Announcement on share transfer of equity method affiliate

May 13, 2021

Kobe Steel, Ltd.

Kobe Steel, Ltd. announces that it has sold 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). Kobe Steel sold 1,650,000 shares through a negotiated transaction. With this sale of shares, Kobe Steel’s ownership ratio of voting rights in OTC has decreased from 19.43% to 14.95%, which led to the exclusion of OTC from the equity-method affiliates of Kobe Steel.

The shares sold in this transaction are 1,650,000 shares for which the selling method was undetermined in the Announcement of Planned Share Transfer of Equity Method Affiliate, as of January 29, 2021.

1. Number of shares sold, status of shares before/after the sale, and selling method

(1) Number of shares sold 1,650,000 shares
(ownership ratio of voting rights: 4.48%)
(2) Number of shares before the sale 7,150,000 shares
(ownership ratio of voting rights: 19.43%)
(3) Number of shares after the sale 5,500,000 shares
(ownership ratio of voting rights: 14.95%)

2. Outline of the equity-method affiliate 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 Nippon Steel Corporation: 19.43%
Kobe Steel, Ltd.: 14.95%
Sumitomo Corporation: 2.35%
(8) Relationship between the listed company and the company concerned Capital relationship Kobe Steel holds 14.95% 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 2019 Year ended March 2020 Year ended March 2021
Net assets 34,305 million yen 34,921 million yen 29,708 million yen
Total assets 80,928 million yen 76,518 million yen 77,743 million yen
Net assets per share 932.23 yen 948.99 yen 807.32 yen
Net sales 43,666 million yen 38,189 million yen 17,053 million yen
Operating income 2,308 million yen 1,152 million yen △3,425 million yen
Ordinary income 2,422 million yen 1,322 million yen △2,843 million yen
Net income △1,322 million yen 736 million yen △5,083 million yen
Net income per share △35.95 yen 20.02 yen △138.15 yen
Dividend per share 5 yen 5 yen 0 yen

3. 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 becomes clear.

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