|
Tokyo, February 8, 2005 - As part of reorganization measures being undertaken by CSK Group with the aim of creating high value-added services, CSK today announced plans to establish a new business unit providing comprehensive services to the financial sector.
In relation to this, at meetings held today of the boards of directors of CSK CORPORATION ("CSK"), Japan Future Information Technology and Systems Co., Ltd. ("JFITS"), and Financial System Service CO., Ltd. ("FSS")*1 , agreement was reached by the respective boards and contracts were signed regarding the separation and absorption of certain operations by the three companies as follows:
| (1) | The systems development operations targeting securities companies and trust banks of CSK's financial services division will be separated out and absorbed into the operations of JFITS (separation and absorption with share allocation to separating company) |
| (2) | CSK's operations relating to Market Viewer will be separated out and absorbed into the operations of FSS (separation and absorption with share allocation to separating company) |
| (3) | JFITS' operations relating to ASP (application service provider) management will be absorbed into the operations of FSS (separation and absorption with share allocation to shareholders of separating company) |
*1 JFITS and FSS are both subsidiaries of CSK I. Company separation
The new business unit is being established around FSS, a company that provides ASP services to customers of securities companies. FSS will be renamed as CSK Securities Services*2 on April 1, 2005, the day of the separation. The securities-related service functions of CSK Group will be concentrated in FSS, and the systems development operations for securities companies and trust banks will be concentrated in JFITS, with the aim of creating a structure that facilitates creativity and increases specialization within each area.
In the context of the increasingly diversified needs of investors, CSK Securities Services will seek to make maximum use of CSK Group's long-established strengths in IT, creating a wide ranging proprietary service model encompassing basic infrastructure, including market information provision and securities operations and financial service portals. The company will aim to provide a high standard of services not only to existing financial institutions but also to retail investors.
JFITS, having been repositioned as the center for systems development operations for securities companies and trust banks, will seek to further boost its experience and provide high quality services centered on securities companies and trust banks. JFITS will also play an important role developing systems and supporting the new securities-related services to be offered by CSK Securities Services.
*2 Provisional name
II. Transfer to JFITS of CSK's systems development operations for securities companies and trust banks
Under the terms of agreements signed by CSK and JFITS at board meetings held today, on April 1, 2005 CSK's systems development operations for securities companies and trust banks will be separated out and absorbed into JFITS.
- Company separation
The nature of the separation is outlined on page 1 of this document.
- Details of separation and absorption conditions, etc.
(1)Schedule
|
February 8, 2005 |
Approval from Boards of Directors of CSK and JFITS |
|
February 8, 2005 |
Agreement signed by CSK and JFITS |
|
February 22, 2005 (scheduled) |
Lodging of disclosure documents (CSK and JFITS) |
|
April 1, 2005 (scheduled) |
Date of separation |
|
April 1, 2005 (scheduled) |
Registration of separation |
|
| Note 1: |
Under Article 374, Clause 22 of the Commercial Code with respect to CSK and under Article 374, Clause 23 of the Commercial Code with respect to JFITS, this company separation and absorption will take place without seeking approval from the shareholders of the respective companies. |
| Note 2: |
Due to necessities arising from the separation process or other factors, the above schedule may change with the agreement of the parties involved. |
|
(2)Separation method and share allocation
|
A separation and absorption will take place, with CSK as the separating company and JFITS as the absorbing company. CSK will be allocated one ordinary share of JFITS. |
|
This method has been chosen because of its efficiency and ease of application compared to the operations transfer method, and also in reflection of the fact that JFITS is a wholly owned subsidiary of CSK. |
(3)Proceeds from separation
|
No proceeds from the separation will be transferred |
(4)Authorities and operations of continuing company
|
JFITS, as the absorbing company, will assume the assets and liabilities associated with and necessary to continuing the operations covered by the separation agreement, along with associated mandates, etc. contained in contracts. Liabilities will be guaranteed by JFITS. |
|
CSK's employment relationship with employees involved in the systems development operations for securities companies and trust banks being separated will not be part of the agreement. On the date of the separation it is intended to assign such employees to work in JFITS. |
(5)Debt servicing
|
Neither CSK nor JFITS are envisaged having any difficulty meeting obligations regarding liabilities associated with this company separation. |
(6)New executives of absorbing company
- Outline of companies involved (as of September 30, 2004)
| (1)Company name |
CSK CORPORATION
(separating company) |
Japan Future Information Technology and Systems Co., Ltd.
