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Japanese construction firms targeted in fresh raids

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Tokyo prosecutors raided the headquarters of Japanese construction firms Taisei Corp and Obayashi Corp on Tuesday over alleged antitrust violations linked to $80 billion worth of magnetic levitation (maglev) train projects.

[TOKYO] Tokyo prosecutors raided the headquarters of Japanese construction firms Taisei Corp and Obayashi Corp on Tuesday over alleged antitrust violations linked to $80 billion worth of magnetic levitation (maglev) train projects.

Shares in Taisei fell 5.3 per cent to a more than 3-month low, while Obayashi shed over 3 per cent before paring losses.

The benchmark Nikkei average was flat.

Taisei, one of the so-called "big four" of Japan's construction firms, is fully cooperating with the investigation, company spokesman Takayuki Renbutsu said.

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Separately, prosecutors raided Obayashi's offices over suspected antitrust breaches, a company spokeswoman said. The firm is already under investigation for suspected bid-rigging over maglev-related contracts.

The Tokyo prosecutor's office said it could not comment on individual cases.

The raids come after prosectors launched investigations into Shimizu Corp and Kajima Corp, also on alleged antitrust breaches related to the maglev project. The train line will link Tokyo, Nagoya and Osaka.

Shimizu shares fell as much as 3.2 per cent, while Kajima slumped as much as 5.6 per cent, both extending losses from Monday.

Japan's large and politically influential construction industry has been a frequent source of scandals such as bid-rigging.

REUTERS