TOKYO (AP) _ The president of Japan's largest department store operator said Tuesday he will resign after company executives were arrested on charges of paying gangster extortionists.

Takashimaya Co. president Hiroshi Hidaka said he ``feels responsibility'' over the scandal involving payments to ``sokaiya,'' racketeers who blackmail companies by threatening to disrupt their annual shareholders' meetings.

One former and two current Takashimaya executives were arrested Saturday for allegedly paying 80 million yen ($730,000) to sokaiya to ensure a peaceful annual meeting in May 1995.

Two sokaiya, including the reputed leader of a ``yakuza'' organized crime syndicate, also have been arrested.

Hidaka denied again that he was aware of the payments, but he acknowledged meeting the mob leader, Isao Nishiura, several times.

Japanese media have reported that Takashimaya's dealings with Nishiura went back 10 years and that payments totaled several hundred million yen.

Hidaka, 72, said he will be succeeded as president on July 1 by Tatsuro Tanaka, 61, a senior managing director at the company. Hidaka will remain as a member of the board and senior adviser.

Takashimaya, founded as a kimono shop in Kyoto in 1831, is Japan's oldest and largest department store operator.

The company is opening a new store with 594,000 square feet of floor space in Tokyo's Shinjuku district this October, which may partly account for Hidaka's desire to step aside and quickly install a successor.