Announcement on planned share transfer of equity method affiliate

January 29, 2021

Kobe Steel, Ltd.

Kobe Steel, Ltd. announces that it has decided to sell a part of shares that it holds in its equity-method affiliate OSAKA Titanium Technologies Co., Ltd. (OTC) (code number 5726: First section of the Tokyo Stock Exchange). The number of shares planned to be sold by Kobe Steel is 3,300, 000 shares. With this sale of shares, Kobe Steel’s ownership ratio of voting rights in OTC will decrease from 23.92% to 14.95%, and it is anticipated that the OTC will be excluded from the equity-method affiliates of Kobe Steel. However, in the event of a significant change in the conditions of the stock market or other unavoidable circumstances, the sale may be suspended, postponed, or canceled.

1. Reason for the sale

The Kobe Steel Group (also known as the KOBELCO Group), under the Rolling of the Medium-Term Management Plan announced on May 15, 2019, has set two key themes for fiscal 2019 and 2020, one of which is to make efficient use of management resources with a focus on capital costs, and is working to improve the efficiency of its capital and assets. As a result of the examination of its shares in OTC, Kobe Steel judged that it would be possible to improve the efficiency of management resources through the sale of a certain number of shares and to continue the business and cooperative relationship with OTC, and thus decided to execute the sale.

2. Number of shares to be sold, status of shares before/after the sale, and selling method

(1) Number of shares planned to be sold 3,300,000 shares (ownership ratio of voting rights: 8.97%), of which 1,650,000 shares will be sold in the market. The selling method for the remaining 1,650,000 shares has yet to be determined.
(2) Number of shares before the sale 8,800,000 shares (ownership ratio of voting rights: 23.92%)
(3) Number of shares after the sale 5,500,000 shares (ownership ratio of voting rights: 14.95%)

3. Outline of the equity-method affiliate to be transferred

(1) Company name OSAKA Titanium Technologies Co., Ltd.
(2) Domicile 1 Higashihama-cho, Amagasaki, Hyogo, Japan
(3) Name of representative & title Yasuaki Sugizaki
President & Representative Director
(4) Description of business
  • Manufacture and sale of titanium (titanium sponge, titanium ingot, etc.)
  • Manufacture and sale of high-performance materials such as high-purity titanium, titanium powder, and SiO, which are products developed for new applications of titanium and silicon
(5) Capital 8,739,620,000 yen
(6) Date of establishment November 26, 1952
(7) Major shareholders & ratio of shareholding
Kobe Steel, Ltd.:
Nippon Steel Corporation:
Sumitomo Corporation:
(8) Relationship between the listed company and the company concerned Capital relationship Kobe Steel holds 23.91% of the shares of the company concerned.
Personnel relationship One auditor of the company concerned is concurrently an employee of Kobe Steel.
Business relationship Kobe Steel purchases titanium sponge and titanium ingot from the company concerned.
(9) Financial status and operating results of the company concerned for the past 3 fiscal years
Accounting period Year ended March 2018 Year ended March 2019 Year ended March 2020
Net assets 36,213 million yen 34,305 million yen 34,820 million yen
Total assets 92,662 million yen 80,928 million yen 76,417 million yen
Net assets per share 984.11 yen 932.23 yen 946.24 yen
Net sales 43,431 million yen 43,666 million yen 38,189 million yen
Operating income 3,322 million yen 2,308 million yen 1,142 million yen
Ordinary income 2,809 million yen 2,422 million yen 1,312 million yen
Net income 1,857 million yen △1,322 million yen 726 million yen
Net income per share 50.47 yen △35.95 yen 19.75 yen
Dividend per share 15 yen 5 yen 5 yen

4. Schedule for the sale

Kobe Steel concluded today a share transfer agreement with a securities company concerning the sale of 1,650,000 shares in the market. The sale is scheduled to begin on February 1, 2021. The date of the sale of the remaining 1,650,000 shares has not been determined yet, and the date of exclusion of the company concerned from our company's equity method affiliates has not been determined either.

5. Future outlook

The impact of the sale of shares that could have on Kobe Steel’s consolidated results is currently under review. Kobe Steel will make an announcement once the impact is clear.

Related Pages

(Note) The information on this web site is presented "as is." Product availability, organization, and other content may differ from the time the information was originally posted. Changes may take place without notice.

Page top