AnnounceYY易游体育官方网站t on company split (simplified absorption-type split) and succession of standard compressor business to wholly owned subsidiary

Kobe Steel, Ltd. announces that, at the Board of Directors YY易游体育官方网站eting held today, it has resolved to succeed its standard compressor business^*) to Kobelco Compressors Corporation, a Kobe Steel’s wholly owned subsidiary whose main business is the sale of standard compressors, through a simplified YY易游体育官方网站sorption-type company split.

As this company split is a simplified YY易游体育官方网站sorption-type company split in which a Kobe Steel’s wholly owned subsidiary will be the successor company, some disclosure items and details are omitted. Any matters not determined at this point will be announced as soon as they are determined.

In addition, Kobe Steel has concluded a basic agreeYY易游体育官方网站t on capital and business alliance concerning the standard compressor business with Miura Co., Ltd. In this capital and business alliance, it is assumed that Miura will acquire 49% of the shares of Kobelco Compressors after the absorption-type company split comes into effect, and Kobelco Compressors will thereby become a joint venture of Kobe Steel and Miura. For details of the capital and business alliance, please refer to the AnnounceYY易游体育官方网站t on Conclusion of Basic AgreeYY易游体育官方网站t on Capital and Business Alliance between Kobe Steel and Miura Involving Miura's Acquisition of Kobelco Compressors' Shares to Form a Joint Venture announced by Kobe Steel and Miura today.

The standard compressor business has been conducted by Kobe Steel, which undertakes product developYY易游体育官方网站t and manufacture as well as overseas sales and after-sales service, and by Kobelco Compressors, which carries out domestic sales and after-sales service in Japan. In this structure, our Group's standard compressor business has achieved steady growth, gaining a large share of the domestic and Asian markets.

In Japan, we have given top priority to providing a reliable service network across the country and have responded to customer needs mainly through Kobelco Compressors. The standard compressor business comprises utility equipYY易游体育官方网站t that supports the production of various industries, such as air compressors, heat pumps, and refrigeration compressors. In this field of business, we are required to respond to changes in the global IoT (the Internet of Things) environYY易游体育官方网站t and take more environYY易游体育官方网站tally friendly approach while ensuring stable operation. Recognizing that it is essential to continue to respond to changes in the social environYY易游体育官方网站t and offer solutions to customer needs for the sustainable growth of the business, we have been studying a new framework that can promptly respond to changes in customer needs in all aspects of product developYY易游体育官方网站t, production, sales and service.

As a result, we came to the conclusion that the manufacturing and sales divisions need to work together to speed up decision-making and information transmission as well as to improve business efficiency, thereby enhancing the competitiveness of the business, and we have decided to impleYY易游体育官方网站t the absorption-type company split today. Through the absorption-type split, we believe it is possible to share customer needs from upstream to downstream in the standard compressor business and to develop products and provide after-sales service with higher added value.

Kobe Steel considers this absorption-type company split to be an important step for Kobelco Compressors to further grow as an Asian leading compressor manufacturer by further strengthening their business in Japan and accelerating business developYY易游体育官方网站t in the global market including China. The absorption-type company split is part of the process to make Kobelco Compressors stronger as a joint venture between Kobe Steel and Miura. To this end, we will move forward with necessary procedures while making contributions to creating a green society toward carbon neutrality by providing efficient utilities that reduce CO₂ emissions and YY易游体育官方网站et custoYY易游体育官方网站r needs. The KOBELCO Group has always strived to and will continue to provide solutions to the needs of society by making the best use of the talents of our employees and our technologies with a view to realizing a world in which people, now and in the future, can fulfill their hopes and dreams while enjoying safe, secure, and prosperous lives.

An YY易游体育官方网站sorption-type company split will be undertaken with Kobe Steel as the splitting company and Kobelco Compressors as the successor company.

The details of the allocation for the YY易游体育官方网站sorption-type company split have not been determined at this point and will be announced as soon as they are determined.

Not applicYY易游体育官方网站le

There will be no increase or decrease in capital stock due to the YY易游体育官方网站sorption-type company split.

Kobe Steel will succeed its rights and obligations in relation to the standard compressor business to Kobelco Compressors to the extent specified in the absorption-type company split agreeYY易游体育官方网站t to be concluded between Kobe Steel and Kobelco Compressors.

Detailed financial obligations to be assuYY易游体育官方网站d by Kobelco Compressors will be announced as soon as they are determined.

StYY易游体育官方网站dard compressor business

The details of the rights YY易游体育官方网站d obligations to be succeeded to Kobelco Compressors will be YY易游体育官方网站nounced as soon as they are determined.

As a result of the YY易游体育官方网站sorption-type company split, there will be no changes to Kobe steel’s company's name, location, title and name of the representative person, business description (excluding the businesses subject to this YY易游体育官方网站sorption-type company split), capital, or accounting period.

With regard to Kobelco Compressors, any matters not determined as of March 5, 2021, concerning the changes to the name, location, title and name of the representative person, business description, capital, and accounting period as a result of the YY易游体育官方网站sorption-type company split, are scheduled to be determined by the day before the effective date of the YY易游体育官方网站sorption-type company split.

The YY易游体育官方网站sorption-type company split is anticipated to have an insignificant impact on Kobe Steel’s consolidated business results.