Notice Regarding Decision on Basic Policy and Commencement of Preparation for Absorption-type Merger with Morinaga Milk Industry Sales Co., Ltd., Our Wholly Owned Subsidiary

Overview of Corporate Reorganization

Morinaga Milk Industry Co., Ltd. has resolved the basic policy to absorb its wholly owned subsidiary Morinaga Milk Industry Sales Co., Ltd. and has started preparations. The merger method is expected to be a simplified and abbreviated absorption-type merger with our company as the surviving company and the target subsidiary as the dissolving company. The objective is to enhance corporate value by consolidating management resources, strengthening, streamlining, and accelerating sales activities, and reinforcing group governance. There will be no issuance of new shares or allocation of cash due to the merger.

Future Schedule and Impact

Approval of the merger agreement by the board of directors and the execution of the merger agreement are scheduled for March 2027, with the effective date of the merger expected in April 2027. The schedule may change depending on preparation status. No changes are planned to the company name, location, representatives, capital, or fiscal year after the merger. The impact of this reorganization on consolidated financial results is expected to be minimal; timely disclosure will be made upon finalization of specific details.