2013

Acquisition of Shares of Belgium-Based ARETS INTERNATIONAL NV (Reorganization into a Subsidiary)

Announced: Apr. 26, 2013

Published: Apr. 26, 2013

Name of Listed Company: TOYO INK SC HOLDINGS CO., LTD.
Listings: Tokyo Stock Exchange Code: 4634
URL: http://schd.toyoinkgroup.com
Representative: Katsumi Kitagawa, President, CEO
Contact: Toshihiko Nobe, Operating Officer, General Affairs Department
Tel: +81-3-3272-5731

Toyo Ink SC Holdings Co., Ltd. (President and Representative Director: Katsumi Kitagawa, Chuo-ku, Tokyo) (“the Company”)announced today that it signed an agreement (hereinafter “Share Purchase Agreement”) in Kingdom of Belgium on April 25, 2013 to acquire all outstanding shares of ARETS INTERNATIONAL NV, the holding company of the ARETS Group, a Belgian manufacturer of UV-cured inks (located in Niel in the Belgian province of Antwerp; hereinafter “Arets”, or “this company”) with its shareholders, specifically Next Invest NV and Fortis Private Equity Venture Belgium NV, both of which are based in Belgium. Toyo Ink SC Holdings completed the acquisition of all outstanding shares on the same day.

1. Purpose of Share Acquisition

The Toyo Ink Group has recently been focusing on globalization as its primary growth initiative.
In particular, the Group has been making an effort to further improve the global brand of ink coating material products for the market related to printing and information and packaging materials, the Group’s core products. To achieve this goal, it is pursuing growth strategies simultaneously from two angles. The first is the development of a supply chain by expanding sales and creating manufacturing bases in Asia and emerging economies, its growth area. The second is the expansion of sales of products by introducing new ways of using existing products and creating demand from product replacement with eco-friendly products in Japan and Western countries, its mature area.
The Toyo Ink Group has selected UV-cured inks^* as one of the product groups that is well positioned for the pursuit of these strategies in its endeavor to achieve a breakthrough for significant future growth. To enhance the visibility of this product group, the Group has been developing a sales network and a global supply chain that can meet demand in all areas, while taking actions to increase sales.
The Arets Group, which has become a subsidiary of the Company through the acquisition of shares, is based in Belgium and mainly manufactures and sells UV-cured inks. Based on the trust of customers that it has earned from its consistent performance, the Arets Group has established sales networks not only in Western countries, but also in a few dozen countries worldwide. It has also developed a lineup of products that can meet a diverse range of needs. The Toyo Ink Group expects that the two groups will be able to exert profound synergies.
At present, UV-cured inks are still niche products in terms of scale, but they are highly likely to lead the development of printing in the future. They will also help increase the use of products and enable the Group to enter new sectors. The Toyo Ink Group believes it needs to be able to promptly provide UV-cured inks to the market as required. By including the Arets Group in its Group through this acquisition, the Toyo Ink Group will improve the network and maximize synergies to become the No.1 brand and No.1 global manufacturer in this sector. With this initiative, the Group plans to expand the aggregate annual scale of the UV-cured inks product group from the present ¥15 billion to ¥30 billion within three years.

• * Printing with the use of ultraviolet (UV) cured inks is characterized in that the inks are instantly cured by ultraviolet radiation. It involves a shorter ink-curing time than conventional printing with oil-based inks and makes it possible to deliver printed products with a shorter lead time. While oil-based inks can only be printed on paper, UV-cured inks can be printed on synthetic paper, plastics, aluminum foil and many other materials as well.

2. Summary of Subsidiary Subject to Change (“Arets”)

(1) Corporate name	ARETS INTERNATIONAL NV (Holding company)
(2) Location	Tunnelweg 3, 2845 Niel, Belgium
(3) Title and name of representative	Managing Director, CurEX BVBA (Represented by Luc Van Doorsselaere)
(4) Business	Manufacture and sale UV inks and UV varnishes
(5) Stated capital	10,000,000 EUR
(6) Date of incorporation	June 25, 2007
(7) Major shareholders and shareholding ratio	Fortis Private Equity Venture Belgium NV 49.9% Next Invest NV 50.1%
(8) Relationship with the Company and this company	Capital Relationship	There is no capital relationship between the Company and Arets to be specified. Also there is no significant capital relationship between the affiliated persons or companies (“Affiliates”) of the Company and the Affiliates of Arets.
	Personnel Relationship	There is no personnel relationship between the Company and Arets to be specified. Also there is no significant personnel relationship with the Affiliates of the Company and the Affiliates of Arets.
	Transactional Relationship	There is no transactional relationship with the Company and Arets to be specified. Also there is no significant transactional relationship with the Affiliates of the Company and the Affiliates of Arets.
(9) Consolidated operating results and consolidated financial results for the last three (3) years unit: thousand EUR
Financial year	2010	2011	2012
Consolidated net assets	-15	-5,403	-8,195
Consolidated total assets	47,705	42,427	39,709
Consolidated net assets per share (EUR)	0	-54	-82
Consolidated sales	43,931	42,178	48,680
Consolidated operating profit	6,053	704	4,122
Consolidated profit before tax	1,096	-5,298	-1,142
Consolidated profit after tax	-1,078	-5,332	-2,423
Consolidated net income per share (EUR)	-11	-53	-24
Dividend per share	0	0	0

