Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Tokyo Stock Exchange  >  KDDI Corporation    9433   JP3496400007

KDDI CORPORATION

(9433)
  Report
SummaryChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

KDDI : Notice of Disposal of Treasury Stock through a Third-Party Allocation

10/30/2020 | 01:40am EST

October 30,2020

KDDI Corporation

KDDI Corporation (hereinafter, 'KDDI') hereby provides notice of a Board of Directors meeting resolution in a meeting held on October 30, 2020 concerning the disposal of treasury stock through a third-party allocation (hereinafter, 'Disposal of Treasury Stock'), as described below. KDDI concluded an agreement on a business and capital alliance (hereinafter, 'Business and Capital Alliance Agreement') with Toyota Motor Corporation (hereinafter, 'Toyota') with plans to dispose of the treasury stock by third-party allocation to Toyota.

1. Summary of the Disposal

(1) Date of disposal January 29, 2021
(2) Number of shares for disposal 18,301,600 shares
(3) Disposal price 2,853 yen per share
(4) Raised capital 52,214,464,800 yen
(5) Method of offer or disposal
(Planned disposal recipient)
All shares will be allocated to Toyota through third-party allocation.
(6) Other The above items are conditional upon the effectiveness of the registration statement filed in accordance with the Financial Instruments and Exchange Act.

2. Objective of and Reason for the Disposal

Since KDDI's founding in October 2000 through the merger of Daini Denden Inc. (DDI), KDD Corporation, and IDO Corporation, Toyota has been KDDI's second largest shareholder (with 12.95% of shares held as of September 2020). Since 2002, Toyota and KDDI have cooperated on G-BOOK and other services for the telematics business of Toyota.
In addition, prompted by the increase in internet-connected vehicles-connected cars-the two companies have been working together since 2016 to build a global communications platform independent of existing roaming services to ensure stable high-quality communications around the globe between data communications modules and cloud services. In this and other ways, the companies have been accelerating initiatives to provide safety and comfort through the integration of vehicles and communications.
The companies are also accelerating new initiatives that go beyond the borders of their core businesses of mobility and communications in anticipation of the coming future society in which towns, homes, people, and cars are all connected.
The companies will continue working to promote R&D in the areas of technologies in communications and connected cars, to develop services that enrich people's lives, and to solve social issues mainly through the use of big data.
Specifically, the companies will continue promoting the following initiatives;

Against the backdrop of the aforementioned business alliance, both companies reached the conclusion that it will be necessary to further strengthen their capital ties to promote their strategic alliance over the medium and long terms. The companies agreed to the Disposal of Treasury Stock and concluded a new Business and Capital Alliance Agreement against Toyota that includes the aforementioned business alliance to go into effect from today.

3. Amount of Funds Raised, Their Use, and Expected Payment Period

(1) Amount of Funds Raised

1 Total amount of money paid 52,214,464,800 yen
2 Estimated issuance expenses 17,000,000 yen
3 Estimated amount of cash on hand after deductions 52,197,464,800 yen

(2) Specific Use of Funds Raised

As stated above in '2. Objective of and Reason for the Disposal,' KDDI is focusing its efforts not just on its existing telecommunications business but also on areas providing services that integrate telecommunications into people's lives. Based on the business alliance with Toyota, KDDI will continue promoting businesses for automotive telecommunications and other relevant areas. In line with this plan, KDDI plans to allocate the funds raised through the Disposal of Treasury Stock to total operational funds. Moreover, until the money can be used as operational funds, KDDI plans to manage it as a bank deposit.

4. Considerations Concerning the Rational Use of Funds

Allocating the funds raised from the Disposal of Treasury Stock for the purposes listed in '3. Amount of Funds Raised, Their Use, and Expected Payment Period (2) Specific Use of Funds Raised' has been judged reasonable because it will help enhance KDDI's corporate value.

5. Rationality of Disposal Conditions

(1) Calculation Basis for the Amount of Money Paid, etc.

