May 15, 2020
To whom it may concern:

Company name:Name ofrepresentative:
Contact person:

Taiyo Nippon Sanso Corporation
Yujiro Ichihara
Representative Director, President CEO(TSE Code: 4091, First Section of the TSE)
Takayoshi Umehara
General Manager
Corporate Communications
Phone: 03-5788-8015

Notice of Absorption-Type Company Split Agreement for Transition to a Holding Company
Structure Through Company Split and Partial Amendments to Articles of Incorporation(Tradename and Business Purpose)
On January 22, 2020, Taiyo Nippon Sanso Corporation (“TNSC”) announced plans to implement atransition to a holding company structure through a company split (absorption-type split) tentatively
effective on October 1, 2020.
TNSC hereby notifies that it has resolved at its Board of Directors meeting held today to approve theabsorption-type company split agreement with a wholly owned subsidiary. (Hereinafter, the“absorption-type company split” refers to the absorption-type split in this absorption-type company
split agreement.)

Furthermore, TNSC hereby notifies that it has decided to go through with plans,

which were tentative as of January 22, 2020.
On January 22, 2020, TNSC also gave notice of its resolution to change its tradename to “Nippon
Sanso Holdings Corporation” tentatively effective on October 1, 2020, upon becoming a holding
company, along with plans to partially amend its Articles of Incorporation with regard to changing its
tradename.

In addition, TNSC plans to change its business purpose in the Articles of Incorporation toalign with its operations after transitioning to a holding company structure.
The proposed transition to a holding company structure and partial amendment to the Articles ofIncorporation will be implemented, subject to the approval of the relevant agenda at TNSC’s ordinary
general meeting of shareholders scheduled for June 19, 2020, and obtaining authorization of thecompetent authorities, as necessary.
Since the absorption-type company split entails passing along the businesses to a wholly owned
subsidiary of TNSC, some disclosures and details are being omitted from this publication.

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I.

Transition to a Holding Company Structure Through Company Split

1.

Background to, and objectives of, the transition to a holding company structure

TNSC has been solidly expanding its industrial gases business in Japan, the United States, andAsia/Oceania with the strategy to “promote globalization” under the current Ortus Stage 2 mediumterm management plan. With the addition of part of the European business of U.S. Praxair, Inc.
acquired in December 2018, TNSC group’s industrial gases business now operates under a four-hub
framework spanning Japan, the United States, Europe, and Asia/Oceania.

In order to further advance

TNSC group in the rapidly-changing global political and economic environment, TNSC sees the needto break away from its conventional domestic business-centered management framework and establish
a competitive group operation framework as a global gas major.

Accordingly, TNSC has decided to

implement a transition to a holding company structure, contemplating the following objectives.
For the post-transition structure (image), please see 6. below.
(1)

Speedier decision-making through authority delegation, and appropriate management
resource allocation
TNSC will further the authority delegation to each region and expedite its decisionmaking in order to accurately respond to the market and customer changes in therespective regions.

On the other hand, TNSC, as the holding company, will work todevise the entire group’s strategies (such as growth-oriented and appropriate
management resource allocation), ensure compliance and enhance its risk management
framework.
(2)

Greater clarity in business execution responsibilities and performance
TNSC will clarify the business execution responsibilities in each region with a fourhub business promotion framework spanning Japan, the United States, Europe, andAsia/Oceania. By changing the Japanese operation to a holding company structureand having the subsidiary succeeding to the domestic gases business specialize in thatbusiness, TNSC will work to achieve sustainable business growth, together with theother three hubs.

(3)

Enhance the group’s comprehensive capabilities by sharing regional strengths andadvantages
TNSC group has strengths in the business domains and technical fields in therespective regions.

As the holding company, TNSC will further boost the group’s

comprehensive capabilities by promoting the sharing of those regional strengths
globally.

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2.

