January 11, 2024
News Release
Name of listed company
Representative(Securities Code:Contact(TELKyoritsu Maintenance Co., Ltd.
Koji Nakamura, President9616)
Manabu Takaku, Managing Director+81-3-5295-7778)

Notice of capital and business partnership with Daiwa House Industry Co., Ltd. andCosmos Initia Co., Ltd. and acquisition of shares of Cosmos Initia Co., Ltd(making it an affiliated company by application of the equity method)
The Board of Directors of the Company hereby announces the following after resolving today to enter into acapital and business partnership agreement (“Capital and Business Partnership Agreement” hereinafter) with
Daiwa House Industry Co., Ltd. (Securities Code: 1925, listed on the Prime Market of the Tokyo StockExchange; “Daiwa House Industry” hereinafter) and Cosmos Initia Co., Ltd. (Securities Code: 8844, listed on
the Standard Market of the Tokyo Stock Exchange; “Cosmos Initia” hereinafter) and to acquire all shares ofCosmos Initia held by Daiwa House Industry in connection with such agreement.

DetailsI.

Capital and Business Partnership

1. Reasons for capital and business partnership
Since its founding, the Company has pursued a management policy focused on providing services in food,housing, and healing for various life stages. This approach, grounded in the ‘customer first’ principle,contributes significantly to the broader development of society. Taking into account the recent businessenvironment surrounding the Company, in May 2023 we formulated KYORITSU Growth Vision / Rise Up
Plan 2028, our Medium-Term Management Plan to achieve sustainable growth and establish ourselves as acentennial company. We aim to build solid business foundations capable of withstanding a changing
environment while leveraging our strengths cultivated to date to expand the market.
The Medium-Term Management Plan articulates the themes of both “Recovering from COVID-19 toachieve renewed growth” and “Pursuing further growth in customer satisfaction and regional expansion.”
Our long-term vision is to achieve net sales of 300 billion yen and operating income of 30 billion yen by2030, with a total of 200 billion yen planned for investment, including development investment. This time,
the Company will enter into a capital and business partnership with Daiwa House Industry and CosmosInitia. Daiwa House Industry offers information on development projects in various fields and a record ofdevelopment achievements, and our goal is to strategically launch new businesses through this capital andbusiness partnership. Cosmos Initia has a wealth of experience in housing and accommodation-related
development, and we aim, through this capital and business partnership, to further accelerate thedevelopment and promotion of the hotel business, dormitory business, and senior life business (residencesfor the elderly), and to raise operational efficiency in the management business. We will also strive to1

promote collaboration among the three companies, including in promoting joint business projects andpersonnel exchanges.
2. Details of the capital and business partnership(1) Details of the capital partnership
The Company is to acquire 8,480,000 shares of the 21,428,616 shares of Cosmos Initia held by Daiwa
House Industry for 6,029 million yen. As a result, the number of Cosmos Initia shares held by theCompany will be 8,480,000 shares (representing 25.05% of the total number of voting rights).
Through this share acquisition, Cosmos Initia will become an affiliated company by application of theequity method.
(2) Details of the business partnership
The Company, Daiwa House Industry, and Cosmos Initia have determined to take the following actions
pursuant to the capital and business partnership:(i) Business partnership among the three companies
The Daiwa House Group and Cosmos Initia Group will proactively provide information on the hotelbusiness, dormitory business, senior life business, etc. promoted by our Group and promotecollaboration, including the promotion of joint business projects and personnel exchanges.
(ii) Business partnership between the two companies (our Group and the Daiwa House Group)
Our Group and the Daiwa House Group will promote joint business projects (such as cases where ourGroup undertakes the operation of buildings constructed by the Daiwa House Group), exchanges ofpersonnel, and other forms of partnerships in the businesses conducted by each Group.
(iii) Business partnership between the two companies (our Group and the Cosmos Initia Group)
Our Group and the Cosmos Initia Group aim to achieve synergies between the hotel, dormitory, andsenior life businesses promoted by our Group and the real estate development capabilities of theCosmos Initia Group (land information, planning, cost and schedule management, etc.), and will
promote partnerships by mutually acquiring business opportunities through proactive information
sharing, utilizing each other’s business expertise, launching joint business projects, exchanging
human resources, and engaging in other initiatives.
(iv) Business partnership between the two companies (Daiwa House Group and Cosmos Initia Group)
The Daiwa House Group and Cosmos Initia Group will continue to promote cooperation in thebusinesses pursued by each group. The business partnership based on business partnershipagreements between Daiwa House Group and Cosmos Initia Group (including those relating to thepromotion of joint business projects, exchange of personnel, cooperation with Daiwa House Group’s
investment companies and the granting of Daiwa House Industry’s loan guarantee facility to CosmosInitia) already concluded as of the date of execution of this Capital and Business Partnership
Agreement will continue for the time being.
3. Overview of counterparty to the capital and business partnership(i) Cosmos Initia
(1)
(2)
(3)
(4)

