April 27, 2018
NEWS RELEASE

Name of Listed
Company
Representative

TSUMURA & CO.

Contact

Yosuke Tsuchiya

Terukazu Kato
President & Representative Director(Code: 4540 First Section of the Tokyo
Stock Exchange)
Head of Corporate Communications Dept.
TEL 03-6361-7100

Capital and Business Alliance with MYFARMTSUMURA & CO. (hereinafter, “Tsumura”) announces that at a meeting held on April 27, 2018, the Board ofDirectors passed a resolution to form a capital and business alliance (hereinafter “Capital and Business Alliance”) withMYFARM Inc. (hereinafter, “MYFARM”) and on the same date concluded a Capital and Business Alliance Agreementwith MYFARM.
1. Purpose and reason for the Capital and Business Alliance
Tsumura is expanding the cultivation of raw material crude drugs both at home and abroad in tandem with the increasein demand for prescription Kampo products. MYFARM possesses a network with producers in Japan as well as
cultivation technologies and knowhow, including those for growing vegetables. The company also has a track record inareas such as the development and expansion of producing areas. In 2017, Tsumura and MYFARM entered into abusiness outsourcing agreement related to the expansion of crude drug cultivation and have since been undertaking theexpansion of production here in Japan. Tsumura aims to form a long-term and strong strategic partnership withMYFARM. Accordingly, it has formed a Capital and Business Alliance to further expand the cultivation of crude drugsin Japan.
2. Details of the Capital and Business Alliance(1) Details of the capital alliance
Tsumura will acquire 3,000 shares in MYFARM issued by way of third-party allotment for a price of ¥300 million.
After the completion of the third-party allotment, Tsumura will hold 12.8% of total voting rights and 12.8% of total
shares outstanding in MYFARM.
(2) Details of the business alliance
i. Expand production of crude drugs in Japan by leveraging the network MYFARM has with producers andproduction organizations.
ii. Jointly develop technologies for the purpose of expanding crude drug production.
iii. Implement crude drug production training, mainly at the Agri-innovation School run by MYFARM.

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3. Summary of Capital and Business Alliance Partner MYFARM (current as of March 31, 2018)(1)

Name of Company

MYFARM Inc.

(2)

Location

KYOCA Kaikan 3rd Floor, 1-1 Sujakushokaicho, Shimogyo-ku, Kyoto(3)

RepresentativeKazuma Nishitsuji, CEO & Representative Director(4)

Regeneration of abandoned farm land and monetization business, seed business(lease farms and publish an information magazine), training and education businessBusiness Description(school for new farmers, farm management school) , connection business (BtoB
retail sales), delivery business (BtoC distribution and retail), personnel referral
services and temp agency business, support to companies entering the industry,
support for commercialization(5)

Capital¥172 million(6)

Date of Foundation

September 26, 2007

(7)

Total Shares Outstanding

20,375 shares(8)

Fiscal-year End

December(9)

Number of Employees(10)

48 full time and 103 part time employees(includes employees working at MYFARM Origin Inc. and MY HONEY Inc.)
Osaka Prefecture, Nara Prefecture, Chiba Prefecture, and the town of Toyoura,

Main Customers

Hokkaido, and the city of Isumi, Chiba Prefecture
HITOWA Kids Life Co., Ltd., Mitsui Fudosan Residential Co., Ltd., Nose Electric
Railway Co., Ltd. and others

(11)
(12)

Main Banks

Sumitomo Mitsui Banking Corporation, The Shiga Bank, Ltd., and The Kyoto
Shinkin Bank

Relationship Betweenthe Parties
Capital Relationship

There is no relationship to be disclosed between the parties.

Personal Relationship

There is no relationship to be disclosed between the parties.

Transactional
Relationship
Status as Related Party

In 2017, both parties entered into a contract related to the cultivation of crude drugs
and related research. Production of some of the crude drugs is being expanded inJapan.
There is no relationship to be disclosed between the parties.

*MYFARM is an unlisted company therefore it does not disclose financial details, including information on its major
shareholders, shareholder ratios, business results and financial position.
4. Schedule(1) Resolution of the Board of Directors

April 27, 2018

(2) Execution of the Capital and Business Alliance Agreement

April 27, 2018(3) Payment for shares acquired

May 10, 2018

5. Future Prospects
The impact of the Capital and Business Alliance on consolidated results for the fiscal year ending March 31, 2019 will
be insignificant. Tsumura will promptly announce any matters that require disclosure in the future.

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