Mitsubishi Electric and Mitsubishi Heavy Industries Definitively Agreeto Integrate Their Power-generator Systems Businesses
TOKYO, May 29, 2023 – Mitsubishi Electric Corporation (TOKYO: 6503) and Mitsubishi Heavy Industries,Ltd. (TOKYO: 7011) announced today that they have reached a definitive agreement to integrate their powergenerator systems businesses under a joint venture. As previously announced, the two firms agreed in principle
last December 26 on a plan to transfer their respective businesses focused on power-generator systems to aproposed joint-venture company, which Mitsubishi Electric and Mitsubishi Heavy Industries will both be theshareholder, effective April 1, 2024.
Today, the two companies have signed definitive agreements specifying the terms and conditions of integrating
their power-generator systems businesses, the details of which are outlined below. Prior to the establishmentof the joint-venture company, a preparatory company will be established in due course, after which theremaining details will be finalized by the three parties by around the end of December 2023.
1. Purpose of Integration
Climate change due to global warming is triggering accelerating efforts worldwide to achieve carbon neutrality
by reducing greenhouse gas emissions to net zero. Increasing demand for electricity in growing economies,
particularly emerging markets, and heightened concerns about energy security, are expected to drive practicaltransitions to new forms of energy, such as hydrogen, ammonia and other carbon-free fuels, alongside existing
thermal-power generation. Large power plants, which have served as the backbone of power infrastructure sofar, will play an important transitional role in balancing the variability of renewable energy due to weather andother factors.
In the midst of such market changes, Mitsubishi Electric and Mitsubishi Heavy Industries have agreed tointegrate related businesses, technologies and assets to enhance market competitiveness. The integration is
expected to strengthen the partnership between the two companies to an unprecedented level in order to expand
their power-generator systems business globally and contribute to a carbon-neutral world.
2. Details of Integration(1) Schedule
Execution of basic agreement
Decision on Absorption-type Company Split
Execution of definitive agreementsExecution of company-split agreement
Effective date of company splits

December 26, 2022
May 29, 2023
End of December 2023 (tentative)
April 1, 2024 (tentative)

Note 1: Implementation of the planned business integration is subject to clearances, approvals and/or completion ofprocesses required by and from relevant governmental agencies and competition authorities.
Note 2: Since both Mitsubishi Electric and Mitsubishi Heavy Industries are expected to implement simple
absorption-type splits, as set forth in Article 784, Paragraph 2 of the Companies Act of Japan, shareholder approvalwill not be required by either company.

1/4

(2) Method and Equity Contribution
The method will be an absorption-type company split in which a preparatory company, which will beestablished by Mitsubishi Electric as a wholly owned subsidiary, will become the succeeding company,and Mitsubishi Electric and Mitsubishi Heavy Industries will be the transferring companies. Thepreparation company will issue common stock for the split from Mitsubishi Electric and Mitsubishi
Heavy Industries, with all shares being allotted to Mitsubishi Electric and Mitsubishi Heavy Industries
respectively, however both companies will mutually determine the number of shares to be allotted to eachcompany. The two companies will make adjustments so that Mitsubishi Electric will hold 51% andMitsubishi Heavy Industries will hold 49% of the shares in the joint-venture company as of the effective
date.
(3)

Share Acquisition Rights and Bonds with Share Acquisition Rights
Mitsubishi Electric has not issued any share acquisition rights nor has it issued any bonds with shareacquisition rights. The obligations under share acquisition rights issued by Mitsubishi Heavy Industries
will not be transferred to or succeeded by the joint-venture company. Mitsubishi Heavy Industries has
not issued any bonds with share acquisition rights.

(4)

Changes in Amounts of Capital Accompanying Company Splits
There will be no change in the capital stock or capital reserves of Mitsubishi Electric or Mitsubishi HeavyIndustries as a result of the company splits.

(5) Rights and Obligations Transferred to Joint-venture Company
The joint-venture company will assume ownership of the related assets, liabilities, other rights andobligations, and existing contracts of Mitsubishi Electric and Mitsubishi Heavy Industries. Details of theintegration including assets, liabilities, contracts, etc., will be specified in the absorption-type companysplit agreement to be executed around the end of December 2023.
(6)

Outlook on Fulfillment of Obligations
Following the company splits, the obligations to be borne by the joint-venture company are expected tobe duly performed.

3. Calculation Basis, etc., Concerning Allotment under the Company Splits
The number of shares of the joint-venture company to be allotted to Mitsubishi Electric and Mitsubishi Heavy
Industries will be determined through discussions and negotiations, based on the value of the businesses to betransferred after considering the financial performance (revenues, expenses, profits and cash flows) of thebusinesses subject to the integration, in addition to the assets, liabilities, existing contracts, rights andobligations, etc. to be transferred.

