July 21, 2020
(Translated from the Japanese original)
Company Name:
Representative:
Stock Listing:Stock Code:Contact:
Phone:TIS Inc.
Toru Kuwano, Chairman, President andRepresentative Director
First Section of the Tokyo Stock Exchange
3626
Masakazu Kawamura, Department Managerof Corporate Management Dept.
+81-3-5337-4569 (in Japan, 03-5337-4569)

Notice regarding Commencement of Tender Offer for
Shares of Thailand’s MFEC Public Company Limited
As announced in the press release “Notice regarding Acquisition of Stock to Turn Thailand’s
MFEC Public Company Limited into TIS Subsidiary” dated March 6, 2020, management atTIS Inc. (hereafter, “TIS” and “the Company”) indicated plans for the Company to acquire
shares in MFEC Public Company Limited (hereafter, “MFEC”) through a tender offer(hereafter, “the Tender Offer”), in accordance with the securities exchange law and local lawsof Thailand. MFEC is currently a TIS affiliate accounted for by the equity method.
At this time, all conditions required to proceed with the Tender Offer have been met,including approval by shareholders at MFEC’s ordinary general meeting of shareholders andapproval by the Thai Securities and Exchange Commission. Details are provided below.
Note that the Tender Offer does not fall under tender offers described in Article 27
Paragraph 2-1 of Japan’s Financial Instruments and Exchange Law.
Details1.

Reason for Acquisition of Stock and Tender Offer
The TIS INTEC Group seeks to realize sustained corporate growth and higher
corporate value, guided by the slogan “Transformation to 2020 — Achieving
structural transformation as a corporate family and taking the lead in finding solutions
to social issues” that underpins Medium-Term Management Plan (2018-2020).
Various measures are being pursued toward this destination. As part of this journey,
TIS is pursuing an overseas business strategy aimed at becoming a top-class IT groupin the ASEAN region and is driving robust expansion of business domains throughcapital and business alliances and other forms of cooperation with leading companies
from the perspective of channels—that is, office networks and client bases—andtechnology in select business domains, namely, payment settlement, banking andenterprise resource planning.
MFEC, listed on the Thai stock exchange, is a leading provider of IT solutions
to enterprises in Thailand. To TIS management, MFEC earned top marks for its highprofile in Thailand, the service quality inherent in the solutions it provides to its
clients, and its extensive, well-balanced client base. This solid reputation in the market
led TIS to sign a capital and business alliance agreement with MFEC in April 2014. In
the time since then, the two companies have deepened their understanding of each1

other, which has underpinned TIS’ efforts to strengthen their relationship through thecreation of joint schemes across a wide range of pursuits as well as additional
investment.
At this time, turning MFEC into a consolidated subsidiary, accelerating businessrestructuring at MFEC, and expanding the scale of the TIS INTEC Group’s overseas
operations hold major significance in forming a top-class IT group in the ASEAN
region. Management sees the Tender Offer approach contributing to enhanced
corporate value of the TIS INTEC Group and thus decided to acquire additional sharesin MFEC and turn it into a consolidated subsidiary.
2.

Overview of the Tender Offer
(1)
(2)
(3)
(4)
(5)

(6)
(7)

Tender offeror
Target company
Tender offer periodClass of shares fortender offer
Tender offer price

Capital required fortender offer
Number of shares tobe purchased

TIS Inc.
MFEC Public Company Limited
From July 23, 2020 to September 28, 2020 (Planned)
Common stock
5.0 Thai baht (¥17.45) per share of common stock
Note: The tender offer price will be based on the company’s stock
price level and take various factors generally into account, including
marketability of the stock (such as volume and pricing rate) and theperformance forecast for MFEC.
532 million Thai baht (¥1,856 million)

106,390,307 shares
Note: If the total number of tendered shares is less than the numberof shares (106,390,307) that TIS planned to purchase, all tenderedshares will be purchased. If the total number of tendered shares
exceeds the number of shares (106,390,307) that TIS planned topurchase, the Company will purchase neither the entire amount nor
any partial amount of the excess shares, and the transfer of sharesand other settlements of the sale and purchase of the tendered shares
will be made using the proportional distribution method.
(8) OtherThe Board of Directors at the target company, MFEC, haveexpressed agreement to the tender offer. In addition, the agenda
item on the Tender Offer was approved by shareholders at thecompany’s ordinary general meeting of shareholders on April 27,2020.
Notes: 1. Details regarding conditions for this tender offer will be announced in Thailand, inaccordance with Thai laws and rules set by Thailand’s Securities and Exchange
Commission.
2. Converted at a rate of 1 Thai baht = ¥3.49, the rate prevailing at the end of June 2020

3.

