Note) This translation is prepared and provided for readers' convenience only. In the event of any discrepancy between this translated document and the original Japanese document, the original document shall prevail.
August 9, 2012 To Whom It May Concern,
Company name: Dai Nippon Printing Co., Ltd. Representative: Yoshitoshi Kitajima, President Code: 7912, Tokyo Stock Exchange First Section Contact: Yoshio Kanbe, General Manager, Press and Public Relations TEL：+81-3-5225-8220
Company name: Nihon Unisys, Ltd. Representative: Shigeru Kurokawa, President & CEO Code: 8056, Tokyo Stock Exchange First Section Contact: Katsuhiro Ohtomo, Corporate Officer, General Manager, Corporate Communications TEL: +81-3-5546-7404
Notice pertaining to Business Alliance between Dai Nippon Printing Co., Ltd. and Nihon Unisys, Ltd.
Dai Nippon Printing Co., Ltd. ("Dai Nippon Printing") and Nihon Unisys, Ltd. ("Nihon Unisys") hereby announce that the two companies have decided to conclude the "Business Alliance Agreement" (the "Alliance Agreement") at a meeting of board of directors respectively convened on August 9, 2012. (A business alliance pursuant to the Alliance Agreement is referred to as the "Alliance".)
1. Rationale for the Alliance The Dai Nippon Printing Group has deployed "P&I Solutions", solutions capable of addressing various types of issues of companies, consumers and even society on the basis of the strengths of their printing technology and information technology. The Group has produced printed matters for various fields such as publication, advertisement and mail order. Furthermore, the Group has come to create websites and digital contents such as digital books, electronic catalogs and electronic fliers, and even plan, develop and operate various types of systems. The Group has considered the development and strengthening of their IT infrastructure, on the basis of the conviction that enhancement of a broad range of their IT resources and expertise is critical in order to respond to the rapidly evolving IT society. The Nihon Unisys Group has endeavored to enhance their revenue base as described in the Mid-Term Management Plan （ 2012→2014 ） announced in December, 2011 under the management concept of sharing values with their customers (U&U®:Users&Unisys). The Group established in this plan a mid-term vision consisting of the three points: “to become the No.1 partner capable of achieving the optimization of ICT”, “to become a partner capable of providing added values to customers by leveraging ICT” and “to become a partner capable of contributing to the provision of social infrastructures by utilizing ICT”. With respect to the cloud-computing business that the Group launched in order to establish a stable revenue base in 2008, the Group has taken the initiative in starting a cloud-computing market through their deployment efforts targeting enterprise systems that demand high quality. This has been enabled attributable to the experiences that the Group has accumulated through the provision of a one-stop service that encompasses the development, operation and maintenance/support for mission-critical systems. Also, the Group has created new types of businesses in coordination with business partners of different industries with an eye to further revenue increase.
1 Against the backdrop that smart-phones and digital contents as well as cloud-computing services have begun to spread in society, company management, work style and consumers’ life style are on the verge of drastic changes. The two companies sharing this understanding of the environment continued reviews and deliberations on various measures that would enhance their mutual corporate values. In the course of the discussions, the two companies reached the conclusion that they would contribute to the enhancement of their mutual corporate values through the market deployment of new services that would hugely advance the consumers’ living and business management. This will be only enabled on the basis of the mutual expertise coordination between the two, sharing Dai Nippon Printing’s knowhow in the fields of information communication, lifestyle and industrial supplies and electronics and the cloud-computing technologies and service development expertise of Nihon Unisys. Thus, the companies decided to conclude the Alliance Agreement. Dai Nippon Printing and Nihon Unisys, strategic partners, will develop various new types of businesses through the Alliance.
2. Contents of the Alliance The companies will strengthen the coordination on the basis of three points, cloud-computing businesses, new platform service businesses, and marketing and sales coordination. Concrete measures will be decided sequentially to start considerations in each of the fields in future.
① Cloud-computing Businesses Dai Nippon Printing and Nihon Unisys will start a cloud platform which will form a business base for enhancement of new services through a quick and cost-effective approach. The two will expand the businesses through the coordination in the Dai Nippon Printing’s business fields of marketing and sales promotion and digital contents such as electronic publishing. Also, the two aim to create a comprehensive platform which places the Big data and cloud platform as the core.
【Items of Implementation】 1. Start of new shared cloud platform and creation of multi-cloud platform through the coordination between the two companies 2. Enhancement of various types of services and systems through the use of cloud platform 3. Improvement and deployment of PaaS（Platform as a Service） 4. Coordination and mutual complement between the IDCs (Internet Data Centers) of the two companies 5. Joint procurement of digital devices such as servers 6. Implementation of R&D toward an expansion of joint businesses
② New Platform Service Businesses The two companies will take the lead in creating and expanding markets through the joint efforts of planning, developing and operating new platform services that consist of combined system components as well as people-to-people exchange. This will be achieved on the basis of the Dai Nippon Printing’s capabilities pertaining to marketing and cross-media planning/development and contents creation expertise for the information communication field and Nihon Unisys’ capabilities of infrastructure development, system application development and operation.
【Items of Implementation】 1. Planning and development of new platform service businesses 2. Creation and operation of new platform services 3. Promotion of people-to-people exchange through to planning, development and operation of applications and services
③ Marketing and Sales Coordination The two companies will combine their markets and products/services that they have
2 already had, and implement mutual deployment in order to increase the size and productivity of their system service businesses. Furthermore, they will aim to expand new markets through the efforts of reusing the products/services, thereby providing total solutions capable of addressing issues of consumers and businesses.