Transition to holding company structure1)

Timetable for absorption-type company split
Board of Directors’ approval to incorporate acompany-split preparation company:

January 22, 2020

Incorporation of company-split preparationcompany:

February 4, 2020

Board of Directors’ approval of absorption-typecompany split agreement:

May 15, 2020

Execution of the absorption-type company split
agreement:

May 15, 2020

General Meeting of Shareholders’ approval of2)

absorption-type company split:

June 19, 2020 (tentative)

Date absorption-type company split takes effect:

October 1, 2020 (tentative)

Method of absorption-type company split
TNSC shall be the absorption-type splitting company, and Taiyo Nippon Sanso Split
Preparation Corporation, a wholly owned subsidiary of TNSC, shall be the succeedingcompany in the absorption-type split, which shall take over the business related to the
production and sale of TNSC’s domestic industrial gas and related devices.

3)

Allocations for absorption-type company split
Taiyo Nippon Sanso Split Preparation Corporation, the succeeding company in theabsorption-type split, shall issue 100,000 shares of common stock, all of which shall beallocated for delivery to TNSC, the absorption-type splitting company.

4)

Handling of new stock warrants and convertible bonds with new stock warrants related tothe absorption-type company split
None.

5)

Change in stated capital due to absorption-type company split
The increase in stated capital and additional paid-in capital resulting from this absorptiontype company split is as follows.

6)① Stated capital

1,475 million yen② Capital reserve

350 million yen③ Legal reserve

0 yen

Rights and obligations inherited by succeeding company in the absorption-type split
The rights and obligations inherited by succeeding company in the absorption-type split shallbe determined by the absorption-type company split agreement for the absorption-typecompany split on the date it becomes effective.
The obligations inherited by the succeeding company in the absorption-type split fromTNSC shall be determined by the concomitant assumption of the obligation method.

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7)

Outlook for fulfillment of obligations
TNSC and the succeeding company in the absorption-type split expect to have more assets
than liabilities after the absorption-type company split, and they currently do not envision
any circumstances that would impair their ability to fulfill their due obligations.
Accordingly, in the absorption-type company split, management does not foresee any
problems with the fulfillment of obligations held by TNSC and the succeeding company inthe absorption-type split.

3.

Overview of the company-split preparation company
Absorption-type splitting company

Succeeding company in absorptiontype split
Taiyo Nippon Sanso Split Preparation
Corporation
3-26 Koyama 1-chome, Shinagawaku, Tokyo
Yujiro Ichihara, Representative
Director, President(1)

TradenameTaiyo Nippon Sanso Corporation(2)

Address(3)

Representative

3-26 Koyama 1-chome, Shinagawa-ku,
TokyoYujiro Ichihara, Representative
Director, President CEO(4)

Details of
business

Manufacture and sale of industrial
gases and related devices

Manufacture and sale of industrial
gases and related devices (thecompany will not engage in any
business before the Company Split.)(5)Stated capital

37,344 million yen

25 million yen(6)Date ofincorporation
Number ofoutstanding
sharesFiscal year-end

October 30, 1910 (founding)July 19, 1918 (incorporation)
433,092,837 shares

February 4, 2020

March 31

March 31

Number of
employee
Major
shareholder andshareholding
ratio

1,471 (Non-consolidated)

3

(7)
(8)
(9)
(10)

100,000 shares

Mitsubishi Chemical Holdings
Corporation
Taiyo Nippon Sanso Client
Shareholding Society

50.59％

Taiyo Nippon Sanso Corporation:

4.19％

100%

The Master Trust Bank ofJapan, Ltd. (Trust Account)

2.84％

Japan Trustee Services Bank,
Ltd. (Trust Account)

2.58％
2.57％

JFE Steel Corporation
Meiji Yasuda Life Insurance
Company

2.31％

Mizuho Bank, Ltd.

