Notice Regarding Establishment of a Wholly Owned Subsidiary through Absorption-Type Company Split Concerning Domestic Sales Business of Cement and Solidifying Agents and Transfer of Shares of Certain Consolidated Subsidiaries, and Transfer of Shares of the Wholly Owned Subsidiary (Change in Subsidiary)

Overview of Company Split and Share Transfer

Tokuyama Corporation has resolved to transfer the domestic sales business of cement and solidifying agents, along with all shares of consolidated subsidiaries Tokuyama Corporation Ltd. and Tokuyama M-Tech Co., Ltd., to a newly established wholly owned subsidiary through an absorption-type company split. The shares of this new company will then be transferred to Taiheiyo Cement Corporation for 37,000 million yen. The execution date for the transfer is scheduled for October 1, 2026. The new company is planned to be established on July 1, 2026, with the transaction conducted via a simplified absorption-type company split.

Business Background and Future Outlook

In response to declining domestic cement demand, Tokuyama is proceeding with scaling down its cement manufacturing framework and plans to begin reviewing cessation of cement and solidifying agent production by fiscal year 2028. This transaction will accelerate structural reform at the Tokuyama manufacturing site, which includes the Nanyo plant, and strengthen resource allocation toward growth businesses in the "Electronics," "Health," and "Environment" sectors. Additionally, the company plans to gradually reduce overseas cement sales and is also considering waste disposal and equipment utilization measures.