Mitsui Sumitomo Insurance Co.,LTd (“the Company)(President Toshiaki Egashira) resolved at the meeting of its Board of Directors held on February 13, 2007, that the Company subscribe for new shares of stock that Mitsui Direct Songai Hoken Kabushiki-kaisha (Mitsui Direct General Insurance Company, Limited in English translation) (“MDGI”) plans to issue in March 2007 to increase capital and also acquire MDGI's outstanding shares. Here is an outline of the acquisition as follows:
Particulars
| 1. |
Reason for the acquisition:
MDGI has been expanding its business volume since it commenced the operation in June 2000. As a specialized direct marketing non-life insurer, MDGI has focused its business particularly on the new market created by the expanding population of individual Internet users and prides its business model where insurance contracts are completed entirely on the Internet.
MDGI intends this capital increase to improve its financial soundness indicators and to contribute to its capitalization policy in connection with the strategy for further growth. The Company will, subject to approval by the relevant authorities, consolidate MDGI as its subsidiary and assist MDGI in its further effort to stabilize operations and improve performance, through subscription for new shares as MDGI's major shareholder and outstanding shares thereof MDGI's minor shareholders. |
| 2. |
Overview of MDGI (as of February 1, 2007)
| (1) |
Corporate name: |
|
Mitsui Direct Songai Hoken Kabushiki-kaisha
(Mitsui Direct General Insurance Company, Limited) |
| (2) |
Representative: |
|
Toshio Kitamura,
President and Representative Director |
| (3) |
Registered office: |
|
5-3, Kohraku 1-chome, Bunkyo-ward, Tokyo, Japan |
| (4) |
Date of incorporation: |
|
June 3, 1999 |
| (5) |
Line of business: |
|
non-life insurance |
| (6) |
Fiscal year-end: |
|
March |
| (7) |
Number of employees: |
|
576 |
| (8) |
Paid-in capital: |
|
twenty (20) billion Japanese yen |
| (9) |
Number of shares issued: |
|
400,000 |
|
| 3. |
Counterparties of acquisition
| (1) |
The Company will subscribe for 187,500 shares out of 250,000 shares to be issued by MDGI. |
| (2) |
The Company will acquire 47,000 of MDGI's outstanding shares from MDGI's other shareholders. |
|
| 4. |
Number of shares to be acquired and pre- and post-acquisition holdings.
| (1) |
Pre-acquisition holding: |
|
197,560 shares (49.39%) |
| (2) |
Size of acquisition: |
|
234,500 shares (10 billion Japanese yen (planned)) |
| (3) |
Post-acquisition holding: |
|
432,060 shares (66.47%) |
|
| 5. |
Schedule
| February 13, 2007: |
|
The resolution of the Board of Directors |
| Late February 2007: |
|
Acquisition of outstanding shares (planned) |
| Late March 2007: |
|
Subscription for new shares (planned) |
|
| 6. |
Outlook
MDGI will become a subsidiary of the Company and be consolidated for the Company's fiscal year ending March 2007 as a result of the acquisition, etc.. However, the acquisition will not affect the Company’s consolidated earnings forecast for the fiscal year ending March 2007, since MDGI's earnings will first be reflected on the Company's consolidated financial statements for the fiscal year ending March 2008. |
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