The chairman of Japan's troubled Nissan Motor Co, which is in talks with France's Renault, admitted yesterday his mishandling of heavy debts drove the firm into a desperate search for foreign help.

"Up until a few years ago, the holding of large liabilities with interest in Japan was not necessarily a problem in management," Mr Yoshifumi Tsuji told a news conference. "But it is becoming clear that the idea does not work," he said. Many other Japanese firms and banks have suffered as debts swelled after the collapse of the bubble economy in the early 1990s.

Japanese media said the remarks indicated Mr Tsuji was ready to resign once Nissan strikes a final deal with Renault.