Mitsubishi Chemical : Notice on Company Split (Simplified Absorption-type Company Split) and Share Transfer in Line with Transfer of the Polycrystalline Alumina Fiber

	September 30, 2021
To whom it may concern:
Company name:	Mitsubishi Chemical Holdings Corporation
Representative:	Jean-Marc Gilson
	Representative Corporate Executive Officer,
	President & Chief Executive Officer
	Listed on the 1st section of the TSE (stock code: 4188)
Contact:	Osamu Shimizu
	General Manager,
	Corporate Communications Office
Tel:	[+81] (0)3-6748-7120

Notice on Company Split (Simplified Absorption-type Company Split) and Share Transfer in Line with Transfer of the Polycrystalline Alumina Fiber Business of the Consolidated Subsidiary (Mitsubishi Chemical Corporation)

Mitsubishi Chemical Holdings Corporation (MCHC) hereby announces that it was resolved at MCHC's Board of Directors meeting held today that (i) Mitsubishi Chemical Corporation (MCC; Head office: Chiyoda-ku, Tokyo; President: Masayuki Waga), MCHC's consolidated subsidiary, will establish a new company, MAFTEC Co., Ltd. (hereinafter, "the New Company"), to succeed MCC's polycrystalline alumina fiber business by means of an absorption-type company split (hereinafter, "the First Absorption-type Company Split"); and that (ii) Mitsubishi Chemical High-Technica Corporation (Mitsubishi Chemical High-Technica; Head office: Chiyoda-ku, Tokyo; President: Kazutaka Akai), MCC's consolidated subsidiary, will implement an absorption-type company split whereby a new subsidiary to be established by the New Company, MAFTEC Joetsu Co., Ltd. (hereinafter, "the New Company's Subsidiary"), will succeed Mitsubishi Chemical High-Technica's polycrystalline alumina fiber business (together with MCC's polycrystalline alumina fiber business, collectively, "the Business") by means of an absorption-type company split (hereinafter, "the Second Absorption-type Company Split"; and together with the First Absorption-type Company Split, collectively, "this Absorption-type Company Split"), and thereupon, MCC will transfer all shares of the New Company (hereinafter, "the Share Transfer"; and together with this Absorption- type Company Split, "this Transaction") to a special-purpose company (hereinafter, the "Apollo SPC") held by funds managed by affiliates of Apollo Global Management, Inc. (hereinafter, "Apollo") .

Various matters for disclosure and details concerning this Absorption-type Company Split have been withheld, as the First Absorption-type Company Split is a simplified absorption-type company split between MCC and the New Company, which is MCC's wholly-owned subsidiary, and the Second Absorption-type Company Split is a simplified absorption-type company split between Mitsubishi Chemical High-Technica and the New Company's Subsidiary.

The Share Transfer is conditional upon the acquisition of necessary clearance and permits under competition laws and other applicable laws in and outside Japan.

1. Purpose of This Transaction

The Business engages in the manufacturing and sales of polycrystalline alumina fiber "MAFTECTM" "MAFTECTM OBMTM " (hereinafter, "the Product") from aluminum and silicon sources. Because the Product has excellent heat resistance and stable functionality even at extremely high temperatures, it is used worldwide mainly as a holding material (support mat) to protect the ceramic catalyst carrier from vibration and impact during running in a catalytic converter to purify automobile exhaust gas and an in-furnace heat insulator for steelworks and other facilities.

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Demand for the Product has been strong due to the strengthening of automobile exhaust emission regulations in various countries and the growth of global automobile demand mainly in emerging countries in recent years, and demand is expected to continue to grow to a certain extent in the future. At the same time, there have been moves to regulate the sales of vehicles equipped with internal combustion engines, and investment in new application development and growth fields is indispensable for sustainable growth of the Business.

Under these circumstances, amid discussions on its portfolio reform based on the medium-term management plan APTSIS 25, MCHC has determined that it would be difficult to achieve reform and growth of the Business with sufficient synergies given the MCHC Group's product groups and technologies. Taking into account Apollo's wealth of experience supporting companies in advanced materials, chemicals and automotive industries as well as its specialized knowledge and management resources in the materials industry, including the aluminum industry, MCHC recently agreed to the Share Transfer to the Apollo SPC based on the belief that it would be optimal for the Business to develop new applications, including further expansion of fire and heat resistant solutions and products for industrial use and electric vehicles, and further enhance competitiveness,.

In line with its resource allocation policy, MCHC will use the funds acquired through the Share Transfer to increase its corporate value by balancing financial position improvements, growth business investments, and shareholder returns.

