March 8, 2019
To whom it may concern
TOKAI Holdings Corporation
Katsuhiko Tokita, President & CEO(Code No. 3167 Tokyo Stock Exchange First Section)

Priority Negotiation Right Granted for Transfer of Nikaho City Gas BusinessWe are pleased to announce as indicated in the attachment document that TOKAI GAS CORPORATION (headoffice: Yaizu City, Shizuoka Prefecture, Representative Director: Shingo Takahashi, “TOKAI GAS”), our 100%
subsidiary, has been granted the priority negotiation right for the transfer of the gas business operated by the Cityof Nikaho, Akita Prefecture.
As a founding company of our Group, TOKAI GAS operates the city gas business in the Shida Area (Yaizu City,Fujieda City, and Shimada City) in Shizuoka Prefecture. Last year, the company signed an agreement with theTown of Shimonita, Gunma Prefecture, to take over the town’s gas business, which is scheduled to begin
operation in April this year.
Based on the ideas that the city gas business is closely related to daily life of people living in the service areas andour growth is based on building the relationship of trust with customers, the company is working on(1)strengthening the customer contact with themes closely related to daily life, (2)actively promoting advancedenergy systems that make use of our advanced technological capabilities, (3)enhancing trust through various
community contribution activities, and (4)becoming a role model business of the Group’s TLC vision.
Our Group is promoting a growth strategy centered on the medium-term management plan “Innovation Plan 2020
‘JUMP’,” which will end in FY2020. Strengthening our core business is one of the priority measures of this plan,
and we aim to expand our customer base by extending our city gas business over a wide area. We will contributeto the development of the local community by leveraging strengths our Group has cultivated as a local enterprise.

Contact: Yoshihiro Taniguchi
Public Relations and Investor Relations Office
TEL: +81-(0)3-5404-2891
Email: overseas_IR@tokaigroup.co.jp

March 8, 2019

To whom it may concern
TOKAI GAS CORPORATION

Priority Negotiation Right Granted for Transfer of Nikaho City Gas BusinessWe are pleased to announce that TOKAI GAS CORPORATION has been granted the priority negotiationright for transfer of the gas business operated by the City of Nikaho, Akita Prefecture. We will discuss thedetails of the terms and conditions of the business transfer with the City of Nikaho toward conclusion of abusiness transfer agreement.
For this business transfer, the City of Nikaho began soliciting applications on July 17, 2018.
After investigating the nature of the business and assessing its profitability, we concluded that ourinvolvement in this business would increase the corporate and shareholder value of the TOKAI Group andcontribute to wider use of natural gas and to the benefit of the local community. Following this conclusion,
we submitted a business proposal to the City of Nikaho.
After a hearing with the City’s committee for selecting the gas business transferee, we were selected as thebest proposer. Based on this result, the City of Nikaho considered whom to grant the priority negotiationright and selected TOKAI GAS.
As part of our efforts to take over the gas business the City of Nikaho has operated so far, we will establish
safety systems and standards to further improve the level of safety. Based on our Group’s TLC (Total LifeConcierge) concept for offering customers comprehensive and precise support for comfortable lifestyles, weaim to be a company that contributes to better life of people in Nikaho City and the development of the localcommunity.
1.

Process of Accepting Transfer of Nikaho City Gas Business
Month and year
Description
July 17, 2018
OctoberJanuary 2019
February

February 20
March 8The City of Nikaho announced application guidelines for gas business transfer
We applied for the business transfer and passed the qualification screening (firstexamination)
We submitted a business proposal to the City of Nikaho
The committee for selecting the gas business transferee reported to the mayor ofNikaho the result of the examination that the committee selected us as the best
proposer
The mayor of Nikaho notified us of the decision that the priority negotiation right
was granted to us
A briefing session was held for the Nikaho City Council

2.

Future Schedule
Month and year
March 2019
April or June
July to August
April 1, 2020

3.

Description
A provisional business transfer agreement will be concluded with the City of Nikaho
A business transfer agreement will be signed with the City of Nikaho
The application for approval of business transfer will be submitted to the regulatory
authority, Tohoku Bureau of Economy, Trade and Industry
Transfer of businessBusiness Overview (as of FY2017)
Nikaho City Gas and Waterworks Bureau
Incorporation
October 1, 2005 (municipal merger)
Representative
Yuji Ichikawa, Mayor of Nikaho
Address
Number ofemployees
Service area
Number ofcustomer
contracts
Gas sales
volumeGas sales
Gas type

4 Aza Funabashi, Hirasawa, Nikaho City,
Akita Prefecture
7 gas business accounting workers(Total of 15 persons in the bureau,
including water business accounting)Nikaho City
City gas: 5,255 contracts
City gas: 2,270 thousand m3

City gas: 411 million yen
13A

TOKAI GAS CORPORATION
December 12, 1966
Shingo Takahashi, Representative Directorand President
74−3 Shiotsu, Yaizu City, Shizuoka
Prefecture
169 employees

Yaizu City, Fujieda City, and Shimada City
City gas: 54,506 contracts(Community gas: 1,311 contracts, LP gas:17,209 contracts)
City gas: 138,111 thousand m3(Community gas: 159 thousand m3, LPgas: 4,913 t)
City gas: 10,591 million yen
13A[Inquiries about this press release]
Wide Area Sales Department, TOKAI GAS CORPORATION
TEL：054-647-7151 Website（https://www.tokaigas.co.jp/）