Oji : Notice Regarding the Change in Equity Method Affiliated Company (Share Transfer) and the Occurrence of Extraordinary Loss
March 27, 2015 at 02:22 am EDT
Share
Notice Regarding the Change in Equity Method Affiliated Company (Share Transfer) and the Occurrence of Extraordinary Loss
Oji Holdings Corporation (hereinafter the "Company") would like to announce that its Board of Directors has resolved on March 27, 2015 to approve the transfer of all the shares the Company has of Alpac Forest Products Inc. (hereinafter "AFPI"), which amounts to 30% of AFPI's outstanding shares, to Hokuetsu Kishu Paper Co., Ltd.
The Company would also like to inform that as a consequence of this transfer, an extraordinary loss is expected to occur in the consolidated financial results for the fiscal year ending March 2015.
1. Reason for the Share Transfer
The Company has been driving forward "Deepening of the Core Businesses" as a priority measure of its management strategy. For the kraft pulp business, which is one of the core businesses, the Company has focused its investments in Celulose Nipo-Brasileira S.A.(Brazil), Jiangsu Oji Paper(China) and Carter Holt Harvey Pulp & Paper Limited (New Zealand), and will continue to develop the business with a main focus around these companies in the future.Taking into consideration the said business policy as well as a perspective of efficient use of management resources associated with selection and concentration of business activities, the Company, jointly with Mitsubishi Corporation, has reached to the conclusion that the share transfer of AFPI is the best decision.
2. Content of the Share Transfer
(1) Overview of the Equity Method Affiliated Company Subject to the Share Transfer
(2) The Purchaser and the Shareholding of the Company before and after the Share Transfer
Name
Hokuetsu Kishu Paper Co., Ltd.
Number of shares owned before the share transfer
5,700,000 (ownership percentage: 30%)
Number of shares transferred
5,700,000
Number of shares owned after the share transfer
0 (ownership percentage: 0%)
3. Schedule
Resolution by the Board of Directors
March 27, 2015 (today)
Execution of the agreements
March 31, 2015
Execution of the share transfer
mid-June (planned)
4. Future Outlook
In order to prepare for the expected loss resulting from the share transfer, the Company will post an extraordinary loss of approximately 12 billion on its consolidated financial statements for the fiscal year ending March 2015. In addition, the impact on the financial result forecast, together with consideration of recent business conditions, is currently under examination. If the need to revise the forecast arises, the Company will promptly disclose such information.
(Reference) Financial Result Forecasts (released date: February 6, 2015) and Results of the Previous Period
Oji Holdings Corporation specializes in production and marketing of papers. Net sales break down by activity as follows:
- household and industrial products (40.2%): corrugated cardboard, cardboard packaging, packaging papers, sanitary papers, disposable diapers, paper bags, etc.;
- graphic papers (14%): newsprint, printing and writing paper, fine paper, carbonless paper, etc.;
- lumber and pulp (18.1%). The group is also engaged in electricity generation activity;
- functional paper (10.6%): speciality paper, thermal paper, self-adhesive paper, film paper, etc.;
- other (17.1%).
Japan accounts for 66.5% of net sales.