January 27, 2023
Company name: DKK Co., Ltd.
Representative: Tadatoshi Kondo, President & Representative Director(Securities code: 6706, Tokyo Stock Exchange Prime Market)
Contact: Kazuhiro Ito, Director, Senior Executive Managing Officer(TEL. +81-3-3216-1671)

Announcement of organizational restructuring (merger and company split) of the
DKK Group
DKK Co., Ltd. resolved on organizational restructuring (merger and company split), to be effective on
April 1, 2023, with DKC Co., Ltd., Koshuha Co., Ltd., and Denko Techno Heat Co., Ltd., our wholly
owned subsidiaries, at the Board of Directors’ meeting held today.
The organizational restructuring will be carried out with and between our wholly owned subsidiaries(hereinafter “within our Group”), and disclosed matters and information are partially omitted.

1.

Overview of the organizational restructuring

In this organizational restructuring, an absorption-type merger in which DKK Co., Ltd. is the surviving
company and DKC Co., Ltd. is the absorbed company will be carried out to improve profitability in theconstruction business. An absorption-type split in which Koshuha Co., Ltd. is the absorbed and splitcompany and Denko Techno Heat Co., Ltd. succeeds the contracted heat treatment processing business,
as well as an absorption-type merger in which DKK Co., Ltd. is the surviving company and KoshuhaCo., Ltd. is the absorbed company, will also be carried out on the same day to concentrate highfrequency business and improve competitiveness.

2.

Purpose of the organizational restructuring

The DKK Group aims to contribute to society, increase its corporate value, and realize sustainablegrowth as our medium-to-long-term goals. In the DKK-Plan2025, our medium-term business plan
disclosed in May 2022, we mentioned our intention to optimize our business portfolio according tochanges in the business environment and business structure and carry out radical organizational reform.
In the organization reform, we will select and concentrate our businesses and aggregate overlapping
businesses and resources within our Group to make the organizational system more efficient, improve
the profit structure, and create a synergetic effect, thereby sustainably improving its corporate value.
In the organizational restructuring, the managerial departments of our Group will be made more
efficient and slimmer, while human resources will be concentrated to improve business execution
capacity and make the business more efficient in the construction departments, and businesses will beconcentrated to improve sales capacity and business execution capacity in the high-frequencydepartments.
The DKK Group will continue to promote organizational reforms to optimize its business portfolio,
execute growth strategies, and sustainably improve its corporate value.

3.

Key points of the organizational restructuring(1) Date of the organizational restructuring
Absorption-type split agreement and absorptiontype merger agreement conclusion date

Wednesday, February 22, 2023 (scheduled)

Effective date

Saturday, April 1, 2023 (scheduled)(2) Method of the organizational restructuring
An absorption-type merger in which DKK Co., Ltd. is the surviving company and DKC Co., Ltd.
is the absorbed company, an absorption-type split in which Denko Techno Heat is the succeedingcompany and Koshuha Co., Ltd. is the absorbed company, and an absorption-type merger in which
DKK Co., Ltd. is the surviving company and Koshuha Co., Ltd. is the absorbed company will also
be carried out.
(3) Allotment relating to the organizational restructuring
The organizational restructuring is carried out within our Group, and there is no allotment of sharesor other money.
(4) Handling of stock acquisition rights and bonds with stock acquisition rights in the organizational
restructuring
Not applicable.
(5) Change in capital due to the organizational restructuring
There is no change in the capital of each company due to the organizational restructuring.
(6) Rights and duties the surviving and succeeding companies succeed in the organizational
restructuring
The Company succeeds the rights and duties relating to all businesses of DKC Co., Ltd. and therights and duties relating to the vacuum furnace, special furnace, and generator businesses ofKoshuha Co., Ltd. based on the absorption-type merger agreement.
Denko Techno Heat Co., Ltd. succeeds the rights and duties relating to the coil-related businessand contracted high-frequency heat treatment processing business of Koshuha Co., Ltd. based on
the absorption-type split agreement.
(7) Prospect of fulfillment of obligations
The Company judges that there is no problem to fulfillment of obligations to be borne by eachcompany after the organizational restructuring.

4.

Overview of companies after the organizational restructuring

Company name

Surviving company inabsorption-type merger

Surviving company inabsorption-type split

DKK Co., Ltd.

Denko Techno HeatCo., Ltd.

Absorbed company in Absorbed company inabsorption-type
absorption-type split andmerger
absorption-type merger
DKC Co., Ltd.

Koshuha Co., Ltd.

