Japan’s first strike in decades: Tokyo department store workers hit the picket lines
A strike action in front of the flagship Seibu Ikebukuro department store in Tokyo on Thursday.

TOKYO—Japanese retailer Seven & i Holdings Co. is selling department store chain Sogo & Seibu Co. to a U.S. investment fund, even as the union representing the company’s retail workers went on strike ahead of the announcement Thursday. It’s the first major walkout the country has seen in decades.

Some 900 striking workers marched and handed out leaflets on the streets near the flagship Seibu department store in Tokyo, where the shutters were closed. On a typical day, the store sees 100,000 customers walk through its doors.

There is widespread speculation that Fortress Investment Group may have snapped up the department store at a cheap price in hopes of profiting off the valuable land on which its outlets sit; the U.S. private equity fund is rumored to have little interest in running retail locations—thus putting all the workers’ jobs in jeopardy.

Strikes and protests are rare in Japan, where the government has long sided with industry and big business over workers and their unions. The last time workers walked out on a major department store was 61 years ago, and for less than a day, according to Japan’s biggest industrial union, UA Zensen.

Labor markets are currently tight in Japan, where workers at major companies won the biggest wage increases in 30 years at labor negotiations earlier this year. Those wage gains have been trimmed by inflation, however, and in real terms, pay has continued to fall.

Sogo & Seibu’s workers had the support of labor groups from rival department stores including Takashimaya and Isetan Mitsukoshi.

Building solidarity with the public, strikers apologized on camera in Japanese TV news reports for any inconvenience they may be causing the public but said the selling of their employer to a U.S. hedge fund endangered jobs and left them no choice.

“Until the moment seals are put on the share transfer contract, we will convey our thoughts in a single loud voice without quitting,” Yasuhiro Teraoka, chairman of the union, told the media.

Members of the public came out in support. “I think the strike is groundbreaking,” 68-year-old retiree Susumu Aso told reporters, as he stood in front of the black shutters that covered the normally bustling building’s windows. “I’m so interested so I took a two-hour train ride to see it. I think it will have a great impact nationally.”

The Seibu deal was postponed since it was first announced in November because of widespread opposition. The transfer to Fortress Investment Group will be completed Friday, according to Seven & i Holdings. The decision came at a board of directors meeting. The proposed sale price is 220 billion yen ($1.5 billion) but won’t be final until the transfer’s completion set for Friday.

The Seibu & Sogo retailers total 10 outlets nationwide. Although the demise of department stores has hit Japan far later than in some other nations, like the U.S., their clout has been waning with the advent of online shopping. Seven & i Holdings also has under its wing the 7-11 convenience store chain, as well as Ito-Yokado, a grocery chain that remains relatively popular, and Loft, which sells stationery and home knickknacks.

The company said it will leverage its strength in convenience stores as well as food stores to reshape its business.

New York-based Fortress Investment Group LLC was founded in 1998 and manages about $44.7 billion of assets.

This article features reporting by AP correspondent Yuri Kageyama. It has been supplemented with further material and quotes.

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