Announcement on conclusion of investment agreement and shareholders agreement on capital and business alliance between 易游游戏官网 Steel and Miura involving Miura's acquisition of 易游游戏官网lco Compressors' shares to form a joint venture

易游游戏官网 Steel, Ltd. announces that 易游游戏官网 Steel and Miura Co., Ltd., pursuant to the resolution of their respective Board of Directors meeting held today, have concluded an investment agreement concerning Miura’s investment in 易游游戏官网 Steel’s wholly owned subsidiary 易游游戏官网lco Compressors Corporation and 易游游戏官网 Steel’s investment in Miura, as well as a shareholders agreement concerning 易游游戏官网lco Compressors (hereinafter, the two agreements are collectively called “the final agreements”).

As announced in the “Announcement on Conclusion of Basic Agreement on Capital and Business Alliance between 易游游戏官网 Steel and Miura Involving Miura's Acquisition of 易游游戏官网lco Compressors' Shares to Form a Joint Venture” as of March 5, 2021, 易游游戏官网 Steel and Miura have been proceeding with detailed discussions for the capital and business alliance concerning the standard compressor^*) business involving Miura’s acquisition of 易游游戏官网lco Compressor’s shares. As a result of discussions, the two companies have reached an agreement to implement the capital and business alliance today.

The standard compressor business of 易游游戏官网 Steel and its wholly owned subsidiary 易游游戏官网lco Compressors Corporation has a high market share in Japan and the Asian region and has provided a stable supply of high-quality compressors to various industries.

Miura has a high reputation in Japan as a forerunner of 易游游戏官网ergy-saving and eco-fri易游游戏官网dly boilers. Miura holds a high share in the industrial once-through boiler market.

Since 2008, 易游游戏官网 Steel and Miura have jointly developed steam-driven compressors that use steam as a power source to produce compressed air, and since then the companies have developed steam generators and waste heat recovery compressors. By utilizing the exhaust heat from air compressors in boilers, the companies have significantly reduced the energy consumption required for boiler operation.

The collaboration of 易游游戏官网 Steel and Miura will enable further energy saving and reductions of CO₂ emissions through supplying utility equip易游游戏官网t that combines technologies developed in the fields of steam and air. For example, the running costs can be reduced by 36% and CO₂ emissions by 36% in main products. The companies will also work toward the realization of one-stop services utilizing their sales and after-sales service networks.

To date, 易游游戏官网 Steel and Miura have been collaborating in business without a capital relationship, but the companies came to the recognition that strengthening the partnership would leverage the synergies as described above and enhance the competitiveness of both companies, which commonly handle the utilities of air and steam, as they make more effective use of each other's resources through the alliance described in Section 2 (Outline of the Capital and Business Alliance) below. Based on this perspective, 易游游戏官网 Steel and Miura agreed to proceed with specific discussions toward the capital and business alliance and have now reached an agreement to implement the capital and business alliance. The two companies have respectively decided to conclude the final agreements today.

易游游戏官网 Steel and Miura believe that the realization of the capital and business alliance will be the beginning for 易游游戏官网lco Compressors to further grow as the leading standard compressor manufacturer in Asia.

The 易游游戏官网 Steel Group, also known as the 易游游戏官网LCO Group, taking advantage of its diverse businesses, aims to provide efficient utilities that reduce CO₂ emissions and meet customer needs in Japan and overseas, mainly for the markets in China and Southeast Asia. It is the mission of the Group to contribute to creating a green society through these technologies toward achieving carbon neutrality by 2050 as declared by the Japanese government. The 易游游戏官网LCO 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.

The Mura Group has been developing businesses in the fields of heat, water treat易游游戏官网t and environ易游游戏官网tal science with steam boilers as the core products, and has been providing solutions and products to improve the efficiency of energy systems of the entire plant through the effective use of heat and water, including the effective use of unused heat. In the future, the Miura Group will continue to create innovative products and systems that will reduce environ易游游戏官网tal impact in response to global issues related to reduction of greenhouse gas emissions, energy conservation, and other areas. As envisioned in its corporate philosophy, the Miura Group will continue to contribute to creating a society that is environ易游游戏官网tally friendly and lifestyles that are clean and comfortable through business in the fields of energy, water, and the environ易游游戏官网t, with the aim of becoming the best partner not only for customers in Japan but also for customers around the world.

Currently, 易游游戏官网 Steel undertakes the development, manufacturing, and overseas sales/after-sales service of standard compressors, while 易游游戏官网lco Compressors undertakes the sale and after-sales service of standard compressors in Japan. 易游游戏官网 Steel has decided to integrate the standard compressor business into 易游游戏官网lco Compressors by transferring the development, manufacturing, and overseas sales/after-sales service of standard compressors to 易游游戏官网lco Compressors through an absorption-type company split and other measures. For details of the company split, please refer to the “Announcement on Company Split (Simplified Absorption-Type Split) and Succession of Standard Compressor Business to Wholly Owned Subsidiary”, announced by 易游游戏官网 Steel on May 17, 2021.

In this framework, Miura will acquire 49% of the shares of 易游游戏官网lco Compressors by undertaking a third-party allotment of 易游游戏官网lco Compressors’ shares, and 易游游戏官网lco Compressors will thereby become a joint venture of 易游游戏官网 Steel and Miura.

Miura's investment in 易游游戏官网lco Compressors amounts to approximately 13.7 billion yen, of which approximately 1.7 billion yen will be appropriated from the money to be provided for Miura from 易游游戏官网 Steel, which undertakes treasury stock disposal implemented by Miura, by means of a third-party allotment to 易游游戏官网 steel as the disposal destination.

Through integrating the standard compressor business into 易游游戏官网lco Compressors and converting the company into a joint venture, 易游游戏官网 Steel and Miura aim to work together to implement strategies centered on the standard compressor business and achieve synergies as described in Section 1 (Reason for the Capital and Business Alliance) above.

If there are any matters to be disclosed regarding the impact on the future business results of 易游游戏官网 Steel and Miura in the course of the discussions on the capital and business alliance and other matters, we will make announcement promptly.