Name
Location
Name and title ofrepresentative
Business areas

Cosmos Initia Co., Ltd.
Shintamachi bldg., Shiba 5-34-6, Minato-ku, Tokyo
Ryotaro Takachi, President
Real estate sales, real estate rental, and real estate brokerage
2(5)
(6)

Share capital
Established

5,000 million yen
June 20, 1969
Daiwa House Industry
63.25%
Akihiko Tokitsu
2.29%
Major shareholders andHisanao Mitsu
1.29%
ratio of shares held toGOLDMAN SACHS INTERNATIONAL
1.20%
total number of shares
UBS AG LONDON A/C IPB SEGREGATED CLIENT ACCOUNT
1.18%
(7)
issued as of September
Takeshi Yamaji
0.97%
30, 2023 (excludingYouichi Maruta
0.73%treasury shares)
BNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC)
0.66%
Koi Kuroda
0.61%
JPMorgan Securities Japan Co., Ltd.
0.55%
Capital relationship
Not applicable
Relationship between
Personnel relationship Not applicable(8) listed company andBusiness relationship Not applicable
company in question
Related parties
Not applicable
Consolidated operating results and consolidated financial position of the company for the last three
(9)
years
Year ended March 31, 2021 Year ended March 31, 2022 Year ended March 31, 2023
Financial period
Consolidated net assets
34,981 million yen
36,607 million yen
41,512 million yen
Consolidated total assets
143,513 million yen
145,210 million yen
157,384 million yen
Consolidated net assets per
1,016.29 yen
1,063.23 yen
1,205.03 yen
shareConsolidate net sales
107,257 million yen
107,349 million yen
123,374 million yen
Consolidated operating
2,376 million yen
3,351 million yen
4,924 million yen
incomeConsolidated ordinary
2,207 million yen
2,610 million yen
4,469 million yen
incomeNet income attributable to2,007 million yen
1,703 million yen
3,524 million yen
owners of parent
Consolidated net income per59.25 yen50.29 yen104.78 yen
share
Income per share
7.00 yen
7.00 yen
14.00 yen(ii) Daiwa House Industry
(1)
(2)
(3)

NameLocation
Name and title ofrepresentative(4)

Business areas

(5)
(6)