1.89％

JP MORGAN CHASE BANK
380055 (Standing proxy:
Mizuho Bank, Ltd.’s Settlement& Clearing Services
Department)

1.84％

The Norinchukin Bank

1.62％

Japan Trustee Services Bank,
Ltd. (Trust Account 5)

0.89％

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Mizuho Bank, Ltd.
Mizuho Bank, Ltd.
CapitalThe succeeding company in the absorption-type split shall(12)
relationshipbe a wholly owned subsidiary of the splitting company.
Human resources The absorption-type splitting company shall assign two
relationshipdirectors to the succeeding company in the absorption-type
split.
Business
There is an operating agreement with TNSC related torelationshipbusiness preparations of post-integration TNSC.
(13) Financial condition and business performance in most recent fiscal year (ended March 31, 2020)
Net assets
267,929 million yen (consolidated)
47 million yen
Total assets
1,137,024 million yen (consolidated)
47 million yen
Net assets per share
618.90 yen (consolidated)
470 yen
Revenue
850,239 million yen (consolidated)—
Operating profit
93,921 million yen (consolidated)-3 million yen
Net income
55,038 million yen (consolidated)-2 million yen
Net income attributable
53,340 million yen (consolidated)－to owners of the parent
company
Net income per share123.26 yen (consolidated)-29.29 yen(Notes) 1. The absorption-type splitting company plans to change its tradename to “Nippon Sanso
Holdings Corporation” on October 1, 2020.
2. The succeeding company in the absorption-type split plans to change its tradename to“Taiyo Nippon Sanso Corporation” on October 1, 2020.

(11)

Main bankRelationships
betweencompanies[Outline of business divisions to be split off]
(1) Description of businesses to be split off

Businesses related to the manufacture and sale of domestic industrial gases and related devices(2) Business performance of division to be split off (fiscal year ended March 31, 2020)

Split-off businesses (a)TNSC’s performance (b)356,145 million yen

850,239 million yen

Revenue

Ratio (a / b)
41.9%

Operating profit
28,737 million yen
90,337 million yen
31.8%(Note) The business performance of the “Gas Business in Japan” in segment information is shown
above as the business performance of the split-off business.
(3) Assets and liabilities to be split off (as of March 21, 2020)

AssetsItem

Liabilities
AmountItem

AmountCurrent assets

96,924 million yen Current liabilities

46,175 million yen

Fixed assets

138,181 million yen Non-current liabilities

101,642 million yen

Total
235,105 million yen Total
147,817 million yen(Note) The above amounts are calculated based on the balance sheet as of March 31, 2020.
Accordingly, inherited amounts may be higher or lower than the above amounts on the date theagreement comes into effect.

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4.

Conditions after company split (as of October 1, 2020) (tentative)
Succeeding company in
Absorption-type splitting company
absorption-type split(1) Tradename
Nippon Sanso Holdings
Taiyo Nippon Sanso Corporation
Corporation(2) Address
3-26 Koyama 1-chome,3-26 Koyama 1-chome,
Shinagawa-ku, Tokyo
Shinagawa-ku, Tokyo(3) Representative
Yujiro Ichihara, Representative
Kenji Nagata, Representative
Director, President (tentative)
Director, President (tentative)(4) Details of
Operations related to subsidiary
Manufacture and sale of industrial
businessand group management
gases and related devices(5) Stated capital
37,344 million yen
15,000 million yen(6) Net assets
274,278 million yen
89,157 million yen(7) Total assets
983,201 million yen
238,933 million yen(8) Fiscal year-end
March 31
March 31
(Note) The above amounts are calculated based on the balance sheet as of March 31, 2020.
Accordingly, the actual amounts may differ from them.
5.

Future outlook

Since the succeeding company in absorption-type split shall be a wholly owned subsidiary of TNSC,
the absorption-type company split will have a negligible impact on the consolidated earnings of
TNSC.

On a parent basis, after the absorption-type company split, TNSC will become a holding

company, so its revenue will mainly consist of dividend income and management guidance fee income
from its affiliated companies.