2. Overview of This Absorption-type Company Split

1. Summary of the First Absorption-type Company Split

1. Schedule of the First Absorption-type Company Split

Board of Directors to approve the First Absorption-type Company	January 21, 2022 (Scheduled)
Split agreement (MCC)
Parties	to conclude the First Absorption-type Company Split	January 21, 2022 (Scheduled)
agreement
First Absorption-type Company Split to take effect	March 1, 2022 (Scheduled)
Note:	As the First Absorption-type Company Split is a simplified absorption-type company split
	prescribed in Article 784, Paragraph 2 of the Companies Act for MCC, and is a simplified

absorption-type company split prescribed in Article 796, Paragraph 2 of the Companies Act for the New Company, both parties will not hold a general shareholders meeting for approval of the absorption-type company split agreement.

(ii) Method of the First Absorption-type Company Split

This will take the form of an absorption-type company split, with MCC as the splitting company and the New Company as the successor company.

(iii) Details of Share Allocation for the First Absorption-type Company Split

No shares or other consideration will be allocated in relation to the First Absorption-type Company Split.

1. Handling of Stock Acquisition Rights and Bonds with Stock Acquisition Rights as a Result of the First Absorption-type Company Split
   None.
2. Change in Capital Due to the First Absorption-type Company Split

MCHC's capital will remain unchanged as a result of the First Absorption-type Company Split.

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(vi) Rights and Obligations Assumed by the Successor Company

The New Company will assume rights and obligations including assets and liabilities pertaining to the applicable business prescribed separately in the absorption-type company split agreement as of the effective date of the First Absorption-type Company Split.

Note: The rights and obligations to be assumed by the successor company will include common shares of the New Company's Subsidiary to be delivered to Mitsubishi Chemical High-Technica as a result of the Second Absorption-type Company Split. The common shares to be delivered to Mitsubishi Chemical High-Technica will be delivered to MCC by way of a cash dividend before the First Absorption-type Company Split takes effect.

(vii) Expected Fulfillment of Obligations

It has been judged that there would be no issues regarding fulfillment of obligations to be assumed by the New Company following the effective date of the First Absorption-type Company Split.

1. Overview of the Parties Involved in the First Absorption-type Company Split (as of September 30, 2021; as of the Date of Establishment for the Successor Company)

			Splitting Company			Successor Company
(i)	Name		Mitsubishi Chemical Corporation		MAFTEC Co., Ltd. (Scheduled)
(ii)	Location		1-1 Marunouchi 1-chome,Chiyoda-ku,		To be determined
			Tokyo
(iii)	Representative		Masayuki Waga, President and		To be determined
			Representative Director
(iv)	Business		Manufacturing and sales of chemical		Manufacturing and sales of
	Description		products			polycrystalline alumina fiber
(v)	Capital Stock		53,229 million yen			1 million yen (Scheduled)
(vi)	Establishment		August 31, 1933 (Founding of the		To be determined
			original company)
			April 1, 2017 (Creation of MCC)
(vii)	Number of Shares	572,034,109			1,000 (Scheduled)
	Issued
(viii)	Fiscal Year-End		March 31			March 31 (Scheduled)
(ix)	Shareholder		Mitsubishi Chemical	100%		Mitsubishi Chemical	100%
			Holdings Corporation			Corporation
(x)	Earnings and Financial Data for the Previous Fiscal Year (FY2021/3)
	Net assets		578,758 million yen		―
			(Non-consolidated)
	Gross assets		1,414,314 million yen		―
			(Non-consolidated)
	Net assets per share		1,011.75 yen (Non-consolidated)		―
	Net sales		992,380 million yen		―
			(Non-consolidated)
	Operating income		3,835 million yen (Non-consolidated)		―
	Net income		29,376 million yen (Non-consolidated)		―
	Net income per share		51.35 yen (Non-consolidated)		―

Note: As the successor company is yet to be established, no earnings or financial data for the previous fiscal year are available.

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January 21, 2022 (Scheduled)

January 21, 2022 (Scheduled)

January 21, 2022 (Scheduled)

1. Summary of the Second Absorption-type Company Split

1. Schedule of the Second Absorption-type Company Split

Board of Directors to approve the Second Absorption-type

Company Split (Mitsubishi Chemical High-Technica)

Parties to conclude the Second Absorption-type Company Split agreement

General shareholders meeting to approve the Second Absorption- type Company Split agreement (New Company's Subsidiary)

Second Absorption-type Company Split to take effectMarch 1, 2022 (Scheduled) Note: As the Second Absorption-type Company Split is a simplified absorption-type company split

prescribed in Article 784, Paragraph 2 of the Companies Act for Mitsubishi Chemical High-Technica, the company will not hold a general shareholders meeting for approval of the absorption-type company split agreement.

