Raksul : Notice on Establishment of Joint Venture through Company Split, Transfer of Shares and Capital Increase by Third Party Allotment of the New Subsidiary

	June 10, 2022
Company name:	RAKSUL INC.
Representative:	Yasukane Matsumoto
	Representative Director, President and CEO
	(TSE Prime Market Code No. 4384)
Contact:	Yo Nagami
	Director, CFO

Notice on Establishment of a Joint Venture with Seino Holdings Co., Ltd. through a Company Split (Simplified Incorporation-type Company Split),

Transfer of Shares and Capital Increase by Third Party Allotment of the New Subsidiary

RAKSUL INC. (the "Company") resolved at the Board of Directors meeting held on June 10, 2022 to transfer the Hacobell (logistics platform) business through an incorporation-type company split (the "Company Split") to a company to be established, named HACOBELL INC. ("HACOBELL") and to transfer part of the Company's shares of HACOBELL to Seino Holdings Co., Ltd. ("SEINO HD") (the "Share Transfer"). Simultaneously, HACOBELL will issue new shares through third-party allotment (the "Third-Party Allotment") to SEINO HD, and the Company concluded an agreement on the joint venture etc., with SEINO HD dated June 10, 2022. (The "Company Split," "Share Transfer" and "Third-Party Allotment" are collectively referred to as "Transactions").

As a result of the Transactions process, HACOBELL will become an equity-method affiliate of the Company. As the Company Split will be conducted solely by the Company, some of the disclosure items and contents are omitted in this notice.

1. Reason for the Transactions
   The Company launched the Hacobell business in December 2015 and operates a platform business that increases productivity of the logistics industry and optimizes supply and demand by providing a matching platform and an operation management system.
   In addition, SEINO HD, our partner of the joint venture, has set forth in its current medium-term management plan that it will evolve into a "value-creating comprehensive logistics trading company" that contributes to solving customers' issues, and is working to build an "open public platform" by establishing a digital platform and collaborating with external resources, and to realize a smart supply chain that optimizes production, inventory, and delivery.
   In recent years, while transportation and delivery needs have continued to increase, the challenges of the supply- demand gap, including the "2024 problem" in the logistics industry caused by the shortage of truck drivers due to the labor environment and low wages, have become increasingly critical. In this environment, we believe that bringing together the strengths of both companies to co-create new value will contribute to the realization of an efficient logistics network, as well as to the resolution of issues in the logistics industry as a whole.
   By combining SEINO HD's brand, commercial logistics achievements, and customer base accumulated in the logistics industry, as well as the brand, technology, and operational capabilities that we have cultivated through our Hacobell business, we will aim to realize an "open public platform" that transcends industry and corporate boundaries to achieve "co-creation and coexistence".

1. Regarding the Company Split

1. Overview of the Company Split

1. Company Split schedule

Resolution at Board of Directors meeting approving the Company Split plan: June 10, 2022

Date of the Company Split (effective date):August 1, 2022 (scheduled)

Note: As the Company Split meets the requirements for a simplified company split in accordance with the provisions of Article 805 of the Companies Act of Japan, the Company does not require approval at the General Meeting of Shareholders.

1. Method of the Company Split
   This is an incorporation-type company split, with the Company as the splitting company and HACOBELL INC. as the newly established company.
2. Allocation of shares related to the Company Split
   The newly established HACOBELL INC. will issue 100,000 shares of common stock and allot all of the shares to the Company.

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1. Handling of share options and bonds with share options upon the Company Split Not applicable.
2. Change in capital due to the Company Split
   There will be no changes in the capital of the Company due to the Company Split.
3. Rights and obligations to be succeeded by the newly established company
   The newly established HACOBELL INC. will succeed the assets, liabilities, contractual status, and other rights and obligations with respect to the business prescribed in the incorporation-type company split plan. By assuming these obligations, HACOBELL INC. will release the original obligor from the obligations.
4. Prospects for fulfilling financial obligations
   The Company foresees no concerns in the certainty of fulfillment of financial obligations borne by the newly established HACOBELL INC. pertaining to the Company Split.

2. Outline of the splitting company and the newly established company

	Splitting company		Newly established company
	(As of June 10, 2022)		(Scheduled as of August 1, 2022)
Company name	RAKSUL INC.		HACOBELL INC.
Location	2-24-9 Kamiosaki Shinagawaku, Tokyo,	2-24-9 Kamiosaki Shinagawaku, Tokyo,
	JAPAN		JAPAN
Representative	Representative Director, President and	Representative Director and President
	CEO Yasukane Matsumoto		Kenji Hazama
Business	Printing & offline advertising platform
overview	"Raksul" and logistics platform		Logistics platform "Hacobell"
	"Hacobell"
Share capital	¥2,683 MM		¥300 MM (scheduled)
Date of	September 1, 2009		August 1, 2022 (scheduled)
establishment
Number of	29,025,400 shares		100,000 shares (scheduled)
issues shared
Fiscal year-end	July 31		March 31
Major	The Master Trust Bank of	17.65%	RAKSUL INC.	100.00%
shareholders and	Japan, Ltd. (Trust Account)
shareholding	Yasukane Matsumoto	17.18%
ratio	Custody Bank of Japan, Ltd.	6.07%
(As of April 30,	(Trust Account)
2022)	NORTHERN TRUST CO.	3.65%
	(AVFC) RE IEDU UCITS
	CLIENTS NON TREATY
	ACCOUNT 15.315 PCT
	STATE STREET BANK	2.89%
	AND TRUST COMPANY
	505303
	THE BANK OF NEW	2.67%
	YORK MELLON 140051

3. Financial position and performance of the splitting company for the last three years

(Unit: millions of yen, unless noted	Fiscal year ended	Fiscal year ended	Fiscal year ended
otherwise)	July 31, 2019	July 31, 2020	July 31, 2021
Net assets	6,809	6,801	7,996
Total assets	9,246	19,379	21,916
Net assets per share (yen)	244.88	236.73	260.02
Net sales	16,503	19,434	25,523
Operating profit	143	(244)	220
Ordinary profit	130	(368)	130
Net profit	69	(494)	160
Earnings per share (yen)	2.51	(17.64)	5.62

Note: The Revenue Recognition Accounting Standards have been applied from the beginning of the fiscal year ending July 31, 2022, and the revenue for the last three years are figures after retroactive application of the aforementioned standards.

