Company name:
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JX Holdings, Inc.
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Representative:
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Yukio Uchida
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Representative Director, President
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Stock code:
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5020; first section of Tokyo Stock Exchange
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and Nagoya Stock Exchange
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Contact:
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Investor Relations Group
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Finance & Investor Relations Department
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Phone number:
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+81-3-6275-5009
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Company name:
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TonenGeneral Sekiyu K.K.
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Representative:
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Jun Mutoh
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Representative Director, President
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Stock code:
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5012; first section of Tokyo Stock Exchange
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Contact:
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Public and Government Relations
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EMG Marketing G.K.
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Phone number:
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+81-3-6713-4400
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(1)
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Using best efforts to pursue the business integration in a fair and equitable spirit and in the spirit of equal partnership as well as in good faith.
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(2)
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Engaging in discussions with zero-base thinking irrespective of the past business management approach or organization, etc. of the two groups.
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(3)
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Concentrating the strengths of the two groups such as their ability to conduct general business operations, their wide variety of portfolios, their new businesses with future potential and their efficient business management and refinery operations.
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(4)
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Realizing a business integration that will be supported by all in order to continue to be an enterprise which values continuous good relationships with customers and business partners that have been cultivated over many years and which continues to be selected as an indispensable enterprise.
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(1)
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JXHD and TonenGeneral will discuss and determine the following basic policies for the business operations of the Newco Group prior to the execution of the Business Integration Agreement:
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a)
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Basic policies for the role and the organization of the holding company and for business management for each company in the Newco Group.
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b)
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Basic policies for the role, organization and business management system of the company engaging in the Integrated Energy Business (the “Integrated Energy Business Company”), and for the establishment of a supply chain based on the principle of overall optimization.
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c)
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Basic policies for the reorganization and consolidation of the domestic and overseas offices, subsidiaries and affiliates of the two groups.
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(2)
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JXHD and TonenGeneral will incorporate the following aspects into those basic policies for business operations, with the details of such policies to be discussed and determined:
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a)
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Introducing into the holding company and the Integrated Energy Business Company a systematized business management method and system consolidating the strengths of the two groups, which has strictly structured control processes, and developing an organization to operate the business management system properly.
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b)
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Aiming to apply the business management system in (2)(a) to subsidiaries of the holding company one by one consistent with the progress of its introduction into the holding company and the Integrated Energy Business Company.
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c)
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Strengthening the strategic functions of the corporate planning department of the holding company in order to allow for optimal decision-making in the interest of the entire Newco Group with respect to the distribution of business resources, including decisions regarding the commencement, continuation or cessation of investments and businesses in the interest of the entire Newco Group.
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d)
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Aiming for the overall optimization in each of the functions of refining and manufacturing, supply and distribution and sales, which constitute the supply chain of the Integrated Energy Business Company, and establishing a cross-functional organization under which the supply and distribution function will fulfill a coordinating role in achieving overall optimization.
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e)
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Integrating and reorganizing the organization of the business service departments (such as planning, accounting, finance, investor relations, human resources, general affairs, public relations, corporate social responsibility, information systems, legal, procurement, audit and internal controls, etc.) of each company in the Newco Group into the holding company or a shared function company engaging in administrative services in order to conduct business management efficiently throughout the entire Newco Group and to enhance their expertise.
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(1)
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Disposition and integration of refineries and terminals, among others
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(2)
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Integrated operation of production facilities in the Kawasaki area
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(3)
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Streamlining of the organization through integration and elimination of redundancies
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(4)
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Optimization of refining and manufacturing, supply and distribution and sales
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(1)
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JXHD and TonenGeneral will discuss the new corporate names suitable for use by the holding company and the Integrated Energy Business Company.
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(2)
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The headquarters of the holding company and the Integrated Energy Business Company after the business integration will be 1-1-2, Otemachi, Chiyoda-ku, Tokyo.
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(3)
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The fiscal year of the holding company and the Integrated Energy Business Company after the business integration will be from April 1 through March 31 of the following year.
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December 3, 2015 (today)
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Execution of the MOU
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August, 2016 (plan)
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Determination of the integration ratio, and execution of the Business Integration Agreement
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December, 2016 (plan)
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Shareholders’ meetings to approve the business integration
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April, 2017 (plan)
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Effective date of the business integration
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(1)
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Company Name
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JX Holdings, Inc.
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TonenGeneral Sekiyu K.K.
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(2)
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Head Office
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2-6-3 Otemachi, Chiyoda-ku, Tokyo
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1-8-15 Konan, Minato-ku, Tokyo
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(3)
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Name and title of Representative
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Yukio Uchida
Representative Director, President
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Jun Mutoh
Representative Director, President
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(4)
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Main Business
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Managing and controlling subsidiaries and affiliates, engaging in oil and energy business, oil and gas exploration business and metal business
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Manufacturing, processing and sales of petroleum and petrochemical products, and supply of electricity
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(5)
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Paid-in capital
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100 billion yen
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35.1 billion yen
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(6)
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Date established
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April 1, 2010
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July 26, 1947
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(7)
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Number of issued shares
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2,495,485,929 shares
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565,182,000 shares
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(8)
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Net assets
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2,334 billion yen (consolidated)
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242 billion yen (consolidated)
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(9)
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Total assets
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7,182 billion yen (consolidated)
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1,183 billion yen (consolidated)
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(10)
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Fiscal year-end
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March 31
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December 31
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(11)
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Number of employees
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26,415 (consolidated)
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3,450 (consolidated)
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(12)
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Main banks
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Mizuho Bank, Ltd.
