KKR Acquires Over a Third of FUJI SOFT With Completion of First Stage of Tender Offer

Business Wire 7-Nov-2024 8:17 PM

• FUJI SOFT's advisors, directors, and officers tendered ~90% of their share options
• Result means any plan to privatize FUJI SOFT will require KKR's support

KKR, a leading global investment firm, today announced that in connection with its two-stage tender offer scheme (the "Tender Offer") for the common shares and share options of FUJI SOFT INCORPORATED (TSE stock code 9749; "FUJI SOFT") through FK Co., Ltd. (the "Offeror"), the Offeror, an entity owned by investment funds managed by KKR, completed the first of the two planned tender offers ("First Tender Offer") on November 5.

With the completion of the First Tender Offer, the Offeror will become the largest shareholder of FUJI SOFT, acquiring 21,413,302 common shares (voting rights ratio: 33.86%), and share options totaling 718,600 common shares on an as-converted basis (approximately 90% of the share options existing prior to the First Tender Offer). As the Offeror will acquire more than one-third of FUJI SOFT's voting rights, it is best positioned to work with FUJI SOFT to achieve its privatization, which the Board of Directors of FUJI SOFT have indicated to be the best measure to enhance its corporate value¹; further, it will no longer be possible for any other party to take the company private without the Offeror's support.

Notably, advisors (komon), directors and officers of FUJI SOFT tendered approximately 90% of their share options and supported the First Tender Offer.

Following the successful First Tender Offer, the Offeror plans to commence a second tender offer in mid-November to acquire all remaining shares and share options of FUJI SOFT. The purchase price for the second tender offer is planned to be unchanged from the First Tender Offer at 8,800 yen per share, reflecting a 110.3% premium over the simple average closing price of FUJI SOFT's stock for the 12 months prior to October 2, 2023.²

Hiro Hirano, Deputy Executive Chairman of KKR Asia Pacific and CEO of KKR Japan, said, "The success of our first tender offer is an important milestone for FUJI SOFT and its stakeholders as it provides considerable clarity of our ability to support the company's aim of privatizing to enhance its corporate value. We are grateful for FUJI SOFT's continued confidence in our capabilities and believe that a stable and cohesive shareholder structure is in the company's best interests. We look forward to sharing KKR's full suite of resources and network to help FUJI SOFT achieve its next stage of transformation."

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This press release should be read in conjunction with the release issued by the Offeror on November 6 titled "Notice Regarding the Results of Tender Offer for the Shares of FUJI SOFT INCORPORATED (Securities Code: 9749) by FK Co., Ltd.".

The purpose of this press release is to publicly announce the results of the First Tender Offer and it has not been prepared for the purpose of soliciting an offer to sell or purchase in the Tender Offer. When making an application to tender, please be sure to read the relevant Tender Offer Explanatory Statement for the Tender Offer and make your own decision as a shareholder or share option holder. This press release does not constitute, either in whole or in part, a solicitation of an offer to sell or purchase any securities, and the existence of this press release (or any part thereof) or its distribution shall not be construed as a basis for any agreement regarding the Tender Offer, nor shall it be relied upon in concluding an agreement regarding the Tender Offer.

The Tender Offer will be conducted in compliance with the procedures and information disclosure standards set forth in Japanese law, and those procedures and standards are not always the same as the procedures and information disclosure standards in the U.S. In particular, neither sections 13(e) or 14(d) of the U.S. Securities Exchange Act of 1934 (as amended; the same shall apply hereinafter) or the rules under these sections apply to the Tender Offer; and therefore the Tender Offer will not be conducted in accordance with those procedures and standards.

Unless otherwise specified, all procedures relating to the Tender Offer are to be conducted entirely in Japanese. All or a part of the documentation relating to the Tender Offer will be prepared in English; however, if there is any discrepancy between the English-language documents and the Japanese-language documents, the Japanese-language documents shall prevail.

This press release includes statements that fall under "forward-looking statements" as defined in section 27A of the U.S. Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934. Due to known or unknown risks, uncertainties or other factors, actual results may differ materially from the predictions indicated by the statements that are implicitly or explicitly forward-looking statements. Neither the Offeror nor any of its affiliates guarantee that the predictions indicated by the statements that are implicitly or expressly forward-looking statements will materialize. The forward-looking statements in this press release were prepared based on information held by the Offeror as of today, and the Offeror and its affiliates shall not be obliged to amend or revise such statements to reflect future events or circumstances, except as required by laws and regulations.

The Offeror, its financial advisors and the Tender Offer agent (and their respective affiliates) may purchase the common shares and share options of FUJI SOFT, by means other than the Tender Offer, or conduct an act aimed at such purchases, for their own account or for their client's accounts, in the scope of their ordinary business and to the extent permitted under financial instrument exchange-related laws and regulations, and any other applicable laws and regulations in Japan, in accordance with the requirements of Rule 14e-5(b) of the U.S. Securities Exchange Act of 1934. Such purchases may be conducted at the market price through market transactions or at a price determined by negotiations off-market. In the event that information regarding such purchases is disclosed in Japan, such information will also be disclosed on the English website of the person conducting such purchases (or by any other method of public disclosure).

About KKR

KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR's insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR's investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE:KKR), please visit KKR's website at www.kkr.com. For additional information about Global Atlantic Financial Group, please visit Global Atlantic Financial Group's website at www.globalatlantic.com.

____________________ ¹ In the "Notice regarding Expression of Opinion in Support of the Tender Offer for the Company Share Certificates by FK Co., Ltd. and Recommendation to Tender Shares", published by FUJI SOFT on September 4, 2024, it was stated that "…the Company concluded in the middle of July 2024 that the most crucial issue for advancing the Company's management is to restructure the shareholder composition. The Company concluded that the best means to achieve this is to accept the PE funds' [proposals for FUJI SOFT to be taken private]". To date, FUJI SOFT has not disclosed any change to this conclusion. ² Figures represent the unaffected FUJI SOFT share price based on the closing share price on October 2, 2023, the last full trading day immediately prior to the speculative publication of media reports regarding the start of the bidding process for a potential tender offer.

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