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4. Overview of the business to be split

1. Details of the business to be split Hacobell (Logistic platform) business
2. Financial performance of the business to be split (Fiscal year ended July 31, 2021) Net sales ¥2,936 MM
   (Note: The Revenue Recognition Accounting Standards have been applied from the beginning of the fiscal year ending July 31, 2022, and the revenue for the previous fiscal year are figures after retroactive application of the aforementioned standards)
3. Items and book value of assets and liabilities to be split (as of May 31, 2022)

Assets			Liabilities
Items	Book value		Items	Book Value
Current assets	¥898	MM	Current liabilities	¥596 MM
Non-current assets	¥88	MM	Non-current liabilities	-
Total	¥986 MM	Total	¥596 MM

Note: The actual amount of assets and liabilities to be split will be settled after reflecting the changes in the amount up to the effective date of the Company Split.

5. Status of the Company after the Company Split

There will be no change in the Company's name, location, representative, business overview, share capital or fiscal year-end due to the Company Split.

III. About the Share Transfer and Third-Party Allotment

1. Outline of the counterparty to the Share Transfer and Third-Party Allotment

Company name	Seino Holdings Co., Ltd.
Location	1, Taguchi-cho, Ogaki, Gifu, JAPAN
Representative	President Yoshitaka Taguchi
Business overview	Trucking, freight forwarding, warehousing, air and sea freight forwarding agency,
	customs clearance, international intermodal transportation, etc.
Share capital	¥42,481 MM
Date of establishment	November 1, 1946
Major shareholders and	Taguchi Fukujukai Foundation		13.94%
shareholding ratio	The Master Trust Bank of Japan, Ltd. (Trust account)	10.99%
(As of March 31,	Custody Bank of Japan, Ltd. (Trust account)		7.63%
2022)	Juroku Financial Group, Inc.			3.49%
	Aioi Nissay Dowa Insurance Co., Ltd.		2.86%
	Hino Motors, Ltd.			2.33%
	The Ogaki Kyoritsu Bank, Ltd.		2.17%
	JP MORGAN CHASE BANK 385632		2.15%
	Adonis Co., Ltd.			1.76%
	Tokio Marine & Nichido Fire Insurance Co., Ltd.	1.62%
Relationship with the	Capital relationship		Not applicable.
Company	Personnel relationship		Not applicable.
	Business relationship		There are business transactions between SEINO
			HD and the Company.
	Related party status		Not applicable.
Consolidated financial	(Unit: millions of yen,		Fiscal year	Fiscal year	Fiscal year
position and	unless noted otherwise)		ended March	ended March	ended March
performance for the			2020	2021	2022
last three years	Net assets		432,813	422,634	433,520
	Total assets		654,532	672,247	685,266
	Net assets per share (yen)		2,175.29	2,297.61	2,375.05
	Net sales		625,626	592,046	607,657
	Operating profit		29,697	24,560	27,545
	Ordinary profit		31,505	27,751	30,269
	Net profit attribute to		25,848	16,660	17,255
	owners of parent
	Earnings per share		128.41	89.31	94.59
	Dividend per share (yen)		39.00	27.00	29.00

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Note: The Revenue Recognition Accounting Standards have been applied from the beginning of the fiscal year ended March 31, 2022, and the aforementioned standards have been applied for the figures for the fiscal year ended March 2022.

2. Overview of the Third-Party Allotment

Number of shares issued	42,858 shares
Total issuance amount	1,500,030,000 yen
Number of issued shares after capital	142,858 shares
increase
Allottee	Seino Holdings Co., Ltd.
Payment date	August 8, 2022 (scheduled)
Number of shares held and ratio of
voting rights held after the capital	100,000 shares (Ratio of voting rights held: 70%)
increase

3. Number of shares transferred and status of shareholding ratio before and after the Share Transfer

Number of shares held prior to the	100,000 shares (Ratio of voting rights held: 70%)
Share Transfer
Number of shares to be transferred	28,714 shares

Number of shares held and ratio of

voting rights held after the Share 71,286 shares (Ratio of voting rights held: 49.9%) Transfer

The Company does not disclose the transfer price in compliance with the non-disclosure agreement signed between the counterparty to the Share Transfer Agreement. The price has been decided upon mutual agreement after discussion and negotiations, therefore, the price is considered to be a fair and reasonable value.

4. Schedule

Date of resolution by the Board of Directors	June 10, 2022
Date of execution of the Share Purchase Agreement	June 10, 2022
Date of execution of the Share Subscription Agreement and Shareholders	August 8, 2022
Agreement	(scheduled)
Date of completion of the Share Transfer and Third-Party Allotment	August 8, 2022
(scheduled)

IV. Future Outlook

For the impact of the Transactions on the Company's business performance, please refer to "Announcement of revision of consolidated financial forecast" disclosed today.

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