Most expenses incurred by the holding company will likely be related

to functions for managing Group operations.

6.

Group structure after the transition to a holding company structure (image)(Before the transition) As of February 4, 2020

TNSC, primarily engaged in the domestic gases business, holds shares in the domestic and overseas group companies.
[Domestic gases business]
Taiyo Nippon Sanso Corporation

Taiyo Nippon Sanso Split Preparation
Corporation(Incorporated on February 4, 2020)

Domestic group companies[U.S. gases business] Matheson Tri-Gas, Inc. group[European gases business] Nippon Gases Euro-Holding S.L.U. group[Asia/Oceania gases business] Asia/Oceania region group companies[Thermos business] Thermos K.K. group-6-

(From October 1, 2020 (tentative))

TNSC will split its assets (including the shares in the domestic group companies, but excluding Thermos K.K.) and liabilities
related to its domestic gases business, transfer them to “Taiyo Nippon Sanso Split Preparation Corporation,” and become apure holding company.

TNSC and “Taiyo Nippon Sanso Split Preparation Corporation” will change their tradenames to“Nippon Sanso Holdings Corporation” and “Taiyo Nippon Sanso Corporation,” respectively.

[Domestic gases business] Taiyo Nippon Sanso Corporation group[U.S. gases business] Matheson Tri-Gas, Inc. group

Nippon Sanso Holdings Corporation[European gases business] Nippon Gases Euro-Holding S.L.U. group[Asia/Oceania gases business] Asia/Oceania region group companies[Thermos business] Thermos K.K. group

II.

Amendment to the Articles of Incorporation(Partial Amendments to Tradename and Business Purpose)

1.

Reason for the amendment

Subject to the Company Split taking effect, TNSC shall change its tradename provided in Article 1 of
its Articles of Incorporation to “Nippon Sanso Holdings Kabushiki Kaisha (“Nippon Sanso Holdings
Corporation” in English)” upon the transition to a holding company structure, in order to demonstratethat TNSC group is a global industrial gases group (a global gas major) originated in Japan.
Additionally, TNSC shall include business management as a holding company to its business purposein the Articles of Incorporation.
2.

Specifics of the amendment

The amendments are explained in the attachment.
3.

Timetable

June 19, 2020 (tentative)

Approval of the agenda regarding the amendment to the Articles ofIncorporation at the ordinary general meeting of shareholders

October 1, 2020 (tentative)

Amendment to the Articles of Incorporation takes effect.

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（Attachment）
Details of the amendments(Amended parts are underlined)
Current Articles of Incorporation

Proposed amendment

Article 1 (Tradename)

Article 1 (Tradename)

The name of the Company is Taiyo Nissan

The name of the Company is Nippon Sanso

Kabushiki Kaisha and is indicated in English as

Holdings Kabushiki Kaisha and is indicated in

Taiyo Nippon Sanso Corporation.

English as Nippon Sanso Holdings Corporation.

Article 2 (Purpose)

Article 2 (Purpose)

The purpose of the Company is to operate the

The purpose of the Company is to operate thefollowing businesses.

following businesses and to conduct business
management of the following companies that
operate the following businesses by holding
their shares or interests.

1 through 21 (Omitted)

1 through 21 (Unchanged)

Articles 3 through 44 (Omitted)

Articles 3 through 44 (Unchanged)
Chapter 7 Supplemental Provision
Article 45 (Interim Measure)
The changes in Article 1 and Article 2 shall beeffective on October 1, 2020 on the condition
that proposal 2 “Approval of the absorption-typecompany split agreement” submitted to the 16th
ordinary general meeting of shareholders isapproved and adopted as originally proposed
and that the absorption-type company split
under the absorption-type company split
agreement approved and adopted under that
proposal becomes effective. This supplemental
provision will be deleted on the effective date of
the changes in Article 1 and Article 2.

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