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
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Sumitomo Mitsui Banking Corporation
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Sumitomo Mitsui Trust Bank, Ltd.
Mitsubishi UFJ Trust and Banking Corporation
Mizuho Bank, Ltd.
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(13)
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Major shareholders and ownership
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Japan Trustee Services Bank, Ltd. (trust account)
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5.01%
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Mitsui & Co., Ltd.
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6.37%
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The Master Trust Bank of Japan, Ltd. (trust account)
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4.64%
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Mobil Oil Exploration and Producing Southeast Inc.
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5.45%
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Mizuho Bank, Ltd.
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3.05%
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Japan Trustee Services Bank, Ltd. (trust account)
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2.59%
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Sumitomo Mitsui Banking Corporation
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2.62%
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The Master Trust Bank of Japan, Ltd. (trust account)
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2.45%
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Mitsubishi Corporation
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1.95%
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Kochi Shinkin Bank
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1.51%
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(14)
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Relationship between the companies
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Capital ties
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Not applicable
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Personnel ties
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Not applicable
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Trade ties
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Not applicable
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Status of related parties
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Not applicable
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(Note 1)
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The data above in “(11) Number of employee” for JXHD and “(13) Major shareholders and ownership” for TonenGeneral are as of March 31, 2015 and June 30, 2015, respectively.
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(Note 2)
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TonenGeneral has treasury stock of 200,902,000 shares as of June 30, 2015. It is not on the list of major shareholders and ownership above.
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(Note 3)
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According to a copy of the ownership change report, which was submitted to the authorities on October 22, 2015, by Mobil Oil Exploration and Producing Southeast Inc., its ownership of TonenGeneral decreased to 4.40% (24,867,000 shares of TonenGeneral Sekiyu K.K., owned by the company) as of October 16, 2015, the date on which the company was obligated to report the ownership.
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Operating and financial results for the past three years | (Unit: millions of yen) |
JX Holdings, Inc.
(consolidated)
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TonenGeneral Sekiyu K.K.
(consolidated)
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Fiscal year
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Ending
03/2013
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Ending
03/2014
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Ending
03/2015
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Ending
12/2012
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Ending
12/2013
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Ending
12/2014
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Consolidated net assets
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2,327,432
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2,626,294
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2,429,849
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288,384
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294,640
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262,753
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Consolidated total assets
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7,274,891
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7,781,775
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7,423,404
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1,385,014
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1,409,081
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1,376,212
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Consolidated net assets per share (yen)
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781.30
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858.66
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778.93
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788.81
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805.77
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718.35
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Consolidated Sales
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11,219,474
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12,412,013
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10,882,460
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2,804,929
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3,241,150
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3,451,097
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Consolidated operating income (loss)
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251,467
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213,657
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(218,885)
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22,520
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52,289
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(72,948)
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Ordinary income (loss)
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328,300
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302,329
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(150,114)
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22,529
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49,816
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(73,383)
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Net income (loss)
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159,477
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107,042
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(277,212)
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54,770
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22,902
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(13,975)
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Net income (loss) per share (yen)
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64.13
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43.05
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(111.49)
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122.38
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62.84
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(38.36)
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Dividends per share (yen)
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16.00
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16.00
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16.00
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38.00
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38.00
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38.00
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Attachment
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Company Name
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JX Holdings, Inc.
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TonenGeneral Sekiyu K.K.
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(KBD)
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(KBD)
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||||||||
Sendai Refinery
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145
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Kawasaki Refinery
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258
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Kashima Refinery (Kashima Oil., Ltd.)
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253
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Chiba Refinery
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152
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Group Refineries
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Negishi Refinery
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270
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Sakai Refinery
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156
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Oil |
Topper Capacity
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Osaka Refinery (Osaka International Refining Company Ltd.)
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115
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Wakayama Refinery
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132
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Products |
(As of March 31, 2015)
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Mizushima Refinery
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380
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Marifu Refinery
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127
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Oita Refinery
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136
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Total
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1,426
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Total
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698
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# of Terminals
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48 (As of Oct 1, 2015)
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9 (As of Oct 1, 2015)
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Domestic Fuel Sales Vol.