(absorbing company) |
| (2)Main business |
System integration services; Systems development and consulting; Network systems development; Applications development; Component technology and tool development; Outsourcing services; Systems related hardware sales; Training services; User support services etc. |
Specialized information systems development for securities and financial sector companies. |
| (3)Established |
October 1968 |
February 1998 |
| (4)Head office |
Minami-Aoyama 2-26-1,
Minato-ku,Tokyo |
2-4-1 Nihonbashi Hon-cho, Chuo-ku, Tokyo (As of February 8, 2005) |
| (5)Representative |
Chairman & Chief Executive Officer (CEO)
Yoshito Fukuyama |
President
Masanori Furunuma |
| (6)Paid-in capital |
¥69,410 million |
¥1,079 million |
| (7)Shares outstanding |
76,688,731 |
34,038 |
| (8)Shareholders' equity |
¥156,522 million |
¥3,132millionn |
| (9)Total assets |
¥275,835 million |
¥8,815 million |
| (10)Fiscal year end |
March 31 |
March 31 |
| (11)Number of employees |
4,467 |
371 |
| (12)Main customers |
Nissay Information Technology Co., Ltd. (others) |
Matsui Securities Co., Ltd, Mizuho Trust and Banking Co., Ltd. |
| (13)Principal shareholders and percentage held |
Japan Trustee Services Bank, Ltd. 14.89%
The Master Trust Bank of Japan, Ltd. 9.43%
OE Corporation 4.63%
|
CSK 100.00%
|
| (14)Main banks |
The Sumitomo Trust and Banking Co., Ltd. (others) |
The Bank of Tokyo-Mitsubishi, Ltd, Sumitomo Mitsui Banking Corporation, Mizuho Corporate Bank, Ltd., UFJ Bank Ltd. (others) |
| (15)Company relationship |
| Capital relationship |
(As on right) |
A consolidated subsidiary of CSK |
| Personnel relationship |
(As on right) |
Two directors are also CSK directors and, of the two auditors, one is a CSK corporate advisor and the other is also a CSK executive officer. |
| Transaction relationship |
(As on right) |
Outsourced systems development |
- Results from three previous fiscal years
| (1)CSK (separating company) |
(Unit: yen, million) |
| |
Non-consolidated |
Consolidated |
| FY ended: |
March 31,
2002 |
March 31,
2003 |
March 31,
2004 |
March 31,
2002 |
March 31,
2003 |
March 31,
2004 |
| Net sales |
127,633 |
129,346 |
146,420 |
423,703 |
357,505 |
378,472 |
| Operating income |
10,532 |
10,205 |
7,892 |
15,394 |
22,092 |
28,290 |
| Ordinary income |
9,202 |
7,091 |
10,063 |
5,410 |
16,361 |
30,565 |
| Net income (loss) |
(29,852) |
(47,757) |
18,527 |
14,220 |
10,781 |
21,424 |
| Net income (loss) per share (¥) |
(399.63) |
(649.69) |
243.03 |
190.37 |
148.25 |
283.85 |
| Dividend per share (¥) |
12.00 |
12.00 |
15.00 |
-- |
-- |
-- |
| Shareholders' equity per share (¥) |
2,027.40 |
1,281.46 |
1,614.44 |
1,269.12 |
1,237.10 |
1,702.47 |
| (2)JFITS (absorbing company) |
(Unit: yen, million) |
| |
Non-consolidated |
Consolidated |
| FY ended: |
March 31,
2002 |
March 31,
2003 |
March 31,
2004 |
March 31,
2004 |
| Net sales |
10,244 |
10,300 |
8,026 |
8,026 |
| Operating income |
670 |
746 |
(464) |
(464) |
| Ordinary income |
636 |
723 |
(487)) |
(468) |
| Net income (loss) |
634 |
1,018 |
(493) |
(474) |
| Net income (loss) per share (¥) |
19,526.28 |
30,764.11 |
(14,890.27) |
(14,319.00) |
| Dividend per share (¥) |
0 |
3,000 |
0 |
-- |
| Shareholders' equity per share (¥) |
104,197.58 |
132,973.21 |
117,859.43 |
88,027.20 |
- Business outline of operating division being separated
(1)Business contents
|
Sales and systems development operations for securities companies and trust banks |
(2)Net sales forecast of separating operations for fiscal year ending March 2005
|
Approximately ¥4.5 billion |
(3)Amount of assets/liabilities being transferred
|
Total assets |
Approximately ¥679 million |
|
Total liabilities |
Approximately ¥232 million |
|
| Note: |
The above figures are as of December 31, 2004. The actual amount of assets and liabilities separated and absorbed may change. |
|
- Business outline after separation
| (1) |
There are currently no plans to change the business operations, head offices locations or representatives of the involved companies
|
| (2) |
Impact on CSK's consolidated performance |
|
JFITS is already a consolidated subsidiary of CSK, so there will be no significant impact on consolidated results as a results of the separation. |
III. Transfer to FSS of CSK's operations relating to Market Viewer
Under the terms of agreements signed by CSK and FSS at board meetings held today, on April 1, 2005 CSK's operations relating to Market Viewer will be separated out and absorbed by FSS.