(ii) Method of the Second Absorption-type Company Split

This will take the form of an absorption-type company split, with Mitsubishi Chemical High-Technica as the splitting company and the New Company's Subsidiary as the successor company.

(iii) Details of Share Allocation for the Second Absorption-type Company Split

The New Company's Subsidiary will issue 1 common share in conjunction with the Second Absorption- type Company Split, and the share will be delivered to Mitsubishi Chemical High-Technica.

1. Handling of Stock Acquisition Rights and Bonds with Stock Acquisition Rights as a Result of the Second Absorption-type Company Split
   None.
2. Change in Capital Due to the Second Absorption-type Company Split

MCHC's capital will remain unchanged as a result of the Second Absorption-type Company Split.

(vi) Rights and Obligations Assumed by the Successor Company

The New Company's Subsidiary will assume rights and obligations including assets and liabilities pertaining to the applicable business prescribed separately in the absorption-type company split agreement as of the effective date of the Second Absorption-type Company Split.

(vii) Expected Fulfillment of Obligations

It has been judged that there would be no issues regarding fulfillment of obligations to be assumed by the New Company's Subsidiary following the effective date of the Second Absorption-type Company Split.

1. Overview of the Parties Involved in the Second Absorption-type Company Split (as of September 30, 2021; as of the Date of Establishment for the Successor Company)

		Splitting Company	Successor Company
(i)	Name	Mitsubishi Chemical High-Technica	MAFTEC Joetsu Co., Ltd. (Scheduled)
		Corporation
(ii)	Location	1-1 Marunouchi 1-chome,Chiyoda-ku,	To be determined
		Tokyo
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(iii)	Representative	Kazutaka Akai, President and Director	To be determined
(iv)	Business Description	Operation and management of Joetsu,	Manufacturing of polycrystalline
		Odawara, and Mizushima Plants	alumina fiber
		Consignment of production for MCC's
		major businesses
		Real estate business in Joetsu and
		Odawara districts
(v)	Capital Stock	100 million yen		1 million yen (Scheduled)
(vi)	Establishment	February 26, 1992		To be determined
(vii)	Number of Shares	2,000		1,000 (Scheduled)
	Issued
(viii)	Fiscal Year-End	March 31		March 31 (Scheduled)
(ix)	Shareholder	Mitsubishi Chemical	100%	MAFTEC Co., Ltd.	100%
		Corporation
(x)	Earnings and Financial Data for the Previous Fiscal Year
	Net assets	575 million yen (Non-consolidated)	―
	Gross assets	3,708 million yen (Non-consolidated)	―
	Net assets per share	287,591 yen (Non-consolidated)	―
	Net sales	13,741 million yen	―
		(Non-consolidated)
	Operating income	274 million yen (Non-consolidated)	―
	Net income	260 million yen (Non-consolidated)	―
	Net income per share	129,792 yen (Non-consolidated)	―

Note: As the successor company is yet to be established, no earnings or financial data for the previous fiscal year are available.

1. Overview of the Business Domain to Be Split or to Be Succeeded as a Result of This Absorption-type Company Split

1. Business Description of the Business Domain to Be Split or to Be Succeeded

Manufacturing and sales of polycrystalline alumina fiber

(ii) Book Value of Assets and Liabilities to Be Split or to Be Succeeded (as of March 31, 2021)

	Assets				Liabilities
Item			Amount	Item			Amount
Current assets		11,936 million yen	Current liabilities		3,235	million	yen
Noncurrent asset		16,638	million	yen	Noncurrent liabilities		706 million yen
Total assets		28,575	million	yen	Total liabilities		3,941	million	yen

Note: The amounts listed above are based on the balance sheets as of March 31, 2021, and the actual amount of assets and liabilities to be split shall be the amounts obtained by adding any increase or decrease that occurred during the period until the effective date.

Note: Business performance of the department to be divided or transferred will be kept undisclosed according to the confidentiality obligation agreed upon between the parties involved.

(6) Status After This Absorption-type Company Split

The company name, location of the head office, title and name of the representative director, contents of the business, capital, and fiscal year of the parties involved will remain unchanged even after this Absorption-type Company Split. In addition, Mitsubishi Chemical Corporation will transfer all shares of the

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