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53 Million KL (Fiscal year ending 03/2015)
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26 Million KL (Fiscal year ending 12/2014)
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# of Dealers
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622 (As of March 31, 2015)
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710 (As of Mar 31, 2015)
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# of SS
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10,655 (As of Sept 30, 2015)
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3,520 (As of Dec 31, 2014)
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Product Export Volume
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9.1 Million KL (Fiscal year ending 03/2015)
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6.4 Million KL (Fiscal year ending 12/2014)
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Paraxylene
Production Capacity
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3,120 Kton/Yr (As of Sept 30, 2015)
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500 Kton/Yr (As of June 30, 2015)
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Chemicals
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Benzene
Production Capacity
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1,940 Kton/Yr (As of Sept 30, 2015)
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390 Kton/Yr (As of June 30, 2015)
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Ethylene
Production Capacity
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440 Kton/Yr (As of Sept 30, 2015)
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540 Kton/Yr (As of June 30, 2015)
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Propylene
Production Capacity
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990 Kton/Yr (As of Sept 30, 2015)
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750 Kton/Yr (As of June 30, 2015)
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Upstream
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Production Volume
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115 KBD (2014 Average)
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Reserve
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846 Million BOE (As of Dec 31, 2014)
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(Kton/Yr)
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JX Nippon Mining & Metals Corporation
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Ownership
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Production
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Escondida Copper Mine (in Chile)
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3.0%
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35
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Collahuasi Copper Mine (in Chile)
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3.6%
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17
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Upstream
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Los Perambles Copper Mine (in Chile)
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15.0%
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61
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Pan Pacific Copper Co, Ltd.
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Caserones Copper Mine (in Chile)
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77.4%
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36
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Production Volume (Copper)
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149
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(Kton/Yr)
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Pan Pacific Copper Co, Ltd.
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Saganoseki Smelter and Hitachi Refinery
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450
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Midstream |
Tamano Refinery (Note)
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200
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(Copper Refining)
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LS-Nikko Copper Inc.
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Onsan Plant
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680
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||||||||
Refining Capacity
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1,330
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(Note) Offtake of Pan Pacific Copper
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Electric Materials
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Isohara Works (For semi-conductor and FPD target etc)
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Downstream
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Kurami Works (Corson Alloy etc)
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Recycling and Environmental Services
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|||||||||
Hitachi Works
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|||||||||
This communication includes “forward-looking statements” that reflect the plans and expectations of JX Holdings, Inc. and TonenGeneral Sekiyu K.K. in relation to, and the benefits resulting from, their business integration described above. To the extent that statements in this document do not relate to historical or current facts, they constitute forward-looking statements. These forward-looking statements are based on the current assumptions and beliefs of the companies in light of the information currently available to them, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the actual results, performance, achievements or financial position of one or both of the companies (or the Newco Group) to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. The companies undertake no obligation to publicly update any forward-looking statements after the date of this communication. Investors are advised to consult any further disclosures by the companies (or the Newco Group) in their subsequent domestic filings in Japan and filings with the U.S. Securities and Exchange Commission. The risks, uncertainties and other factors referred to above include, but are not limited to:
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(1)
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economic and business conditions in and outside Japan;
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(2)
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changes in the market value of natural resources such as crude oil and exchange rates;
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(3)
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changes in interest rates on loans, bonds and other indebtedness of the companies, as well as changes in financial markets;
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(4)
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changes in the value of assets (including pension assets) such as securities;
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(5)
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changes in laws and regulations (including environmental regulations) relating to the companies’ business activities;
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(6)
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increases in tariffs, imposition of import controls and other developments in the companies’ main overseas markets;
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(7)
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interruptions in or restrictions on business activities due to natural disasters, accidents and other causes;
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(8)
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the companies being unable to complete the business integration due to reasons such as the companies are not able to execute a definitive agreement with regard to the business integration, the necessary procedures including approval of the agreement with regard to the business integration by the shareholders’ meetings of the companies are not implemented, and any other reasons;
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(9)
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delays in the review process by the relevant competition law authorities or the clearance of the relevant competition law authorities’ or other necessary approvals’ being unable to be obtained; and
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(10)
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inability or difficulty of realizing synergies or added value by the business integration by the Newco Group.
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JX Holdings, Inc. may file a registration statement on Form F-4 (“Form F-4”) with the U.S. Securities and Exchange Commission (the “SEC”) in connection with the possible business combination (or integration) between the two companies, if it is consummated. The Form F-4 (if filed) will contain a prospectus and other documents. If a Form F-4 is filed and declared effective, the prospectus contained in the Form F-4 will be mailed to U.S. shareholders of TonenGeneral Sekiyu K.K. prior to the shareholders’ meeting at which such business combination (or integration) will be voted upon. The Form F-4 and prospectus (if a Form F-4 is filed) will contain important information about the two companies, such business combination (or integration) and related matters. U.S. shareholders to whom the prospectus is distributed are urged to read the Form F-4, the prospectus and other documents that may be filed with the SEC in connection with such business combination (or integration) carefully before they make any decision at the shareholders’ meeting with respect to such business combination (or integration). Any documents filed with the SEC in connection with such business combination (or integration) will be made available when filed, free of charge, on the SEC’s web site at www.sec.gov. In addition, upon request, the documents can be distributed for free of charge. To make a request, please refer to the contact below.
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JX Holdings, Inc.
6-3 Otemachi, 2-chome, Chiyoda-ku, Tokyo, 100-8161, Japan
Tatsuya Higurashi, Group Manager, Finance & Investor Relations Department
TEL +81-3-6275-5009 e-mail: ir-news@hd.jx-group.co.jp
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