- Company separation
The nature of the separation is outlined on page 1 of this document.
- Details of separation and absorption conditions, etc.
(1)Schedule
|
February 8, 2005 |
Approval from Boards of Directors of CSK and FSS |
|
February 8, 2005 |
Agreement signed by CSK and FSS |
|
February 22, 2005 (scheduled) |
Lodging of disclosure documents (CSK and FSS) |
|
April 1, 2005 (scheduled) |
Date of separation |
|
April 1, 2005 (scheduled) |
Registration of separation |
|
| Note 1: |
Under Article 374, Clause 22 of the Commercial Code with respect to CSK and under Article 374, Clause 23 of the Commercial Code with respect to FSS, this company separation and absorption will take place without seeking approval from the shareholders of the respective companies.
|
| Note 2: |
Due to necessities arising from the separation process or other factors, the above schedule may change with the agreement of the parties involved. |
|
(2)Separation method and share allocation
|
A separation and absorption will take place, with CSK as the separating company and FSS as the absorbing company. CSK will be allocated one ordinary share of FSS.
|
|
This method has been chosen because of its efficiency and ease of application compared to the operations transfer method, and also in reflection of the fact that FSS is a wholly owned subsidiary of CSK. |
(3)Proceeds from separation
|
No proceeds from the separation will be transferred |
(4)Authorities and operations of continuing company
|
FSS, as the absorbing company, will assume the assets and liabilities associated with and necessary to continuing the operations covered by the separation agreement, along with associated mandates, etc. contained in contracts. Liabilities will be guaranteed by FSS. |
|
CSK's employment relationship with employees involved in operations relating to Market Viewer will not be part of the agreement. On the date of the separation it is intended to assign such employees to work in FSS. |
(5)Debt servicing
|
Neither CSK nor FSS are envisaged having any difficulty meeting obligations regarding liabilities associated with this company separation. |
(6)New executives of absorbing company
- Outline of companies involved (as of September 30, 2004)
| (1)Company name |
CSK CORPORATION
(separating company) |
Financial System Service
(absorbing company) |
| (2)Main business |
System integration services; Systems development and consulting; Network systems development; Applications development; Component technology and tool development; Outsourcing services; Systems related hardware sales; Training services; User support services etc. |
ASP related services for securities companies.
- Management of front, middle and back office systems for securities companies
- Securities business transfer agency services, etc. |
| (3)Established |
October 1968 |
March 2001 |
| (4)Head office |
Minami-Aoyama 2-26-1,
Minato-ku,Tokyo |
2-4-1 Nihonbashi Hon-cho, Chuo-ku, Tokyo (as of February 8, 2005) |
| (5)Representative |
Chairman & Chief Executive Officer (CEO)
Yoshito Fukuyama |
President
Masanori Furunuma |
| (6)Paid-in capital |
¥69,410 million |
¥4,400 million
(as of February 1, 2005) |
| (7)Shares outstanding |
76,688,731 |
88,000
(as of February 1, 2005) |
| (8)Shareholders' equity |
¥156,522 million |
¥3,560 million (*) |
| (9)Total assets |
¥275,835 million |
¥4,623 million (*) |
| (10)Fiscal year end |
March 31 |
March 31 |
| (11)Number of employees |
4,467 |
66 (*) |
| (12)Main customers |
Nissay Information Technology Co., Ltd. (others) |
JFITS (others) |
| (13)Principal shareholders and percentage held |
Japan Trustee Services Bank, Ltd. 14.89%
The Master Trust Bank of Japan, Ltd. 9.43%
OE Corporation 4.63%
|
CSK 100.00% (as of February 1, 2005)
|
| (14)Main banks |
The Sumitomo Trust and Banking Co., Ltd. (others) |
The Bank of Tokyo Mitsubishi,LTd., Sumitomo Mitsui Banking Corporation (others) |
| (15)Company relationship |
| Capital relationship |
(As on right) |
A consolidated subsidiary of CSK |
| Personnel relationship |
(As on right) |
-- |
| Transaction relationship |
(As on right) |
-- |
| * |
FSS was formed from the merger of TradeOne Systems Co., Ltd. ("TOS") and Financial System Services Provider Co., Ltd. ("FSSP") on February 1, 2005. Information in sections marked with an asterisk therefore reflects the combined figures of TOS and FSSP as of December 31, 2004.
