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Niinami suspected of purchasing supplements with THC,

media

report

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He told company he believed he purchased legal supplements

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Niinami advised Japanese prime ministers, often served as

the

face of corporate Japan

(Recasts and writes through with Niinami achievements, media

reports on THC allegation)

By Anton Bridge and Mariko Katsumura

TOKYO, Sept 2 (Reuters) - Suntory Holdings CEO Takeshi

Niinami, one of Japan's best-known business leaders, has

resigned from the beverage group following a police

investigation into his purchase of a supplement that may have

breached the country's strict drug laws.

Niinami, who has served as an adviser to several Japanese

prime ministers and was often the face of corporate Japan at

Davos and other international events, told Suntory he purchased

the supplement believing it was legal, the company said on

Tuesday.

The Tokyo Shimbun daily reported that police in Fukuoka

prefecture are investigating whether supplements containing

cannabis components had been sent to Niinami's home - a probe

that is connected to a man who was arrested in July.

Other Japanese media said the supplements allegedly

contained THC, the psychoactive component of cannabis, which is

illegal in Japan. CBD, a separate chemical compound from the

cannabis plant, however, is legal, and products containing it

are available in Japan.

Suntory, which makes whisky, beer and soft drinks

such as Orangina-branded soda, said Niinami told the company he

was the subject of a police investigation on August 22. He

resigned on September 1.

Reuters was not able to immediately reach Niinami for

comment.

Niinami, 66, significantly expanded Suntory's revenue and

profits, joining the drinks maker as president in 2014 shortly

after it purchased U.S. spirits company Beam for $16 billion,

including debt.

"He was a bold, decisive leader who got things done and I

truly respected him," Suntory President Nobuhiro Torii told a

press briefing.

"In that respect - and I told this to him yesterday as well

- it's a real shame that we couldn't continue as a team," he

said.

Torii, a former banker and great-grandson of Suntory founder

Shinjiro Torii, said he would now be fully helming the company.

According to Tokyo Shimbun, police questioned Niinami

and searched his Tokyo home, but no illegal drug possession or

use has been confirmed.

A Fukuoka Police official was not immediately available to

comment on the reports.

Niinami, a fluent English speaker, is chair of the powerful

Keizai Doyukai business lobby. Known for being outspoken, he

wasn't hesitant to voice his opinion on how Japan's economy

should be managed or how the central bank should act.

Keizai Doyukai officials were not immediately available for

comment.

A graduate of Harvard Business School, he was previously

chief executive of convenience store operator Lawson before

becoming Suntory's president, the first head of the firm from

outside its founding family.

Japan has strict drug laws. Late last year, Japanese

endoscope manufacturer Olympus Corp ( OCPNF ) sacked then-CEO

Stefan Kaufmann after an allegation that he had purchased

illegal drugs.

In 2015, police arrested Toyota Motor ( TM ) executive

Julie Hamp, an American, on suspicion of illegally importing the

painkiller oxycodone into the country. She was later released.

Suntory is not publicly traded but shares in a listed unit,

Suntory Beverage & Food ( STBFF ), which manages its

non-alcoholic beverages and food products business, were not

overly affected, ending Tuesday up 3%.