As a result of negotiations with the disposal side, KDDI set the amount of money paid at 2,853 yen per share. This was determined after negotiations with the disposal side that took into account various factors, including recent trends in KDDI's shares and the effect of its treasury stock acquisition policy on market supply and demand, and with reference to the average closing price of KDDI's common stock over the most recent three months and average closing price of KDDI's common stock in the most recent month.
The resulting amount of money paid conforms to the Japan Securities Dealers Association's Guidelines for the Handling of the Allocation of New Shares to a Third-Party. The amount of money paid is obtained by applying a 3.2% premium rate (rounded to nearest second decimal place, same for below) to 2,765 yen, the closing price of KDDI's common stock on the Tokyo Stock Exchange, Inc. (hereinafter, Tokyo Stock Exchange) on October 29, 2020, which is the business day preceding the Board of Directors' resolution related to the Disposal of Treasury Stock; or applying a 4.3% premium rate to 2,736 yen (decimal places truncated, same for below), which is the simple average closing price for the one-month period leading up to October 29, 2020; or applying a 3.9% discount rate to 2,970 yen, which is the simple average closing price for the three-month period leading up to October 29, 2020; or applying a 7.5% discount rate to 3,083 yen, which is the simple average closing price for the six-month period leading up to October 29, 2020. KDDI believes that the said amount does not constitute a favorable price for the planned disposal recipient for any of the periods laid out above.
We disclosed the EPS targeted in KDDI's new medium-term management plan (FY20.3-FY22.3, hereinafter, medium-term management plan) which was announced on May 15, 2019. Also we disclosed the flexible share buyback policy (hereinafter referred to as the 'Treasury Stock Acquisition Policy') described in the medium-term management plan based on this time's acquisition of treasury stock (defined later).
Based on its disclosed information, we assume that transactions are conducted in the market and KDDI's stock price is formed, and it is considered that this information has already been incorporated in the market, that the acquisition of treasury stock is planned for a certain long period of 7 months, taking into consideration the balance between supply and demand in the market, and that the total number of shares that can be acquired for the treasury stock acquisition is up to 84,000,000 shares, and the total acquisition price of stocks is up to 200 billions of yen. Therefore KDDI believes that the amount of money paid was does not constitute a favorable price for the planned disposal recipient for any of the periods laid out above. With considering that the simple average acquisition price calculated using the upper limit is lower than the latest market price.

(2) Basis for Judging the Disposal Quantity and Scale of Share Dilution to Be Rational

KDDI holds 1 share of treasury stock as of September 30, 2020 (excluding the 4,117,083 KDDI shares held by the executives' compensation BIP Trustee and the share issuing ESOP Trustee). This number of shares is not enough to correspond to the number for the planned disposition. However, as stated in the 'Notice of Decision on Matters Related to Treasury Stock Acquisition (acquisition of treasury stock based on rules in the Articles of Incorporation according to regulations of the Companies Act Article 165 Paragraph 2)' released today, the Board of Directors met on October 30, 2020, and resolved to acquire treasury stock (hereinafter, 'Treasury Stock Acquisition'). KDDI will acquire common stock, a total of up to 84,000,000 shares, for a total acquisition amount of up to 200 billion yen, over the period from November 2, 2020 to May 31, 2021 through open-market purchases on the Tokyo Stock Exchange. In light of the past acquisition of treasury stock at KDDI, the recent trading volume of KDDI's common stock, and the period of about 3 months until the payment date, KDDI is therefore expected to own enough treasury stock for the number of shares planned for the disposition by the deadline of the disposal payment.
In addition, under the Business and Capital Alliance Agreement, in the event that KDDI is unable to amass holdings of 18,301,600 shares of treasury stock, which is the number to be issued for the Disposal of Treasury Stock, by January 22, 2021, or a date separately agreed upon between KDDI and Toyota (including the confirmed number to be acquired by KDDI through a financial instruments exchange), the rules state that Toyota's application in relation to the Disposal of Treasury Stock will be for a number of shares equivalent to the number of treasury shares owned by KDDI on that day. Accordingly, regardless of the status of the treasury stock acquisition, the Disposal of Treasury Stock will not dilute shares from the date of the resolution for the disposal. In addition, KDDI plans to proceed with the medium- to long-term strategic alliance by strengthening the capital ties, and KDDI believes the Disposal of Treasury Stock is rational and will contribute to the enhancement of shareholder value.