|
- Results from three previous fiscal years
(1)CSK (separating company)
|
Please see figures on page 4 of this document. |
(2)FSS (absorbing company)
|
FSS was formed from the merger of TOS and FSSP on February 1, 2005. Previous results are therefore unavailable.
|
- Business outline of operating division being separated
(1)Business contents
|
ASP services providing financial market information |
(2)Net sales forecast of separating operations for fiscal year ending March 2005
|
Approximately ¥1.3 billion |
(3)Amount of assets/liabilities being transferred
|
Total assets |
Approximately ¥443 million |
|
Total liabilities |
Approximately ¥87 million |
|
| Note: |
The above figures are as of December 31, 2004. The actual amount of assets and liabilities separated and absorbed may change. |
|
- Business outline after separation
| (1) |
There are currently no plans to change the business operations, head offices locations or representatives of the involved companies
|
| (2) |
Impact on CSK's consolidated performance |
|
FSS is already a consolidated subsidiary of CSK, so there will be no significant impact on consolidated results as a result of separation. |
IV. Transfer to FSS of JFITS' operations relating to ASP management
Under the terms of agreements signed by JFITS and FSS at board meetings held today, on April 1, 2005 JFITS' operations relating to ASP (application service provider) management will be separated out and absorbed into the operations of FSS.
- Company separation
The nature of the separation is outlined on page 1 of this document.
- Details of separation and absorption conditions, etc.
(1)Schedule
|
February 8, 2005 |
Approval from Boards of Directors of JFITS and FSS |
|
February 8, 2005 |
Agreement signed by JFITS and FSS |
|
February 10, 2005 (scheduled) |
Lodging of disclosure documents (JFITS and FSS) |
|
February 25, 2005 (scheduled) |
Shareholders' meeting to ratify agreement |
|
April 1, 2005 (scheduled) |
Date of separation |
|
April 1, 2005 (scheduled) |
Registration of separation |
|
| Note 1: |
Due to necessities arising from the separation process or other factors, the above schedule may change with the agreement of the parties involved |
|
(2)Separation method and share allocation
|
A separation and absorption will take place, with JFITS as the separating company and FSS as the absorbing company. As the shareholder of JFITS, CSK will be allocated one ordinary share of FSS.
|
|
This method has been chosen because of its efficiency and ease of application compared to the operations transfer method, and also in reflection of the fact that JFITS and FSS are wholly owned subsidiaries of CSK. |
(3)Proceeds from separation
|
No proceeds from the separation will be transferred |
(4)Authorities and operations of continuing company
|
FSS, as the absorbing company, will assume the assets and liabilities associated with and necessary to continuing the operations covered by the separation agreement, along with associated mandates, etc. contained in contracts. Liabilities will be guaranteed by FSS. |
|
JFITS' employment relationship with employees involved in operations relating to ASP management will not be part of the agreement. On the date of the separation it is intended to assign such employees to work in FSS.
|
(5)Debt servicing
|
Neither JFITS nor FSS are envisaged having any difficulty meeting obligations regarding liabilities associated with this company separation. |
(6)New executives of absorbing company
- Business outline of operating division being separated
(1)Business contents
|
ASP management operations. |
(2)Net sales forecast of separating operations for fiscal year ending March 2005
|
Approximately ¥60 million |
(3)Amount of assets/liabilities being transferred
|
Total assets |
Approximately ¥560 million |
|
Total liabilities |
Approximately ¥57 million |
|
| Note: |
The above figures are as of December 31, 2004. The actual amount of assets and liabilities separated and absorbed may change. |
|
- Business outline after separation
| (1) |
There are currently no plans to change the business operations, head offices locations or representatives of the involved companies
|
| (2) |
Impact on CSK's consolidated performance |
|
JFITS and FSS are already consolidated subsidiaries of CSK, so there will be no significant impact on consolidated results as a result of separation. |
|