2/4

4. Profile of the Parties of the Company Split
Company name
Mitsubishi Electric Corporation(as of March 31, 2023)
Head Office
2-7-3 Marunouchi, Chiyoda-ku, Tokyo
Representative
Kei Uruma
Representative Executive Officer,President & CEO
Summary of BusinessDevelopment, manufacturing, sales,and service of products such as
Infrastructure, Industry and Mobility,
Life, and Business Platform
Established
January 15, 1921
Paid-in Capital
175,820 million yenShares Issued
2,147,201,551 sharesBook Closing Date
March 31
Major Shareholders
The Master Trust Bank of Japan, Ltd.
and(Trust Account): 15.7%
Shareholding Ratio
SSBTC CLIENT OMNIBUS
ACCOUNT: 5.6%
Custody Bank of Japan, Ltd. (TrustAccount): 5.0%

Mitsubishi Heavy Industries, Ltd.
(as of March 31, 2023)
3-2-3 Marunouchi, Chiyoda-ku, Tokyo
Seiji Izumisawa
President & CEO
Major products and operations: Energy
Systems, Plants & Infrastructure Systems,Logistics, Thermal & Drive Systems,Aircraft, Defense & Space
January 11, 1950
265,608 million yen
337,364,781 shares
March 31
The Master Trust Bank of Japan, Ltd.
(Trust Account): 15.9%
Custody Bank of Japan, Ltd. (TrustAccount): 5.5%
Meiji Yasuda Life Insurance Company:
2.3%

Operating Results for the Most Recent Business Year and Financial Positions as of the End of the Business Year(FY ended March 2023)

Total Equity
3,363,224 million yen
1,883,984 million yen
Total Assets
5,582,519 million yen
5,474,812 million yenEquity Attributable to1,533.98 yen
5,183.10 yen
Shareholders per ShareRevenue
5,003,694 million yen
4,202,797 million yen
Operating Profit
262,352 million yen
Profit from Business
193,324 million yen
Activities
Profit Before Income
292,179 million yen
191,126 million yen
Taxes
Net Profit Attributable
213,908 million yen
130,451 million yen
to Shareholders
Basic Earnings perShare Attributable to101.30 yen
388.43 yen
Shareholders
Note: Details of the joint-venture company will be announced in a timely manner once confirmed with respect to thecompany splits5. Overview of Business to Be Transferred
The scope of the business integration will be as follows.
(1) Thermal power generation businesses① Design, manufacture, quality control, sales and after-sales servicing of electric generators② Engineering, quality control, sales and after-sales servicing of electrical equipment associated withgenerators(2) Nuclear power generation business① Design, manufacture, quality control and after-sales servicing of electric generators(3) Hydroelectric power generation business① Manufacture, quality control and after-sales servicing of electric generators
Mitsubishi Electric and Mitsubishi Heavy Industries will promptly announce the operating results, assets andliabilities of the divisions to be split off as soon as they are determined.

3/4

6. Profiles of the Parties Post-Integration Parties(1) Name(2) Head office(3) Representative(4) Business(5) Capital(6) Fiscal year end(1) Name(2) Head office(3) Representative(4) Business(5) Capital(6) Fiscal year end

Transferring Company
Mitsubishi Electric Corporation
2-7-3 Marunouchi, Chiyoda-ku, TokyoKei Uruma
Representative Executive Officer,President & CEO
Development, manufacturing, sales, and service of products such as
Infrastructure, Industry and Mobility, Life, and Business Platform
175,820 million yen
March 31Transferring Company
Mitsubishi Heavy Industries, Ltd.
3-2-3 Marunouchi, Chiyoda-ku, Tokyo
Seiji Izumisawa
President & CEO
Major products and operations: Energy Systems, Plants &Infrastructure Systems, Logistics, Thermal & Drive Systems,Aircraft, Defense & Space265,608 million yen
March 31
Joint-Venture Company(1) Name(Not yet determined)(2) Head office
Kobe City, Hyogo(3) Representative(Not yet determined)(4) Business
Please refer to 5.
(5) Capital(Not yet determined)(6) Fiscal year end
March 31
Note: The capital statuses of the joint-venture company will be announced in a timely manner once confirmed.

7. Outlook
The impact of the company splits on the business results and outlooks of Mitsubishi Electric and Mitsubishi
Heavy Industries will be announced in a timely manner once confirmed.
Media inquiries
Mitsubishi Electric Corporation
Public Relations Division
prd.gnews@nk.MitsubishiElectric.co.jp
Mitsubishi Heavy Industries, Ltd.
Corporate Communication Departmentmediacontact_global@mhi.com

4/4