Notice Regarding the Transfer of Condominium Business through Company Split (Absorption-type Split) of Our Subsidiaries

Overview of Company Split

Yahagi Construction Industry Co., Ltd. has resolved to transfer the condominium development and sales business of its subsidiary Yahagi Jisho Co., Ltd. and the condominium management business of Yahagi Building & Life Co., Ltd. to Meitetsu Urban Development Co., Ltd. and Meitetsu Community Life Co., Ltd. via absorption-type company split. This transfer is part of the group’s business selection and concentration strategy, aiming to focus management resources on construction projects for corporations and government agencies. The effective date of the transfer is planned for April 1, 2026.

Impact on Performance and Measures to Ensure Fairness

As a result of this company split, a special loss of approximately 1.8 billion yen is expected to be recorded in the third quarter of the fiscal year ending March 2026. Conversely, a special gain of approximately 1 billion yen is anticipated in the first quarter of the fiscal year ending March 2027 due to the transfer of Yahagi Building & Life’s successor business. Since this transaction is between related parties, measures to ensure fairness have been taken, including advice from an independent law firm, business valuation by a third-party appraiser, obtaining opinions from outside directors and auditors, and approval by all directors without conflicts of interest.