Hitachi, TOKICO and Hitachi Unisia Automotive Sign Merger Agreement
TOKYO--May 2, 20045, 2004--Hitachi, Ltd. ('Hitachi'), TOKICO LTD. ('TOKICO') and Hitachi Unisia Automotive, Ltd. ('Unisia') announced that they have signed a merger agreement today. This agreement is based on merger memorandum of understanding dated March 26, 2004. 1. Overview of the Merger Agreement
(1) Method used for merger
As the surviving company, Hitachi will absorb TOKICO and
Unisia, which will be dissolved thereafter. Shares of TOKICO
will be de-listed as of September 27, 2004.
(2) Merger ratio
Hitachi and TOKICO asked Nomura Securities Co., Ltd. ('Nomura
Securities') and KPMG Corporate Finance K.K. ('KPMG'),
respectively, to calculate proposed merger ratios. Based on
discussions by Hitachi and TOKICO with reference to the
results of these proposals, the two companies agreed on the
merger ratio as follows:
Company Hitachi TOKICO
-------------------- ---------------------- ----------------------
Merger ratio 1 0.521
-------------------- ---------------------- ----------------------
Hitachi shares will not exchange its shares for those of
Unisia because Unisia is a wholly owned subsidiary of Hitachi.
Notes
1. Stock allocation ratio
-- 0.521 Hitachi shares will be allotted for every 1
TOKICO share held. However, this may change based on
discussions among the three companies if there is a
significant change in the three companies' financial
position between now and the merger date.
-- No allocation will be made with respect to 26,952,434
shares of TOKICO common stock held by Hitachi.
-- Hitachi will use treasury stock instead of issuing new
shares for all the shares allocated at the time of
this merger.
2. Calculation methods and basis of calculations used by
third parties
Nomura Securities used the market value method with
respect to Hitachi, and the market value, peer company
comparison and discounted cash flow methods with respect
to TOKICO. Nomura Securities calculated a merger ratio
proposal based on a comprehensive analysis using these
results.
KPMG used the market value method with respect to Hitachi,
and the market value, discounted cash flow and the
adjusted net worth methods for TOKICO. KPMG calculated a
merger ratio proposal based on a comprehensive analysis
using these results.
3. New Hitachi shares issued as a result of this merger
No new shares will be issued because Hitachi will use its
treasury stock.
(3) Payments
Hitachi will pay 4 yen per 1 TOKICO share held as an
equivalent to TOKICO's interim dividend from April 1, 2004 to
September 30, 2004, within three months of the date of merger
to shareholders recorded in TOKICO's register of shareholders
and beneficial shareholders or registered rights holders at
the end of the day prior to the merger date. However, this may
change based on discussions between Hitachi and TOKICO if
there is a significant change in TOKICO's financial position
between now and the merger date.
(4) Capital Stock
There will be no increase in the capital of Hitachi.
There are no changes in the names, business activities, head
office or CEOs.
2. Schedule for the merger
May 25, 2004 Conclusion of merger agreement (Board of
Directors)1/
(1/Approval by executive officers at Hitachi,
and resolution by Board of Directors at TOKICO
and Unisia)
June 16, 2004 Approval of merger agreement at ordinary
general meeting of shareholders (Unisia)
June 25, 2004 Approval of merger agreement at ordinary
general meeting of shareholders (TOKICO)
August 20, 2004 Public notice and individual notices of
submission of TOKICO share certificates
(tentative)
September 27, 2004 Delisting of TOKICO shares from the Tokyo
Stock Exchange
September 30, 2004 Deadline for submission of TOKICO share
certificates
October 1, 2004 Date of merger (tentative)
Early October 2004 Registration of merger (tentative)
Hitachi will merge the two companies without approval of the general meeting of shareholders' of the merger agreement, pursuant to the regulations of Article 413-3, Paragraph 1 of the Commercial Code of Japan.
About Hitachi, Ltd.
Hitachi, Ltd. , headquartered in Tokyo, Japan, is a leading global electronics company, with approximately 326,000 employees worldwide. Fiscal 2003 (ended March 31, 2004) consolidated sales totaled 8,632.4 billion yen ($81.4 billion). The company offers a wide range of systems, products and services in market sectors, including information systems, electronic devices, power and industrial systems, consumer products, materials and financial services. For more information on Hitachi, please visit the company's Web site at http://www.hitachi.com.
About TOKICO LTD.
TOKICO LTD. located principally in Kanagawa, Japan, is a leading and global company, with approximately 4,300 employees working worldwide. In fiscal 2003 (ended March 31, 2004) consolidated sales totaled 125.1 billion yen ($1.1 billion). The company offers automotive parts, measurement and control systems, pneumatic equipment and services therefore in the world. In the field of automotive parts, TOKICO is a manufacturer in an exceptional position manufacturing and selling both suspension systems and brake systems. Using such position to advantage, TOKICO is engaged in and promoting development of various products that makes vehicles safe, comfortable and environmentally friendly. For more information on TOKICO, please access the company's Web site at http://www.tokico.co.jp.
About Hitachi Unisia Automotive, Ltd.
Hitachi Unisia Automotive, Ltd., headquartered in Atsugi, Kanagawa, Japan, is a wholly owned subsidiary of Hitachi, Ltd. and one of the world's leading automotive parts suppliers, with fiscal 2002 (ended March 31, 2003) unconsolidated sales totaled 173.8 billion yen ($1.6 billion). The company manufactures and markets products, including engine components, engine management systems, anti-lock braking systems and power steering systems.