6. Reason for the Selection of the Planned Disposal Recipient

(1) Overview of the Planned Disposal Recipient

(1) Name Toyota Motor Corporation
(2) Head office address 1 Toyota-Cho, Toyota City, Aichi
(3) Name and role of representative President and Representative Director Akio Toyoda
(4) Business Automotive, financial, and other businesses
(5) Capital 635,401,000,000 yen
(6) Date founded August 28, 1937
(7) Number of shares issued and outstanding Common Stock:
3,262,997,492 shares
First Series Model AA Class Shares:
47,100,000 shares
(8) Fiscal year-end March 31
(9) Employees (Consolidated) 359,542
(10) Main business partners -
(11) Main banks -
(12) Major shareholders and percentage ownership Japan Trustee Services Bank, Ltd.
12.71%
Toyota Industries Corporation
8.48%
The Master Trust Bank of Japan, Ltd.
7.18%
Nippon Life Insurance Company
4.53%
JPMorgan Chase Bank
(Standing proxy: Mizuho Bank, Ltd., Settlement Sales Department)
3.61%
DENSO Corporation
3.20%
State Street Bank and Trust Company
(Standing proxy: Mizuho Bank, Ltd., Settlement Sales Department)
2.79%
Mitsui Sumitomo Insurance Group Holdings, Inc.
2.02%
Trust & Custody Services Bank, Ltd.
1.82%
Tokio Marine & Nichido Fire Insurance Co., Ltd.
1.82%
(13) Relationship with KDDI
Capital relationships The number of shares of the planned disposal recipient held by KDDI: 7,994,500
(As of March 31, 2020)
Number of shares of KDDI held by the planned disposal recipient: 298,492,800
(As of March 31, 2020)
Personal relationships The planned disposal recipient has dispatched one director to KDDI.
Transactional relationships KDDI provides the planned disposal recipient with telecommunications network services in Japan and overseas, provides various solutions (including system integration) in Japan and overseas, provides IoT services (including for connected cars) in Japan and overseas, and contracts marketing for domestic mobile phone services (au retailers).
Status of relationships with related parties Not applicable.
(14) Business performance and financial condition for the last three years (US GAAP)

(Millions of yen)

Fiscal year March 31, 2018 March 31, 2019 March 31, 2020
Total net assets 19,922,076 20,565,210 21,241,851
Total assets 50,308,249 51,936,949 52,680,436
Total net assets per share (yen) 6,438.65 6,830.92 7,252.17
Operating revenue 29,379,510 30,225,681 29,929,992
Operating income 2,399,862 2,467,545 2,442,869
Ordinary income - - -
Profit attributable to owners of the parent 2,493,983 1,882,873 2,076,183
Net income per share attributable to common shareholders of the parent (yen) 842.00 650.55 735.61
Dividends per share Common stock (yen)
First Series Model AA Class Shares (yen)
220
158
220
211
220
264

(2) Reason for the Selection of the Planned Disposal Recipient

Please refer to the aforementioned '2. Objective of and Reason for the Disposal.'

(3) Holding Policy of the Planned Disposal Recipient

KDDI has verbally confirmed that Toyota's policy is to continue holding the shares acquired through the Disposal of Treasury Stock over the medium to long term.
Furthermore, KDDI plans to acquire pledges from Toyota to ensure that, in the event that the latter transfers all or part of the KDDI shares acquired through the Disposal of Treasury Stock within two years of the payment deadline, it will report the details of the action in writing to KDDI and for KDDI to report the content of said report to the Tokyo Stock Exchange and for the content of said report to be made public.

(4) Confirmed Existence of the Financial Assets Needed by the Planned Disposal Recipient for Payment

KDDI has determined that there should be no obstacle to payment by confirming that the planned disposal recipient possesses cash and cash equivalent (6,801,561 millions of yen) in an amount sufficient to pay for the Disposal of Treasury Stock with reference to the consolidated quarterly financial statement included in the first quarter earnings report provided by the planned disposal recipient to the Kanto Local Finance Bureau on August 7, 2020.

7. Principal Shareholders and Percentage of Shareholdings after Disposal

Major shareholders of the Company Ratio of controlling shares
Before disposal
(as of September 30, 2020)
After disposal
KYOCERA CORPORATION 14.54% 14.54%
Toyota Motor Corporation 12.95% 13.74%
The Master Trust Bank of Japan, Ltd. (Trust Account) 10.24% 10.24%
Custody Bank of Japan, Ltd. (Trust Account) 5.49% 5.49%
Custody Bank of Japan, Ltd. (Trust Account 7) 1.85% 1.85%
JP Morgan Securities Japan Co., Ltd. 1.60% 1.60%
Custody Bank of Japan, Ltd. (Trust Account 5) 1.29% 1.29%
Barclays Securities Japan Limited 1.25% 1.25%
JP MORGAN CHASE BANK 385781
(Standing proxy: Mizuho Bank, Ltd., Settlement Sales Department)
1.21% 1.21%
STATE STREET BANK AND TRUST COMPANY 505103
(Standing proxy: Mizuho Bank, Ltd., Settlement Sales Department)
1.20% 1.20%

8. Future Outlook

Under the Business and Capital Alliance, the companies will jointly consider new businesses, joint development, and the resolution of social issues while working to maximize corporate value over the medium and long terms. However, the impact of the Disposal of Treasury Stock on KDDI's consolidated business performance is expected to be minor.

9. Procedures within the Scope of Corporate Behavior

As this matter will have 1) a dilutive effect of less than 25% on shares and 2) does not involve a change in the controlling shareholder, procedures for the receipt of the opinion of a third-party who is independent from management and the confirmation of shareholders' intention, as provided by Rule 432 of the Tokyo Stock Exchange's Securities Listing Regulations, are not necessary.

