August 25, 2022
Company name: Osaki Electric Co., Ltd.
Representative: Chairman and CEO
Yoshihide Watanabe(Code: 6644, TSE Prime Market)
Contact: Director and Managing Executive Officer
Head of Corporate Strategy Division
Ryuichi Ueno
Notice of Transfer of Shares in a Consolidated Subsidiary, Recording Extraordinary Loss (Consolidated )and Extraordinary Income (Non-consolidated), and Revision of Financial Forecasts
Osaki Electric Co., Ltd. (Tokyo, hereinafter “Osaki” or “the Company”) announces that at the meeting of theBoard of Directors held on August 25, 2022, the Company resolved to transfer all of the shares of OsakiEngineering Co., Ltd. (hereinafter "Osaki Engineering"), a consolidated subsidiary of Osaki, to Hagiwara
Electric Holdings Co., Ltd. (hereinafter “Hagiwara”). Accordingly, Osaki Engineering will be out of theOsaki’s scope of consolidation, and Osaki plans to record consolidated extraordinary loss and nonconsolidated extraordinary income in the six months ending September 30, 2022. Osaki also revised theconsolidated financial forecasts for the fiscal year ending March 2023, which were previously announced onMay 12, 2022. Details are as follows.
1. Reason of the stock transfer
Osaki Engineering was established as a venture investment business in 1990 and has been developing
manufacturing equipment, such as sensor devices and high-performance device-related equipment, withfine-pitch bonding technologies as its core strengths.
Manufacturing equipment market is expanding due to a ramp up in manufacturing of semiconductors
and the electrification of vehicles. In order to expand this business in the future, it is important tostrengthen business operations and make ongoing investments. Amid the lack of synergies within theGroup, we recognized the technological and product capabilities that Osaki Engineering has accumulated,and decided to transfer the business to Hagiwara, which can make maximum use of these strengths, arebest for the sustainable growth of Osaki Engineering.
The cash generated from the share transfer will be effectively used to grow the smart meters & solutions
business, which is the Group's core business.
2. Outline of the subsidiary to be sold(1) Name

Osaki Engineering Co., Ltd.

(2) Address

326, Sayamagahara, Iruma-shi, Saitama, Japan(3)

Title and name ofrepresentative

President, Ken Yamauchi(4) BusinessSensor and high-function device related equipment, Energy-related
manufacturing equipment, Flat panel display module assemble related
equipment, and other manufacturing equipment(5) Capital

484 million yen1(6) Established(7)

Major shareholder and its
shareholding

Relationships between(8) Osaki and Osaki
Engineering

April 26, 1990
Osaki Electric Co., Ltd. 100%

Capital relationshipAs stated in (7) above, Osaki owns a 100% stake inOsaki Engineering.

Human resource
relationshipOne director and one corporate auditor of therelevant company are also our officers andemployees.

Businessrelationship

Osaki has borrowings from Osaki Engineering.
Osaki also guarantees for electronically recordedobligations.

(9) Consolidated operating results and financial position for the past three years
Year ended March 31,
2020

Year ended March 31,2021

Year ended March
31, 2022

Net assets

2,891 million yen

2,601 million yen

2,325 million yen

Total assets

3,204 million yen

2,827 million yen

2,814 million yen

559.69 yen

503.42 yen

450.02 yen

Net sales

1,335 million yen

960 million yen

692 million yen

Operating income(84) million yen(264) million yen(282) million yen

Ordinary income(79) million yen(256) million yen(273) million yen

Net income(83) million yen(290) million yen(275) million yen

Net income per share(16.12) yen(56.27) yen(53.40) yen

Dividend per share－－－Fiscal year end

Net assets per share

3.

Outline of the transferee
(1)

Name

Hagiwara Electric Holdings Co., Ltd.

