PURPOSE: To industrially effectively prepare the subject derivative which is effectively used in the preparation of diltiazem, by cyclizing an ester of 2- hydroxy-3-(4-R3-phenyl)-3-(2-aminoarylthio)propionic acid in the presence of a base in an aprotic polar solvent.

CONSTITUTION: A compound of formula I (R1 and R2 are each H, halogen, 1-16C alkyl or the like; R4 is 1-20C residue; R3 is H, hydroxy, 1-6C alkoxy) is cyclized in the presence of a base of alkali metal alkanolate (preferably sodium methoxide or the like), in an aprotic polar solvent (preferably N,N- dimethylformamide or the like), in an aprotic polar solvent (preferably N,N- dimethylformamide or the like), preferably at a temp. of -10 through 15°C under an inert atmosphere, to prepare the objective derivative represented by formula II, e.g. (2X,3Y)-2-pheyl-3-hydroxy-2,3-dihydro-1,5-benzothiazepin-4(5H)-one (X and Y are each R or S configuration).