Notification Concerning Absorption-type Mergerof Consolidated Subsidiary
2011/08/30 in Japan | Page 1 / 3

Tuesday, August 30, 2011

For Immediate Release
Kanamoto Company, Limited
Stock Code 9678
Tokyo Stock Exchange 1st Section; Sapporo Stock Exchange
Kanchu Kanamoto
President and CEO< Contact for inquiries concerning this material >Yuichi Takayama
Manager, Investor and Public Relations, Office of the President
Telephone: + 81–11–209–1631 / 080-5589-7857

Notification Concerning Absorption-type Merger ofConsolidated Subsidiary
At its Board of Directors meeting held today, Kanamoto Co., Ltd. (Kanchu Kanamoto, President; Head Office:Sapporo, Japan), Japan’s leading construction equipment rental company, resolved to absorb and merge withSRG Kanamoto Co., Ltd. (“SRG Kanamoto”), a wholly-owned subsidiary company. Details are provided below.
Because the merger is a simple absorption-type merger of a wholly-owned subsidiary company, disclosure ofcertain disclosure matters and contents is omitted.
1. Objective of the merger and business organization
Kanamoto will undertake the merger with the objectives of creating an organization capable of responding flexiblyand appropriately to rental demand, by establishing a new “Temporary Equipment Rental Department” within
Kanamoto’s Construction Equipment Rental Division (Hokkaido Region) to handle rentals of temporary scaffolding
materials and succeed to the temporary scaffolding materials rental business of SRG Kanamoto, and further
enhancing customer service by improving the efficiency of operations.
2. Summary of the merger(1) Merger schedule
Approval of corporate resolution:

August 30, 2011

Signing of merger agreement:

August 30, 2011

Merger date:November 1, 2011 (Effective date)The merger will be executed by Kanamoto Co., Ltd. and SRG Kanamoto without obtaining the approval of theGeneral Meeting of the Shareholders concerning the merger agreement, based on the provisions for a simple
merger prescribed in Article 796 paragraph (3) of the Companies Act and the provisions for a short form
merger prescribed in Article 784 paragraph (1) of the same Act.
(2) Merger method
An absorption-type merger in which Kanamoto will be the surviving company and SRG Kanamoto will bedissolved.

Notification Concerning Absorption-type Mergerof Consolidated Subsidiary
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Because SRG Kanamoto currently has negative equity, and eliminating this negative equity condition before
the merger is expected to be difficult, Kanamoto will eliminate the negative equity condition prior to the merger
by waiving a portion of its claims against SRG Kanamoto.
(3) Merger ratio and amount of money delivered due to merger
The merger is a merger with a wholly-owned subsidiary company, and there will be no new share issuanceand no money will be delivered due to the merger.
(4) Handling of predecessor company’s stock acquisition rights or corporate bonds with stock acquisition rights
There are no material items to report.
3. Summary of operating results of merger companies
Kanamoto Co., Ltd.

SRG Kanamoto Co., Ltd.

(Surviving company)(Extinguished company)

Rental and sale of construction

Rental and sale of temporary

equipment

scaffolding materials

October 1964

August 1999

Sapporo, Hokkaido

Sapporo, Hokkaido

Kanchu Kanamoto, President andTatsuo Kanamoto, President andRepresentative Director

Representative Director

Capital9,696 million yen

100 million yen

Shares issued

32,872,241 shares

6,000 sharesFiscal year-end

October 31

August 31

Trade nameBusiness

Established
Head Office location
Representative’s name andofficial position

Largest shareholders and

ORIX Corporation (4.99%)

percent owned

Japan Trustee Services Bank, Ltd.

Kanamoto Co., Ltd. (100.0%)(Trust Account 3.83%)
Taichu Kanamoto (3.68%)
Recent operating results (Millions of yen, except for net income per share which is in yen)

Most recent business period

Kanamoto Co., Ltd.

SRG Kanamoto Co., Ltd.

(Surviving company)(Extinguished company)FYE October 2010

FYE August 2010

Revenues

58,083688

Operating income

2,538

3

Ordinary income

2,3707

Net income

1,032

6Net assets

37,089– 263

Total assets

97,729570

Net income per share of31.41

1,112.76

1,128.29– 43,926.61

common stock
Net assets per shareNotification Concerning Absorption-type Mergerof Consolidated Subsidiary
2011/08/30 in Japan | Page 3 / 3

4. Status after merger(1) Trade name, business activities, head office location, representative, equity and accounting period
There will be no changes as a result of this merger.
(2) Future outlook
The merger is a merger between Kanamoto and a 100% consolidated subsidiary of Kanamoto, and will nothave any material effect on Kanamoto’s consolidated and non-consolidated operating results.
Kanamoto plans to release its Nine-month Consolidated Financial Report for the Fiscal Year ending
October 31, 2011 on September 2, 2011.
End