Merger of two consolidated subsidiaries
SOFTBANK CORP. announces that the board of directors meeting of SOFTBANK TELECOM SALES Corp. (Head office: Minato-ku, Tokyo; Representative: Ken Miyauchi; hereinafter “SBTS”) and SOFTBANK TELECOM Corp. (Head office: Minato-ku, Tokyo; Representative: Masayoshi Son; hereinafter “SBTM”) resolved today a merger as follows;
1. Purpose of merger
To accelerate business development of SBTM within the SOFTBANK Group and strengthen its financial structure by merging with SBTS based on the Group’s management policy which is to strengthen the operational base
2. Outline of merger
(1) Merger schedule
| December 15, 2006 | Board of directors meeting to approve merger agreement in both parties |
|---|---|
| January 19, 2007 | Extraordinary General Meeting to approve merger agreement (planned) |
| February 1, 2007 | Effective date of merger (planned) |
(2) Method of merger
SBTS as an ongoing concern shall absorb SBTM, which shall be subsequently dissolved. SBTS is scheduled to change its corporate name to SOFTBANK TELECOM Corp. after the merger.
(3) Share to be issued upon merger
SBTS will issue 1,960,300 common shares upon merger in exchange for the shares of SBTM 169,455,424 common shares and SBTS 1,076,200 common shares, and SBTM 139,200,000 preferred shares and SBTS 884,100 common shares respectively, for the shareholders who were registered or recorded on the SBTM’s latest shareholders’ list as of the previous day of effective date of merger.
(4) Capital and reserve to be increased for the merger
No increase or decrease of SBTS capital and its reserve occurs due to the merger.
3.Outline of companies concerned (as of December 1, 2006)
| Surviving company | Company which shall be absorbed | |||||
|---|---|---|---|---|---|---|
| Corporate name | SOFTBANK TELECOM SALES Corp. | SOFTBANK TELECOM Corp. | ||||
| Type of business | Fixed-line business, investment business | Fixed-line business | ||||
| Date of incorporation | March, 1999 | August, 2002 | ||||
| Location of head office | 1-9-1 Higashi-Shimbashi, Minato-ku, Tokyo | 1-9-1 Higashi-Shimbashi, Minato-ku, Tokyo | ||||
| Representative | Ken Miyauchi | Masayoshi Son | ||||
| Common stock | 100 million yen | 145,800 million yen | ||||
| Shares outstanding | Common shares 826,300 |
Common shares 169,455,424
Preferred shares 139,200,000 | ||||
| Net assets *1 | 8,424 million yen | 123,148 million yen | ||||
| Total assets *1 | 11,380 million yen | 473,030 million yen | ||||
| Settlement of accounts | March 31 | March 31 | ||||
| Principal shareholders and ownership ratios | SOFTBANK CORP. 100% | SOFTBANK CORP. 100% | ||||
|
Business result for the recent 3 fiscal years ended March 31
*2
(Unit: million yen) | FY 2004 | FY 2005 | FY 2006 | FY 2004 | FY 2005 | FY 2006 |
| Net sales | 410 | 541 | 172 | 172,117 | 335,804 | 353,717 |
| Operating income (loss) | (1,489) | (1,348) | (497) | (1,561) | (52,110) | (20,988) |
| Ordinary income (loss) | (2,413) | 6,200 | 1,013 | (1,449) | (54,887) | (36,014) |
| Net income (loss) | 14,589 | 3,739 | 20,438 | (49,959) | (81,634) | (87,636) |
| Net income per share (yen) | 17,656 | 4,525 | 24,735 | (51,002) | (480) | (330) |
- *1 As of March 31, 2006
- *2 Figures of SOFTANK TELECOM Corp. is under consolidated base. Since closing term change was made for the period ended March 2004, figures are for 6 months from October 1, 2003 to March 31, 2004.
4. Post-merger information
| (1) Corporate name | SOFTBANK TELECOM Corp. |
|---|---|
| (2) Type of business | Fixed-line business |
| (3) Location of head office | 1-9-1 Higashi-Shimbashi, Minato-ku, Tokyo |
| (4) Representative | Masayoshi Son |
| (5) Common stock | 100 million yen |
| (6) Settlement of accounts | March 31 |
5. Impacts on financial results
Impacts due to this merger are under study as of today and will be communicated as soon as when confirmed.
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