Overview of Company Subject to Tender Offer (MFEC Public Company Limited)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)NameAddress

MFEC Public Company Limited
699 Modernform Tower, Srinakarind Road, Patthanakan
Suan Luang, Bangkok, Thailand
Representative
Siriwat Vongjarukorn, Chief Executive Officer
Business activities
IT services, system integration
Paid-in capital
441 million Thai baht (¥1,540 million)
Date of establishment March 3, 1997
Listed stock exchange Stock Exchange of Thailand
Major shareholders
TIS Inc.
and shareholding
Kongboonma Family
ratiosSiriwat Vongjarukorn
Sirisak Thirawattanangkul
Prasert Foongvanich

24.90%
3.94%
3.74%
2.93%
2.49%

2

Modernform Group PCL(9)

TIS holds 24.90% equity in MFEC, making it anaffiliate accounted for by the equity method.
One executive officer from TIS holds a position ofdirector (vice-chairman) at MFEC.
TIS and MFEC are party to business-relatedtransactions, based on a business allianceagreement.
Related party MFEC is an affiliate of TIS accounted for by thestatus
equity method.
(10) Consolidated performance and financial position for the past three years
Fiscal year
Fiscal year ended
Fiscal year ended
Fiscal year ended
December 31, 2017 December 31, 2018
December 31, 2019
Net assets
1,987
1,731
1,857
(millions of Thai baht)(6,934 million yen) (6,041 million yen) (6,480 million yen)
Total assets
3,369
3,330
3,670
(millions of Thai baht)(11,757 million yen) (11,621 million yen) (12,808 million yen)
Net assets per share
4.50
3.92
4.20
(Thai baht)(15.70 yen)
(13.68 yen)
(14.67 yen)
Net sales
2,961
3,339
3,688
(millions of Thai baht)(10,333 million yen) (11,653 million yen) (12,871 million yen)
Operating income
142
74241
(millions of Thai baht)(495 million yen)(258 million yen)(841 million yen)
Recurring profit
194
124
278
(millions of Thai baht)(677 million yen)(432 million yen)(970 million yen)
Net income (loss) attributableto owners of the parent
153
(166)
225
company(533 million yen)(-579 million yen)(785 million yen)(millions of Thai baht)
Net income (loss) per share
0.34
0.50
(0.37)(Thai baht)(1.18 yen)
(1.73 yen)(-1.29 yen)
Dividend per share
0.25
0.20
0.35
(Thai baht)(0.87 yen)
(0.69 yen)
(1.22 yen)
Note: Converted at a rate of 1 Thai baht = ¥3.49, the rate prevailing at the end of June 2020

4.

Relationships withTIS

1.86%

Capitalrelationship
Personnel
relationship
Businessrelationship

Number of Shares Acquired, Acquisition Price and Shareholding Status Beforeand After Acquisition

109,921,999 shares(Number of voting rights: 109,921,999)(Percentage of voting rights: 24.90%)
106,390,307 shares(2)
Number of shares acquired(Number of voting rights: 106,390,307)(3)
Acquisition price
532 million Thai baht (¥1,856 million)
216,312,306 shares(Number of voting rights: 216,312,306)(4)
Shareholding after change(Percentage of voting rights: 49.00%)
Notes: 1. Describes situation if TIS is able to purchase planned tender offer MFEC shares throughthis tender offer.
2. Equity stakes held by foreign shareholders are limited to 49% of total shares inaccordance with MFEC’s Articles of Incorporation, which take into consideration
restrictions on foreign investment under the laws of Thailand. Therefore, the numbershares held by TIS at the time the series of steps to turn MFEC into a consolidated
subsidiary may change, based on the shareholding ratios of other foreign shareholders
when the Tender Offer closes.
3. Converted at a rate of 1 Thai baht = 3.49 yen, the rate prevailing at the end of June 2020
(1)

Shareholding prior to change

3

5.

Schedule
Resolution by the TIS Board ofMarch 6, 2020
Directors
Date of MFEC Ordinary GeneralApril 27, 2020
Meeting of Shareholders
Date of application to Thai Securities
and Exchange Commission
June 9, 2020
(Application outlining partial tenderoffer)
Date of approval by Thai Securities
July 8, 2020and Exchange Commission
Date of application to Thai Securities
and Exchange Commission
July 21, 2020
(Application related toimplementation of tender offer)
Start of tender offer
July 23, 2020
End of tender offer
September 28, 2020 (planned)
Share transfer date
October 1, 2020 (planned)
Note: The Tender Offer will go ahead because all conditions required to proceed have been met,
including approval by shareholders at MFEC’s ordinary general meeting of shareholders andapproval by the Thai Securities and Exchange Commission.

6.

Outlook
The results of the Tender Offer will be promptly announced as soon as the details areclear.
If, TIS acquires MFEC shares as planned through the Tender Offer, MFEC and its
10 subsidiaries—a total of 11 companies—will become consolidated subsidiaries of TIS
in accordance with control criteria. Therefore, TIS will likely include the consolidated resultsof MFEC in the Company’s consolidated results from the fourth quarter of fiscal 2021,ending March 31, 2021.

(Reference) Forecast for Fiscal 2021 (announced May 12, 2020), and Fiscal 2020 Results onConsolidated BasisNet income
OperatingRecurring
attributable toNet Sales
IncomeProfitowners of theparent company
MillionMillionMillionMillionCurrent Fiscal Year,ending March 31, 2021
\440,000\44,000\44,000\29,500(forecast)Previous Fiscal Year,ended March 31, 2020
\443,717\44,839\46,070\29,411(actual)END4