2. Summary of Counterparties of Share Acquisition

1)

(1) Name	Fortis Private Equity Venture Belgium NV
(2) Location	Warandeberg 3, 1000 Brussel, Belgium
(3) Grounds, etc. for incorporation	Belgian Law
(4) Purpose of incorporation	Mainly Private Equity activities
(5) Date of incorporation	April 27, 1987
(6) Total amount contributed	25,510,727 EUR
(7) Name of contributor(s), contributing ratio, summary of contributor(s)	1. Fortis Private Equity Belgium NV (99.9%) 2. BNP Paribas Fortis (1 share)
(8) Summary of managing partner(s)	Name	Fortis Private Equity Belgium NV
	Location	Warandeberg 3, 1000 Brussels, Belgium
	Title and name of representative	Luc Weverbergh Head of Private Equity
	Business	Private Equity
	Stated capital	133,000,000 EUR
(9) Relationship between the Company and this fund	Relationship between the Company and this fund	No contribution has been made by the Company or its Affiliates to this fund, directly or indirectly. There is no capital, personnel or transactional relationship requiring mention between the Company or its Affiliates, and the contributor(s) (including the initial contributor(s)) of this fund.
	Relationship between the Company and managing partner (s)	There is no capital, personnel or transactional relationships requiring mention between the Company and the managing partner of this fund. There is no capital, personnel or transactional relationship requiring mention between the Company or its Affiliates, and the managing partner of this fund or the affiliated persons or companies of the managing partner.

2)

(1) Name	Next Invest NV
(2) Location	Winterkeer 16, 1570 Galmaarden, Belgium
(3) Grounds, etc. for incorporation	Belgian Law
(4) Purpose of incorporation	Family holding
(5) Date of incorporation	August 29, 1991
(6) Total amount contributed	17,000,000 EUR
(7) Name of contributor(s), contributing ratio, summary of contributor(s)	1. Freya Holding (50% + 1 share) 2. Sadenso (50% - 1 share)
(8) Summary of managing partner(s)	Name	ILex Management NV
	Location	Galmaarden, Belgium
	Title and name of representative	Erwin De Keyser Managing Director
	Business	Consultancy, management, asset management
	Stated capital	700,000 EUR
(9) Relationship between the Company and this fund	Relationship between the Company and this fund	No contribution has been made by the Company or its Affiliates to this fund, directly or indirectly. There is no capital, personnel or transactional relationship requiring mention between the Company or its Affiliates, and the contributor(s) (including the initial contributor(s)) of this fund.
	Relationship between the Company and managing partner (s)	There is no capital, personnel or transactional relationships requiring mention between the Company and the managing partner of this fund. There is no capital, personnel or transactional relationship requiring mention between the Company or its Affiliates, and the managing partner of this fund or the affiliated persons or companies of the managing partner.

4. Number of Shares to be Acquired, Acquisition Price, and Statuses of Shares

(1) Number of shares held before the change	0 share
(2) Number of shares to be acquired	100,000 shares (number of voting rights: 100,000)
(3) Acquisition price	Ordinary share of Arets International NV 9,000 thousand EUR (Approx. 1,168 million yen) (*1) Advisory costs (estimate) Approx. 150 million yen Total (estimate) Approx. 1,318 million yen
(4) Number of shares held after the change	100,000 shares （(number of voting rights: 100,000) (share holding ratio: 100.0 %)

(*1) Date as of the date of execution of the Share Purchase Agreement.

5. Scheduled dates

(1) Date of signing contract	April 25 .2013 (Belgium Local time)
(2) Date of share acquisition	April 25 .2013 (Same as above)

6. Future Prospective

We are examining the effect to the consolidated performance of the fiscal year period ending March 2014. We will notify immediately if there is any item to be disclosed.

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Update: Apr. 26, 2013