Kyo-ya owns the Sheraton-Waikiki, Royal Hawaiian Hotel, Sheraton Moana Surfrider, Sheraton Princess Kaiulani and Sheraton Maui.

A spokeswoman for Kyo-ya in Hawai'i said the company is unaware of any potential effect on Hawai'i operations from the ownership change.

Starwood Hotels & Resorts manages the five hotels. Keith Vieira, Starwood senior vice president, said he expects no change to come from the new ownership. "Hawai'i will remain as is," Vieira said yesterday.

Vieira said he will continue to deal with Kyo-ya and has had no talks with Cerberus. Vieira added that the Sheraton hotels have always been run by local people regardless of who owned them. "It will be overseen by local Kyo-ya people and they are mostly from Sheraton," he added.

Tokyo-based Kokusai Kogyo, which employs 2,430 people, was founded in 1940, according to its Web site. The company operates bus and taxi services in Tokyo and Osaka and owns three hotels and two golf courses in Japan.

Kokusai president Takamasa Osano will remain as president and Cerberus plans to put its own staff on the company's board of directors, Kokusai Kogyo spokesman Hiroki Inoue said.

Kokusai Kogyo will cancel its existing stock and sell 65 percent of a new share issue to Cerberus, Inoue said. Kokusai's Osano will buy the remaining 35 percent stake, said Inoue, who declined to disclose a price for the sale.

The sale will enable UFJ Holdings Inc. and other lenders to recover some of the $4.1 billion of loans owed by Kokusai Kogyo that have turned bad. Osaka-based UFJ widened its loss forecast to $7.3 billion for the year ending March 31 as it attempts to clear bad loans.

Cerberus owns Aozora Bank Ltd., a Japanese lender formerly known as Nippon Credit Bank Ltd.

Louis Forster, president of Cerberus Japan K.K., was unavailable to comment.