1-1-1 Nishi
4052-1 Nakatsu,
Tsurugaoka,
Aikawa-machi,
Fujimino-shi, Saitama Aiko-gun, KanagawaMichinori Okazaki,
Tsuyoshi Yamamoto,Shunichi Nishizawa,
Name and title of Tadatoshi Kondo, President
President andPresident andPresident andthe representative and Representative Director
Representative
Representative Director
Representative Director
Director[Telecommunication
Design and production
department]of high-frequency
Production and construction
induction heating andof various antennas,
power supply devices;reflectors, steel towers, steel
contracted highstructures, etc.; production
Contracted highfrequency heat
Design andand construction offrequency heat
treatment processing;construction ofBusinesstelecommunication facilities treatment processing;design and production
telecommunicationand communication devices design and productionof vacuum furnaces
facilities[High-frequency department] of heating coils
and special furnaces;
Production and sales of highdesign and production
frequency induction heatingof generators,devices; contracted highswitchboards, etc.;
frequency heat treatment
design and production
processingof heating coils
Address

3-3-1 Marunouchi,
Chiyoda-ku, Tokyo

15 Ogumi, Hajodo-cho,
Kariya-shi, Aichi

Capital8,774.78 million yen

70 million yen

20 million yen

50 million yen

Date ofestablishment

June 1, 1950

April 12, 1991

February 6, 1974

July 8, 1976

DKK Co., Ltd.
100%DKK Co., Ltd.
100%

The Master Trust Bank ofJapan, Ltd.
11.9%
Nippon Life Insurance
Company
4.1%
Custody Bank of Japan
4.1%
JANUS HENDERSONHORIZON FUND
3.7%
Sumitomo Mitsui Trust Bank,
Shareholders andLimited
shareholding ratio
3.4% DKK Co., Ltd. 100%
(As of December
Sumitomo Mitsui Banking31, 2022)
Corporation
3.2%
DKK Client Stock Ownership
3.2%
MUFJ Bank, Ltd.
2.9%
OASIS JAPAN STRATEGIC
FUND LTD.
2.8%
DKK Employee Stock
Ownership
2.5%

Financial results for the recent fiscal year (ended March 31, 2022)
Fiscal period

March 31

March 31

March 31

March 31

Net assets

35,343 million yen

1,303 million yen

1,052 million yen

2,246 million yen

Total assets

42,574 million yen

1,792 million yen

1,309 million yen

2,971 million yen

Net assets pershare
Net sales

3,032.73 yen

931,058.20 yen

26,323.91 yen

449,338.13 yen

27,310 million yen

2,009 million yen

787 million yen

1,898 million yen

Operating income

139 million yen(7 million yen)

(20 million yen)

89 million yen

Ordinary income

759 million yen

1 million yen(19 million yen)

104 million yen

Net income

1,032 million yen(0 million yen)

(13 million yen)

67 million yen

Net income pershare

87.01 yen(647.22 yen)(325.32 yen)

13,428.52 yen

5.

Situation after the organizational restructuring [Overview of the surviving company in theabsorption-type merger and the succeeding company in the absorption-type split]
DKK Co., Ltd.

Denko Techno Heat Co., Ltd.

3-3-1 Marunouchi,Chiyoda-ku, Tokyo
Tadatoshi Kondo,
President and Representative Director[Telecommunication department]
Production and construction of various antennas,reflectors, steel towers, steel structures, etc.;
production and construction of telecommunication
facilities and communication devices[High-frequency department]
Production and sales of high-frequency induction
heating devices; contracted high-frequency heat
treatment processing

15 Ogumi, Hajodo-cho,
Kariya-shi, Aichi
Tsuyoshi Yamamoto,President and Representative Director

Company name
Address
Name and title ofthe representativeBusiness

Capital8,774.78 million yen

70 million yen

Fiscal period

March 31

March 31

The Master Trust Bank of Japan, Ltd.
Nippon Life Insurance Company
Custody Bank of Japan
Shareholders and JANUS HENDERSON HORIZON FUND
shareholding ratio Sumitomo Mitsui Trust Bank, Limited(As of December Sumitomo Mitsui Banking Corporation
31, 2022)
DKK Client Stock Ownership
MUFJ Bank, Ltd.
OASIS JAPAN STRATEGIC FUND LTD.
DKK Employee Stock Ownership

6.

Contracted high-frequency heat
treatment processing; design andproduction of heating coils

11.9%
4.1%
4.1%
3.7%
3.4%
3.2%
3.2%
2.9%
2.8%2.5%

DKK Co., Ltd.
100%

Future prospect

The organizational restructuring within our Group is expected to have little impact on the Company’s
consolidated financial results. If any matters that should be disclosed arise, they will be communicatedspeedily.
End[Reference material]