Dexerials Corporation announced that it plans to start an integrated company on around April 1, 2024 that will lead business growth in the photonics domain, which is positioned as a growth field in the next Mid-term Management Plan commencing from fiscal year 2024. The new company will integrate the businesses and resources of domestic consolidated subsidiaries, Dexerials Precision Components Corporation, (Headquarters: Tome-shi, Miyagi; hereinafter "DXPC") and Kyoto Semiconductor Co. Ltd. (Headquarters: Shimotsuke-shi, Tochigi; hereinafter "Kyoto Semiconductor") to drive business growth in the photonics domain with the support of the entire Dexerials Group.

Dexerials will announce the details of the integrated company, including its name and representative, when they are determined. Under the Mid-term Management Plan "Challenges for Evolution," Dexerials has been taking steps to accelerate business growth in new domains, qualitatively change businesses in existing domains, and strengthen the management base to achieve sustainable growth even if the business environment changes drastically and is uncertain. As a consequence, net sales in the automotive domain exceeded 12 billion yen in the previous fiscal year, and the business portfolio transformation has been progressed.

Dexerials achieved the initial targets in the Mid-term Management Plan and the targets in the updated plan ahead of schedule. Dexerials believes it needs to continue to grow in new business domains and accelerate change in the business portfolio to achieve sustainable growth in the next Mid-term Management Plan for the period commencing from fiscal year 2024. Based on this belief, Dexerials identified the photonics as a new business domain and made Kyoto Semiconductor, which engages in the optical semiconductor business, a Group company in March 2022.

The integrated company to be set up will play a key role in driving business growth in the photonics domain. Dexerials will combine DXPC's technology to control light, which it has developed as a company engaging micro devices, particularly inorganic optical devices, with Kyoto Semiconductor's optical semiconductor technology and integrate both companies' resources. The integrated company will develop photonics solutions through combining these technologies, while continuing to evolve optical semiconductors and micro devices.

The entire Group will work as one with the integrated company at the core to achieve business growth in the photonics domain, through initiatives such as selling current products of Kyoto semiconductor to customers of Dexerials and the Dexerials products to the customers of the integrated company. The Dexerials Group aims to make the photonics business its third pillar following consumer IT and automobiles. The Group will examine the details and announce its business strategies in the next Mid-term Management Plan to be released in the next fiscal year.

Share capital: Dexerials Precision Components Corporation ? JPY 100 million; Kyoto Semiconductor Co. Ltd.: JPY 353 million.