Secom Joshinetsu Co., Ltd. (TSE:4342) entered into basic agreement to acquire remaining 38.3% stake in Secom Sado Co., Ltd. from Watanabe Sansho K.K., Endo Construction Co., Ltd., Ryotsu Saiseki Cooperative, and 7 individual shareholders in stock on February 8, 2017. The agreement was concluded on May 22, 2017. The consideration will be paid by issuing one share for every 68 shares of Secom Sado resulting into issuance of 0.06 million shares.

The tentative date of conclusion of the share exchange contract concerning this share exchange of both companies is mid-May 2017. Secom Joshinetsu Co., Ltd. will operate Secom Sado Co., Ltd. as wholly owned subsidiary. During the year ended March 2016, Secom Sado Co., Ltd. had net assets of ¥544 million, total assets of ¥587 million, sales of ¥242 million, and operating profit of ¥30 million.

The tentative date of corporate resolution of both companies is mid-May 2017. The tentative date of approval of the share exchange in the shareholders' meeting of Secom Sado is mid-June 2017. Board of Directors of Secom Joshinetsu Co., Ltd. made a resolution in favor of the transaction on February 8, 2017.

The tentative effective date of the share exchange is October 1, 2017. As of May 22, 2017, it was announced that the 44th ordinary general meeting of shareholders will be held on June 13, 2017 to approve the transaction. The transaction was resolved by the board of directors of Secom Sado Co., Ltd. on May 17, 2017 and was resolved by the board of directors of Secom Joshinetsu on May 22, 2017.

The expected closing date shall be July 1, 2017.