a buyer for each business, realise its value, and maximise repayment to creditors. That in the event buyers were found for almost all of the more than twenty businesses, and that mass dismissal through liquidation was avoided, can be taken as showing a certain rationality in the method as a technique of corporate revival.

What was left behind, however, were the nearly 100,000 individual shareholders who remained attached to Kanebo as a legal entity. That litigation over the tender-offer price continued long after the dissolution suggests that the rules had not kept pace with the question of who divides the value of a business, and how. And the path by which the brand that passed to Kao was only gradually integrated across research, production and sales — after the vitiligo problem — hints that preserving a company and preserving the technology and brand lodged inside it do not necessarily follow the same road.