10. Operating Performance and Status of Equity Finance for the Most Recent Three Years

(1) Consolidated Business Performance for the Last Three Years (IFRS) (Millions of yen)

Fiscal year March 31, 2018 March 31, 2019 March 31, 2020
Operating revenue 5,041,978 5,080,353 5,237,221
Operating income 962,793 1,013,729 1,025,237
Profit for the year before income tax 955,147 1,010,275 1,020,699
Profit attributable to owners of the parent 572,528 617,669 639,767
Basic earnings per share (yen) 235.54 259.10 275.69
Dividends per share (yen) 90.00 105.00 115.00
Equity attributable to owners of the parent per share (yen) 1,568.84 1,779.41 1,906.35

(2) Status of Issued Shares and Number of Dilutive Shares (As of September 30, 2020)

Shares The ratio to the number of outstanding shares
Number of shares issued and outstanding 2,304,179,550 100.0%
Number of dilutive shares at current conversion price (issue price) - -
Number of dilutive shares at lower limit of conversion price (issue price) - -
Number of dilutive shares at upper limit of conversion price (issue price) - -

(3) Recent Share Price

1) Status over the most recent three years

(Yen)
Fiscal year March 31, 2018 March 31, 2019 March 31, 2020
Opening price 2,901 2,700 2,396
High price 3,260 3,187 3,451
Low price 2,551.5 2,331.5 2,372.5
Closing price 2,716.5 2,385 3,190

2) Status over the most recent six months

(Yen)
2020
May June July August September October
Opening price 3,131 3,137 3,242 3,340 3,099 2,689.5
High price 3,283 3,258 3,372 3,368 3,099 2,837
Low price 3,041 3,116 3,163 3,063 2,604 2,640.5
Closing price 3,136 3,234 3,259 3,078 2,656 2,765

3) Share price one business day prior to disposal resolution date

(Yen)
October 29, 2020
Opening price 2,736
High price 2,781
Low price 2,725
Closing price 2,765

(4) Operating Status of Equity Finance for the Most Recent Three Years

Not applicable.

11. Summary of the Disposal

Disclaimer

KDDI Corporation published this content on 30 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 October 2020 06:39:03 UTC


© Publicnow 2020
All news about KDDI CORPORATION
01:28aJapan shares end lower on vaccine delay, caution ahead of earnings season
RE
01/08KDDI : Notice Regarding the Results of Repurchase of Own Shares
PU
2020KDDI : Telehouse America NYIIX Peering Exchange Exceeds 1 Tbps Peak Traffic
AQ
2020KDDI : Notice Regarding the Results of Repurchase of Own Shares
PU
2020Japan stocks hit 29-yr high on vaccine cheer, Biden transition
RE
2020Main events scheduled for Friday, Nov. 13
AQ
2020KDDI : Posted Performance Highlights and Q&A of the Financial Results for the Fi..
PU
2020TOYOTA MOTOR : Agreement on New Business and Capital Alliance between Toyota Mot..
AQ
2020UPDATE1 : Toyota, KDDI to enhance ties to develop connected cars
AQ
2020TOYOTA MOTOR : KDDI agree to boost business, capital alliance
AQ
More news
Financials
Sales 2021 5 246 B 50 586 M 50 586 M
Net income 2021 654 B 6 301 M 6 301 M
Net Debt 2021 969 B 9 347 M 9 347 M
P/E ratio 2021 11,6x
Yield 2021 3,65%
Capitalization 7 522 B 72 554 M 72 523 M
EV / Sales 2021 1,62x
EV / Sales 2022 1,55x
Nbr of Employees 44 952
Free-Float 70,8%
Chart KDDI CORPORATION
Duration : Period :
KDDI Corporation Technical Analysis Chart | 9433 | JP3496400007 | MarketScreener
Technical analysis trends KDDI CORPORATION
Short TermMid-TermLong Term
TrendsBullishNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 19
Average target price 3 648,61 JPY
Last Close Price 3 300,00 JPY
Spread / Highest target 45,5%
Spread / Average Target 10,6%
Spread / Lowest Target -24,2%
EPS Revisions
Managers and Directors
NameTitle
Makoto Takahashi President & Representative Director
Takashi Tanaka Chairman
Koji Sumiyoshi General Manager-Information Systems
Kazuyuki Yoshimura Director, Executive Officer & Senior GM-Technology
Takashi Shoji Representative Director & Executive Vice President
Sector and Competitors
1st jan.Capitalization (M$)
KDDI CORPORATION6.33%71 601
AT&T INC.1.22%207 410
T-MOBILE US-2.55%162 682
SOFTBANK GROUP CORP.7.52%150 274
CHINA MOBILE LIMITED6.67%124 542
NTT DOCOMO, INC.0.00%121 383