The Japanese company, Unitika, which was a leader in developing the nation's textile industry, is now withdrawing from the business altogether.

The firm's textile segment, mainly for clothing, has been losing money in recent years in the face of fierce competition from China and other overseas rivals.

Unitika President and CEO Ueno Shuji said: "We were unable to carry out drastic business reforms given the potential challenges, such as declining profitability and a rigid cost structure. As a result, loss-making operations continued."

Unitika expects a net loss of around 10 billion yen, or 68 million dollars, in the current fiscal year through March.
It says it plans to receive capital support from a public-private investment fund. The fund will become Unitika's largest shareholder, and all current executives will step down, in principle.

Unitika will now focus on its growing polymer business, which produces films for food packaging and semiconductor-related materials.

The Osaka-based company was founded in 1889 as Amagasaki Spinners. It contributed to the industry's modernization and the country's post-war economic boom through exports of chemical fiber.