Share capital
EstablishedDaiwa House Industry Co., Ltd.
3-3-5 Umeda, Kita-ku, Osaka
Keiichi Yoshii, President and CEO
General construction business, urban development business, overseas
business, and other161,957 million yen
March 4, 19473The Master Trust Bank of Japan, Ltd. (Trust account)
16.39%
Custody Bank of Japan Ltd (Trust account)
6.96%
Major shareholders andSumitomo Mitsui Banking Corporation
2.20%
ratio of shares held toDaiwa House Employee Stock Ownership Association
2.18%
total number of shares
STATE STREET BANK WEST CLIENT – TREATY 505234
1.83%
(7)
issued as of September
Nippon Life Insurance Company
1.81%
30, 2023 (excluding
SSBTC CLIENT OMNIBUS ACCOUNT
1.49%
treasury shares)
JPMorgan Securities Japan Co., Ltd.
1.39%
JP MORGAN CHASE BANK 385781
1.33%
MUFG Bank, Ltd.
1.29%
Capital relationship
Not applicable
Relationship between
Personnel relationship Not applicable(8) listed company andBusiness relationship Not applicable
company in question
Related parties
Not applicable
Consolidated operating results and consolidated financial position of the company for the last three
(9)
years
Year ended March 31, 2021 Year ended March 31, 2022 Year ended March 31, 2023
Financial period
Consolidated net assets
1,893,504 million yen 2,111,385 million yen
2,388,914 million yen
Consolidated total assets
5,053,052 million yen 5,521,662 million yen
6,142,067 million yen
Consolidated net assets per
2,805.09 yen
3,081.07 yen
3,466.86 yen
shareConsolidate net sales
4,126,769 million yen 4,439,536 million yen
4,908,199 million yen
Consolidated operating
357,121 million yen
383,256 million yen
465,370 million yen
incomeConsolidated ordinary
337,830 million yen
376,246 million yen
456,012 million yen
incomeNet income attributable to
195,076 million yen
225,272 million yen
308,399 million yen
owners of parent
Consolidated net income per297.18 yen343.82 yen
469.12 yen
share
Income per share
116.00 yen
126.00 yen
130.00 yen
4. Dispatching of directors
Upon the execution of the Capital and Business Partnership Agreement, the Company will acquire theright to nominate one candidate for the director of Cosmos Initia, and Daiwa House Industry will acquire
the right to nominate two candidates for the director of the same company. This fact will be submitted tothe annual general meeting of shareholders of Cosmos Initia to be held in June 2024.
5. Schedule
(1)
(2)
(3)

Date of Board of Directors resolution
Execution date of the Capital andBusiness Partnership Agreement
Start date of the capital and businesspartnership

January 11, 2024
January 11, 2024
February 26, 2024 (scheduled)46. Future outlook
The impact of this capital and business partnership on our consolidated results is currently underevaluation. Any matters that arise and warrant disclosure will be promptly disclosed.

II. Acquisition of Shares
1. Reason for acquisition of shares
Please refer to 1. Reasons for capital and business partnership in Ⅰ. Capital and Business Partnership above.
2. Overview of the company to become the affiliated company by application of the equity method
Please refer to 3. Overview of counterparty to the capital and business partnership, (i) Cosmos Initia, in Ⅰ.
Capital and Business Partnership above.
3. Overview of the party from which the Company will acquire the shares
Please refer to 3. Overview of counterparty to the capital and business partnership, (ii) Daiwa House
Industry, in Ⅰ. Capital and Business Partnership above.
4. Number of shares to be acquired, acquisition price, and status of shares held before and after acquisition(1)

Shares held beforeacquisition(2)

Shares to be acquired(3)Acquisition price(4)

Shares held after
acquisition

0 shares(Number of voting rights: 0)(Ratio to total number of voting rights: 0.00%)
8,480,000 shares(The number of voting rights: 84,800)
Common stock of Cosmos Initia Co., Ltd.: 6,029 million yen
8,480,000 shares(Number of voting rights: 84,800)(Ratio to total number of voting rights: 25.05%)

5. Schedule
(1)
(2)
(3)

Date of Board ofDirectors resolution
Execution date of thestock transfer agreement
Date of the shareacquisition

January 11, 2024
January 11, 2024
February 26, 2024 (scheduled)

6. Future outlook
The impact of this share acquisition on our consolidated results is currently under evaluation. Any mattersthat arise and warrant disclosure will be promptly disclosed.

5

(Reference) Forecast of consolidated earnings for the current fiscal year (announced on November 9, 2023)
and consolidated results for the previous fiscal year
Consolidated
net sales(Millions of yen)

Consolidated
operating income(Millions of yen)

Consolidated
ordinary income(Millions of yen)

Net income
attributable toowners of parent(Millions of yen)

Forecasts ofconsolidated financialresults(Fiscal year ending
March 31, 2024)

200,000

13,00012,0007,000

Consolidated results forthe previous fiscal year
(Fiscal year ended
March 31, 2023)

175,630

7,326

7,115

4,2416