(2)

Address

2-2-1 Higashi Sakura, Higashi-ku, Nagoya-shi, Aichi, Japan(3)

Title and name of representative

President and Representative Director, Moritaka Kimura(4)

Business

Formulating and managing business strategies for groupcompanies which sells electronic devices and electronicequipment, and manufactures and sells FA equipment(5)

Capital4,361 million yen (as of March 31, 2022)(6)

Established

December 20, 1958

(7)

Consolidated net assets

39,369 million yen (as of March 31, 2022)(8)

Consolidated total assets

82,482 million yen (as of March 31, 2022)

2Major shareholders and theirshareholding ratio(as of March 31, 2022)

(9)

(10)

Relationships between Osakiand Hagiwara

The Master Trust Bank of Japan, Ltd. (trust account) 10.79％
Custody Bank of Japan, Ltd. (trust account) 6.46％
STANY Co., Ltd. 5.60％
BBH FOR FIDELITY PURITAN TR: FIDELITY SR
INTRINSIC OPPORTUNITIES FUND 3.95％
Tomoaki Hagiwara 3.83％
MUFG Bank, Ltd. 2.63％
Nagoya Small and Medium Business Investment &Consultation Co., Ltd 2.60％
HAGIWARA FOUNDATION OF JAPAN 2.60％
Employees’ Stockholding 2.20％
Sumitomo Mitsui Trust Bank, Limited 2.01％
Capital relationship
Not applicable
Human resource
relationship

Not applicable

Business relationship

Not applicable

Related party or not

Hagiwara is not a related party ofOsaki. No persons concernedwith or affiliates of Hagiwara arerelated parties of Osaki.

4. Number of shares to be transferred, transfer price, and number of shares held before and after the transfer
Number of shares held
before the transfer

5,167,120 shares(Number of voting rights: 51,671)(Ratio of voting rights owned: 100%)(2)

Number of shares to be transferred

5,167,120 shares(Number of voting rights: 51,671)(Transfer price: 1.76 billion yen)(3)

Number of shares held
after the transfer0 share(Number of voting rights: 0)(Ratio of voting rights owned: 0%)

(1)

5.

Schedule(1)

Resolution of Board of Directors

August 25, 2022

(2)

Conclusion of agreement

August 25, 2022

(3)

Stock transfer

September 30, 2022 (planned)

6. Impact on Profit and Loss
Osaki plans to record extraordinary income and loss in the following amounts for the six months ending
September 30, 2022 (*).
Consolidated:

Loss on sales of shares of subsidiaries and affiliates
in the amount of 0.58 billion yen

Non-consolidated: Income on sales of shares of subsidiaries and affiliates
in the amount of 1.63 billion yen*Actual figures may differ from estimates due to future factors.
3

7.

Revision of Financial Forecasts
The consolidate financial forecasts for the six months ending September 30, 2022 and the full year
ending March 31, 2023, which were previously announced on May 12, 2022, have been revised asfollows, considering the impact of the above share transfer. The Company is currently assessing theongoing operations and business environment, and will make additional changes to its financial forecasts
as necessary and disclose the changes immediately.

Revision of consolidated financial results forecast for the six months ending September 30, 2022
(from April 1, 2022 to September 30, 2022)
Net Sales(Million yen)

Operating Income(Million yen)

Ordinary Income(Million yen)

Net Income
Attributable to
Owners of Parent(Million yen)

Net Income
Attributable to
Owners of Parentper Share(Yen)Previous Forecasts (A)39,000(200)

(150)

1,300

27.59

Revised Forecasts (B)39,000(200)

(150)

720

15.28

Change (B-A)―――(580)

Rate of Change (%)―――(44.6)

36,087461

531(236)(4.83)

Ordinary Income(Million yen)

Net Income
Attributable to
Owners of Parent(Million yen)

Net Income
Attributable to
Owners of Parentper Share(Yen)(Reference) Results forthe first half of fiscal year
2021

Revision of consolidated financial results forecast for the fiscal year 2022
(from April 1, 2022 to March 31, 2023)
Net Sales(Million yen)

Operating Income(Million yen)Previous Forecasts (A)80,000

1,000

1,100

1,500

31.96

Revised Forecasts (B)80,000

1,000

1,100

920

19.60

Change (B-A)―――(580)

Rate of Change (%)―――(38.7)

76,184

1,277

1,189(658)(Reference) Results of theprevious fiscal year ended
March 31, 2022

(13.42)

・The forecast figures shown in this document are based on information available at the time of preparation
and actual figures may differ from the forecast figures due to various factors.
End of notice4