Kanematsu : New Organization for Further Growth of Kanematsu Group －Growth Strategy Office to Launch－

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September 27, 2023

Kanematsu Corporation (hereinafter "Kanematsu") announces changes to its organizational structure and Executive Officers as described below.

1) Establishment of the Growth Strategy Office (effective October 1, 2023)

Kanematsu will newly establish the Growth Strategy Office for the purpose of strengthening the integrated management of the Kanematsu Group, promoting investments and M&As, and creating innovations.

- An organization under the direct control of the president, not placed under the business/support divisions

- Comprised of personnel with business experience in individual business divisions

- Responsible for creating cross-functional and Group-wide synergies and implementing growth strategies for the Group

2) Background and purpose of the establishment of the Growth Strategy Office

① Strengthening the integrated management of the Group
Following the acquisition of 100% ownership of Kanematsu Electronics Ltd. and Kanematsu Sustech Corporation, Kanematsu has established a management policy to make the Group more integrated. Kanematsu boasts a broad business foundation consisting of more than 130 Group companies and a large number of suppliers, as well as a wide range of management resources and intangible assets--including the abundant experience and expertise accumulated for more than 130 years since its foundation, technologies, human capital, networks, and value chains. The "integrated management of the Group," set out in Kanematsu's management policy, refers to full utilization of these management resources and intangible assets throughout the Group, thereby maximizing Group synergies. To further accelerate the integrated management of the Group, it is necessary to review the present corporate structure to ensure more effective business performance. To this end, we have decided to launch the Growth Strategy Office as a highly professional organization under the direct control of the president.

The Growth Strategy Office, which does not belong to the business or support division, will engage in cross-functional activities, beyond the boundaries of the Group companies and segments, to facilitate the integrated management of the Group. For the digital transformation (DX) and green transformation (GX), promoted by Kanematsu on a Group-wide basis, the new organization will serve as a facilitator of flexible and timely coordination to overcome challenges that affiliated companies and business divisions cannot on an individual basis.

② Promoting investments and M&As
Kanematsu has regarded investments and M&As for the "acquisition of added value" and the "expansion of scale" as one of its important strategies. In terms of post-merger integration (PMI)--a process that maximizes the effect of integration after an investment and a key factor that determines the success or failure of the investment and M&A--the goal of such investment is to maximize synergy effects in the Group as a whole, and create greater value than the sum of individual values.

In the investment projects that require the Group's accumulated knowledge and expertise--including the ongoing projects to make two affiliated companies become wholly owned subsidiaries and the investment project in Sierra Space--as well as investment projects that are expected to generate synergies in multiple business divisions and affiliated companies, the Growth Strategy Office will take a leading role to maximize synergy effects withing the Group.
As an organization under the direct control of the president, the Growth Strategy Office will develop and implement investment projects and carry out PMI from the perspective of overall optimization in line with the management strategy. It will also tackle the challenge, from a broader view, of large investment projects that would be difficult to be implemented by business divisions and affiliated companies on an individual basis, as well as investments in conglomerate companies and M&As, by developing strategies, making decisions, and sharing management resources from the perspective of the integrated management of the Group. In addition, the Growth Strategy Office will be composed of personnel with diverse business experience from various business divisions. The members, including those with a deep understanding of front-line jobs, will develop and implement investment projects that can enhance, expand, and complement the strengths of individual business divisions and affiliated companies.
For the purpose of establishing a professional investment and M&A promotion system, we will set up the Investment Strategy Team within the Growth Strategy Office, main roles of which are to promote and implement investments and M&As and manage the progress of PMI. The Investment Strategy Team, which inherits the personnel and vision of the former Business Development & Investment Innovation Office, Corporate Planning Dept., will play a role as a professional team dedicated to investment.

③ Creating innovations
Kanematsu has set the "creation of a new business portfolio through innovation investment" as one of the strategies of the Medium-Term Visions. It is the mission of Kanematsu to generate new businesses and achieve business growth for the medium and long term by adopting new technologies, systems, and business models, while pursuing innovations to create new value toward a future society.
Cooperation and collaboration with startups in a swift manner is a key to success in creating innovations, amid fierce competition with rivals. In an ever-changing business environment, the Growth Strategy Office will accelerate the commercialization of innovations by promoting rapid decision-making, carrying out the will of the top management quickly, and taking advantage of the company's high level of competitiveness and adaptability.
To create innovations, it is critical to think beyond common sense now, free from conventional methods, by sharing and combining diverse points of view, insights, and wisdom. The Growth Strategy Office--comprised of excellent personnel, from various business divisions, with different business backgrounds and a wide variety of experience--will work on the creation of a new business with a new way of thinking, free from and beyond the conventional business framework.

In 2019, we established Kanematsu Ventures Inc.* in Silicon Valley in the United States and built a network with startups, engaged in research and development of advanced technologies and business models. Without this entity, access to those startups would not have been available. Under the leadership of the Growth Strategy Office, we will facilitate the activities of Kanematsu Ventures Inc., share and use the company's strengths within the Group as a whole, and thereby create innovations everywhere in the Group going forward.

Under the Growth Strategy Office, the Business Development Team will also be formed, whose mission is to generate business synergies and develop/support collaboration and cooperation within the Group. Based on the vision of the former Technologies and Business Collaboration Team, the Business Development Team will function as a professional team dedicated to business creation.

* Press release regarding the establishment of Kanematsu Ventures Inc.:
https://www.kanematsu.co.jp/en/press/20190208_001783.html

3) Abolition and integration of the Business Development & Investment Innovation Office, Corporate Planning Dept. and the Technologies and Business Collaboration Team
As a result of the establishment of the Growth Strategy Office, the Business Development & Investment Innovation Office, Corporate Planning Dept. and the Technologies and Business Collaboration Team will be abolished and integrated with the Growth Strategy Office.

4) Organization (as of October 1, 2023)

5) Name of the New Organization

6) Changes to Executive Officers (as of October 1, 2023)

[Contacts]

Public & Investor Relations Section, Kanematsu Corporation
Tel: +81-3-6747-5000
https://www.kanematsu.co.jp/en/inquiry/