NYK hereby announces that, at a meeting of its Board of Directors held today, it resolved, as part of a series of transactions (the “Transactions”), to make NS United Kaiun Kaisha, Ltd. (“NS United Kaiun” or the “Target Company”), an equity-method affiliate of NYK, a consolidated subsidiary, and to make NYK and Nippon Steel Corporation (“Nippon Steel”) the only shareholders of the Target Company, with their shareholding ratios to be set at 83.33% and 16.67%, respectively. The Transactions include the implementation of a tender offer (the “Tender Offer”) for the common shares of the Target Company, subject to the satisfaction of certain conditions precedent, including obtaining clearances for prior notifications under applicable competition laws in Japan, Australia, China, and Brazil (the “Conditions Precedent”). NYK also resolved to enter into a transaction framework agreement and a shareholders’ agreement with Nippon Steel, as well as a tender offer agreement with the Target Company (collectively, the “Material Agreements”).

The Transactions consist primarily of the following:

• The Tender Offer by NYK to acquire all common shares of the Target Company (excluding shares held by NYK and Nippon Steel, and treasury shares held by the Target Company);
• A tender offer for share repurchase to be conducted by the Target Company, subject to the successful completion of the Tender Offer, for the purpose of acquiring a portion of the shares held by Nippon Steel (the “Tender Offer for Share Repurchase”); and
• In the event that NYK is unable to acquire all of the Target Company’s shares through the Tender Offer, a series of squeeze-out procedures to make NYK and Nippon Steel the sole shareholders of the Target Company.

If the squeeze-out procedures are implemented, the shares of NS United Kaiun are expected to be delisted following the prescribed procedures.

For further details regarding the Transactions, including the Conditions Precedent and an overview of the Material Agreements, please refer to the timely disclosure document entitled “Notice Regarding Scheduled Commencement of Tender Offer for Shares of NS United Kaiun Kaisha, Ltd. (Securities Code: 9110)” released today.

Notice Regarding Scheduled Commencement of Tender Offer for Shares of NS United Kaiun Kaisha, Ltd. (Securities Code: 9110)

NS United Kaiun has announced that, at a meeting of its Board of Directors held today, it resolved that, as its current opinion, it will express support for the Tender Offer and recommend that its shareholders tender their shares in the Tender Offer if the Tender Offer is commenced. NS United Kaiun also resolved to conduct the Tender Offer for Share Repurchase, subject to the successful completion of the Tender Offer.

In its medium-term management plan, “Sail Green, Drive Transformations 2026 – A Passion for Planetary Wellbeing –,” announced in March 2023, the NYK Group has pursued an ambidextrous management approach that combines the advancement of existing core businesses with the growth of new business areas. Within this framework, the dry bulk business, which constitutes NS United Kaiun’s core business, has been positioned as one of the NYK Group’s key businesses.

In the meantime, the dry bulk market is highly susceptible to fluctuations in the global economy, resource and energy policies, and geopolitical developments, resulting in significant volatility in freight rates. In recent years, the business environment has undergone substantial changes driven by increasingly stringent environmental regulations, customers’ decarbonization requirements, emerging transportation demand, and labor shortages. NYK believes that, in such an uncertain environment, building a resilient fleet portfolio, responding swiftly to changes in market conditions, and maintaining a consistent long-term business strategy are critical to achieving stable earnings and earning the trust of customers.

NS United Kaiun has a long-standing track record of providing high-quality marine transportation services, particularly in the transportation of steel-related raw materials. NS United Kaiun possesses highly specialized personnel and organizational capabilities, a strong customer base, long-term business relationships built on trust, a proven track record of delivering high-quality transportation services, and robust business foundations in both its international and domestic shipping operations.

Through the consolidation of NS United Kaiun as a subsidiary, NYK seeks not only to incorporate stable earnings supported by key customers, but also to further strengthen collaboration between the two companies. By combining NS United Kaiun’s expertise and proven track record with NYK’s global network, technological capabilities, and diversified business platform, NYK aims to enhance the quality and safety of transportation services, strengthen cost competitiveness, build steel supply chains in overseas growth markets, accelerate decarbonization initiatives, and further enhance the corporate value of both companies as a highly competitive dry bulk operator.

【Terms of the Tender Offer】

* Total Purchase Amount: Calculated by multiplying the Tender Offer Price (10,600 yen) by the Number of Shares to be Purchased (11,379,482 shares).
* Nippon Steel has agreed with NYK not to tender shares in the Tender Offer and to tender shares in the Tender Offer for Share Repurchase, respectively.

【Terms of the Tender Offer for Share Repurchase】

* Total Purchase Amount from Nippon Steel: Calculated by multiplying the Tender Offer Price for Share Repurchase (7,676 yen) by the Number of Shares to be Purchased from Nippon Steel (4,720,438 shares).
* Shareholders of NS United Kaiun, excluding Nippon Steel, are expected to tender their shares in the Tender Offer rather than the Tender Offer for Share Repurchase. In addition, even if certain shareholders of NS United Kaiun other than Nippon Steel were to tender their shares in the Tender Offer for Share Repurchase, the maximum number of shares to be purchased has been set at a number exceeding the number of shares to be purchased from Nippon Steel (5,898,713 shares) to ensure that NS United Kaiun can acquire all of the shares to be purchased from Nippon Steel.
* NS United Kaiun has stated that it plans to finance the funds required for settlement, etc. related to the Tender Offer for Share Repurchase using its own funds and borrowings from financial institutions or the Tender Offeror.

【Tentative Schedule】

* Due to the difficulty in accurately predicting the time required for the procedures, etc., before domestic and foreign competition authorities, the above is merely a current assumption, and the schedule for the Tender Offer will be announced promptly upon its determination.

On March 10, 2023, the NYK Group released its medium-term management plan “Sail Green, Drive Transformations 2026 — A Passion for Planetary Wellbeing.” The NYK Group is promoting growth strategies with Sustainability at the core, based on the Group’s mission statement of “Bringing value to life” and a new corporate vision for 2030, which reads, “we go beyond the scope of a comprehensive global logistics enterprise to co-create value required for the future by advancing our core business and growing new ones.”