【Items of Implementation】 1. Increase in business size through the mutual coordination of sales efforts in the business fields of Dai Nippon Printing, information communication, lifestyle and industrial supplies and electronics as well as the various fields of Nihon Unisys 2. Reuse for new platform service businesses Sales promotion pertaining to device solutions and multi-media platform of Dai Nippon Printing as well as e-commerce platform and analytics solutions of Nihon Unisys, among others
3. Others Dai Nippon Printing today concluded the “Share Transfer Agreement” （the “Share Transfer Agreement”）that 20,726,410 shares of common stock, approx. 18.90% (ratio of voting rights: approx. 22.08%) of the total number of issued shares of Nihon Unisys would be transferred to Dai Nippon Printing from Mitsui & Co., Ltd. (“Mitsui”), the largest shareholder of Nihon Unisys． As a result, it is expected that there will be a change pertaining to the major shareholders, the largest major shareholder and other affiliated companies of Nihon Unisys. Also, Nihon Unisys will become an equity method affiliate of Dai Nippon Printing. With respect to the changes concerning the major shareholders etc., please also refer to the announcements separately released as of today, the “Notice of Acquisition of the Shares of Nihon Unisys, Ltd.” by Dai Nippon Printing and the “Notice of Scheduled Changes in the Major Shareholders, the Largest Major Shareholder and Other Affiliated Companies, and Offering of Shares” by Nihon Unisys.
3 4. Summary of the Parties pertaining to the Alliance (as of August 9, 2012, unless otherwise dated) (1) Name Dai Nippon Printing Co., Ltd. Nihon Unisys, Ltd. (2) Location 1-1-1, Ichigaya Kagacho 1-1-1 Toyosu, Koto-ku, Tokyo, Japan Shinjuku-ku, Tokyo, Japan (3) President Yoshitoshi Kitajima Representative Director, President & CEO Representative Shigeru Kurokawa (4) Description of Printing business etc. Provision of consulting services, IT Business solution, outsourcing services, support services and system-related services sales of computer systems (including hardware and software) (5)Capital 114,464 million yen 5,483 million yen (6)Establishment January 19, 1894 March 29, 1958 Date (7) The Master Trust Bank of Japan, 5.73% Mitsui & Co., Ltd. 27.84% Large Ltd. (Trust Account) Japan Trustee Services 5.49% Shareholders Japan Trustee Services Bank, Ltd. 4.46% Bank, Ltd. (Trust Account) and (Trust Account) The Norinchukin Bank 4.24% Shareholding The Dai-ichi Life Insurance 4.41% Nihon Unisys Employees' 3.10% Ratio Company, Limited Shareholding Society (as of March 31, The Bank of New York Mellon as 3.82% The Master Trust Bank of 2.91% 2012) Depositary Bank for Depositary Japan, Ltd. (Trust Account) Receipt Holders All Nippon Airways Co., Ltd. 1.64% Mizuho Corporate Bank, Ltd. 2.18% Morgan Stanley & Co. 1.30% Nippon Life Insurance Company 2.05% International plc Employees’ Shareholding Society 1.95% Morgan Stanley & Co. LLC 1.16% of Dai Nippon Printing, Ltd. The Master Trust Bank of 1.16% SSBT OD05 OMNIBUS ACCOUNT 1.83% Japan, Ltd. (Retirement - TREATY CLIENTS Benefit Trust Mizuho Bank, Ltd. 1.78% Account/Mitsubishi Electric Japan Trustee Services Bank, Ltd. 1.06% Corporation Account) (Trust Account 9) State Street Bank and Trust 1.03% Company 505225 (8) Relationship between the Parties Capital Dai Nippon Printing owns 1,000 shares of the common stock of Nihon Unisys. Relationship Nihon Unisys owns 107,625 shares of the common stock of Dai Nippon Printing. There is no personnel relationship to note between the two companies. Nor are there any Personnel personnel relationships to note between personnel concerned or companies affiliated with Relationship one party and the counterparts of the other party. Transactional There is a business relationship between the two companies. Relationship Status of The two parties are not related parties for each other. The personnel concerned and Related Parties companies affiliated with one party are not related parties for the other party, and vice versa. (9) The Performance Results and Financial Positions of the Past Three Years (Millions of yen, except per-share amounts) Dai Nippon Printing (consolidated) Nihon Unisys （consolidated） Fiscal Years ended March 31 FY2010 FY2011 FY2012 FY2010 FY2011 FY2012 Net Assets 956,863 952,440 914,213 76,927 76,770 63,233 Total Assets 1,618,853 1,649,784 1,608,806 218,066 207,282 190,083 Net Assets per Share (Yen) 1,422.34 1,410.44 1,352.71 787.12 803.52 658.90 Net Sales 1,583,382 1,589,373 1,507,227 271,084 252,989 255,122 Operating Income 66,513 67,818 34,015 7,105 6,527 7,310 Ordinary Income 68,841 62,786 36,843 6,918 5,833 7,096 Net Income 23,278 25,032 △16,356 3,626 2,574 △12,498 Net Income per Share (Yen) 36.13 38.86 △25.39 37.82 27.12 △132.99 Cash Dividend per Share (Yen) 32.00 32.00 32.00 10.00 10.00 5.00
4 5. Schedule August 9, 2012 Approval of the Alliance Agreement by the Board of Directors (of the two companies) Conclusion of the Alliance Agreement (between the two companies) Conclusion of the Share Transfer Agreement (between Dai Nippon Printing and Mitsui) August 22, 2012 (scheduled) Transfer of the common stock of Nihon Unisys (to Dai Nippon Printing)
6. Future Prospect Dai Nippon Printing and Nihon Unisys will independently announce effects of the Alliance on their business results for the fiscal year ending March 2013, promptly if necessary.
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