At the Board of Directors Meeting held on July 14, 2014, PROTO CORPORATION (the Company) made the decision to acquire shares in TIRE WORLD KAN BEST CO., LTD. (hereinafter referred to as TIRE WORLD KAN BEST) and make it a subsidiary company. The details are as below.
1.Reason for Acquisition of Shares
The Company provides a variety of information services in order to benefit consumers, centered on "Goo-net", the car portal site with the largest number of registered used cars in Japan. In addition to further enhancing products and services such as Goo-inspection, the Company is working towards expanding its business areas in order to grow its Automobile-related Information Business, which is the Company's primary business.
As part of this plan, the Company made the decision to purchase shares of TIRE WORLD KAN BEST from YAMAUCHI CO., LTD. (hereinafter referred to as YAMAUCHI) and make it into a subsidiary. YAMAUCHI and its subsidiaries, TIRE WORLD KAN BEST and YS CORPORATION CO., LTD.(hereinafter referred to as YS CORPORATION), mainly sell automobile tires at stores in Tohoku region, and have the strength in stocking of tires made in Japan. The Company plans to not only provide services to consumers, but also to increase sales of tires to clients such as used car dealers and car maintenance shops. Additionally, through synergy with the Company's media including car portal site "Goo-net", the business of TIRE WORLD KAN BEST will be expanded.
By October 1, 2014, the Company plans to merge TIRE WORLD KAN BEST with YS CORPORATION, with TIRE WORLD KAN BEST as the surviving company.
As for the assets related tire sales held by YAMAUCHI, they will be transferred to TIRE WORLD KAN BEST before the Company acquires its shares.
2.Transfer Method
The Company will purchase shares of TIRE WORLD KAN BEST from YAMAUCHI, which will hold all shares of TIRE WORLD KAN BEST as of April 1, 2015.
3.Overview of Acquired Subsidiary
An absorption-type merger of TIRE WORLD KAN BEST with YS CORPORATION, with TIRE WORLD KAN BEST as the surviving company, is planned by October 1, 2014. The information below is an overview of TIRE WORLD KAN BEST before the merger.
※Of the TIRE WORLD KAN BEST shares held by Kazuo Ojima and Shigeru Onuma will be acquired by YAMAUCHI before the merger with YS CORPORATION.
※As of July 1, 2013, YS CORPORATION’s issued shares increased from 10,000 to 30,000, but Net assets per share and Net income for the period per share are calculated assuming this change occurred on the first day of the fiscal year ending March 31, 2014.
4.Overview of Stock Acquisition Partner
※Assets related to tire sales held by YAMAUCHI are planned to be transferred to TIRE WORLD KAN BEST before the Company acquires its shares.
※For the fiscal year ending September 30, 2013, YAMAUCHI had sales of 5,219 million yen, operating income of 303 million yen, ordinary income of 309 million yen and net income of 227 million yen.
5.Number of shares acquired, value of acquisition, and status of stock ownership before and after acquisition
※Acquisition Cost and Basis for Calculation
In order to ensure the equitability and appropriateness of the acquisition cost, it is calculated based on an appraised value by an independent third party, with consideration giving for business synergy with the Group.
6.Time Schedule
Corporate resolution: July 14, 2014
Contract signed for purchasing shares: July 14, 2014
Transfer date: April 1, 2015 (scheduled)
7.Financial Outlook
This will have no effect on the consolidated results of the fiscal year ending March 31, 2015, but is expected to contribute to consolidated results for the fiscal year ending March 31, 2016 and on.
