| 1. Purpose of TOB |
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Osaka Media Port Corporation, the target company of TOB, (hereinafter referred to as the "target company") is a company operating IT/Communications business and of which Kansai Electric Power Co., Inc. is currently the largest shareholder (holding 25.65% of issued shares of the company). As Kansai Electric Power Group, we have been promoting integrated IT/Communications business specialized in regional and IP services. In October 2001, the target company, which principally operates corporate service in the group, transferred large part of its business to Poweredcom, Inc. through corporate division of the target company in order to address to the needs for IP service for corporate customers that must be provided nation-wide. The target company now serves as a regional service provider that is specialized in providing subscriber lines mainly for Poweredcom, Inc.
However, the business environment of IT/Communications has been changing rapidly much more than we expected due to the demands for high speed and low cost service. We are under a severe environment of telecommunication business.
In such a situation, we have resolved to integrate business resources of our group and respond to the environmental changes more speedy to survive the great competition. In order to achieve this, it is necessary for us to improve group structure so that we can operate the group flexibly and maximize the synergy. Therefore, we have decided to implement the TOB to have the target company to be a 100% subsidiary of Kansai Electric Power Co., Inc.
The board of directors of the target company has expressed their approval for our implementation of this TOB. |
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| 2. Outline of TOB (as of September 30, 2002) |
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(1) Outline of the target company |
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1. Registered company name: |
Osaka Media Port Corporation |
| 2. Main business: |
Telecommunication (Type ?) |
| 3. Date of establishment: |
October 12, 1985 |
| 4. Head office: |
6-2-27 Nakanoshima, Kita-ku, Osaka, Japan |
| 5. Company representative: |
Shunichi Ito, President & CEO |
| 6. Capital : |
24 billion yen |
| 7. Composition of major shareholders and shares held: |
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Kansai Electric Power Co., Inc. (shares held: 26.65%)
Osaka City (shares held: 25.00%)
Osaka Gas Co., Ltd. (shares held: 6.50%) |
| 8. Relationship with Kansai Electric Power Co., Inc. |
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(capital)
(personal) |
Kansai Electric Power Co., Inc. is holding 26.65% of the total issued shares of the target company.
Kansai Electric Power Co., Inc. has sent 1 director, 1auditor, and 46 employees (on loan) to the target company. |
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(2) Class of stock to be purchased: common stock |
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(3) Period of TOB |
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Twenty-one days from February 27, 2003 (Thursday) and through March 19, 2003 (Wednesday) |
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(4) Purchase price |
50,000. yen per share |
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(5) Basis of calculation for assessment of purchase price: |
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Calculated based on the market value of net assets and the Discounted Cash Flow (DCF) method (an approach to calculate the value of a company by estimating cash flow of the company at a certain point in the future and figure out its present value from it). |
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(6) Aggregate number of shares to be purchased: |
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Number of shares planned to be purchased:
Number of shares to excess:
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356,900 shares
None |
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Even if the total number of shares subscribed does not reach the number planned to purchase, the buying of all the shares subscribed will be implemented. |
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(7) Change of number of owned stock through TOB |
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Number of owned stock prior to TOB:
Number of owned stock after TOB:
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123,100 shares (shares held: 25.65%)
480,000 shares (shares to be held: 100.00%) |
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The number of shares after TOB above is the number figured out at the time of purchasing 356,900 shares through TOB. Aggregate number of issued shares of the target company is 480,000 shares (as of September 14, 2002). |
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(8) Date of public notice of commencement of TOB |
Thursday, February 27, 2003 |
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(9) Agent for TOB: |
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Nomura Securities Co., Ltd. 1-9-1 Nihonbashi, Chuo-ku, Tokyo, Japan |
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(10) Estimated cost for TOB |
18 billion yen (Estimated value) |
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(11) Commencing date of settlement |
March 28, 2003 (Friday) |
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| 3. Outlook |
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Upon completion of the process of TOB, the target company will be a consolidated subsidiary of Kansai Electric Power Co., Inc. The impact of this transaction on the business results of Kansai Electric Power Co., Inc. and its consolidated companies for the period ending in March 2003 will be slight.
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2003
