Leopalace21 : Notice Concerning Transferring Equity Interest in a Subsidiary

FOR IMMEDIATE RELEASE

January 18, 2021

Company Name:	Leopalace21 Corporation
Representative:	Bunya Miyao, President and CEO
Code Number:	8848 (Tokyo Stock Exchange, First Section)
Contact:	Shinji Takekura, Senior Department Manager
	Tel: [phone]
	E-mail: [e-mail]

Notice Concerning Transferring Equity Interest in a Subsidiary

Leopalace21 Corporation (Headquarters: Nakano, Tokyo; President and CEO: Bunya Miyao; the "Company") announces that the Company determined to transfer the whole equity interest in LEOPALACE21 VIETNAM CO., LTD. ("Leopalace21 Vietnam") a subsidiary of the Company to Chuwa Petroleum Co., Ltd. ("Chuwa Petroleum") as follows. As a result of the equity interest transfer, Leopalace21 Vietnam will be excluded from the scope of consolidation of the Company.

1. Reason for transfer of equity interest

Leopalace21 Vietnam became a consolidated subsidiary of the Company on November 4, 2013. Since then, Leopalace21 Vietnam has been mainly responsible for the real estate agency business in addition to real estate management, management of serviced apartments and serviced offices as well as real estate development business.

The Company has been looking for a purchaser both in and outside of Japan in line with the policy of transferring or withdrawing from non-core and unprofitable businesses for drastically improve the financial base for increased corporate value, which we announced in the Notice Concerning Implementing Structural Reforms based on Strategic Review Results for Drastic Business Strategies Reconstruction dated on June 5, 2020. The Company determined to transfer the whole equity interest in Leopalace21 Vietnam to Chuwa Petroleum.

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2. Outline of the subsidiary to be transferred

(1)	Name	LEOPALACE21 VIETNAM CO., LTD.
(2)	Address	25F Lim Tower, 9-11 Ton Due Thang Street, Ben Nghe
		Ward, District 1, HCMC, Vietnam
(3)	Representative	Hidenobu Sato, Representative Director
(4)	Business description	Real estate agency business and management business,
		Management of serviced apartments and serviced offices,
		and Real estate development business
(5)	Founded	November 2013
(6)	Capital	95,075 million VND*
(7)	Major equity interest	Leopalace21 Corporation	100%
	holder and holding
	ratio
(8)	Relationship between	In terms of capital:	The Company owns 100% equity
	the Company and		interest in Leopalace21 Vietnam.
	Leopalace21 Vietnam
	In terms of personnel:	The Company sends one
			representative director and one
			employee on secondment.
		In terms of business:	The Company has business
			relationship with Leopalace21
			Vietnam in referral of customers
			and transaction.

*The value is stated in the company registration certificate and different from the one stated in the audit report, which is 96,707 million VND.

3. Outline of the transferee of the equity interest in Leopalace21 Vietnam

(1)	Name	Chuwa Petroleum Co., Ltd.
(2)	Address	9-1008 Minami 4-jo Nishi, Chuo-ku, Sapporo City,
		Hokkaido
(3)	Representative	Kenjiro Sugisawa, Representative Director
(4)	Business description	Energy business centered on gas stations operation,
		Sale of new and used cars and maintenance services
		business,
		Real estate business for commercial properties and rental
		apartments, and
		Human resource services business specialized in
		Vietnamese
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(5)	Founded	December 1954
(6)	Capital	48 million yen
(7)	Major shareholders	Kenjiro Sugisawa	65.9%
	and shareholding ratio	Sugi Corporation	16.0%
		Koutaro Sugisawa	5.5%
		Hiroshi Sugisawa	2.9%
(8)	Relationship between	In terms of capital:	None
	the Company and
	In terms of personnel:	None
	Chuwa Petroleum
	In terms of business:	None

4. Amount of equity interest transferred, value of the transfer and interest holding before and after the transfer

(1)	Amount of owned equity	95,075,000,000 VND
	interest before the
	transfer
(2)	Amount of owned equity	95,075,000,000 VND
	interest to transfer
(3)	Value of the transfer	Due to confidential liability between the parties, the
		value of the transfer is not disclosed. The value is
		however determined by negotiations with the
		counterpart through a fair process.
(4)	Amount of owned equity	None
	interest after the transfer
5.	Time schedule
(1)	Date of concluding the	January 15, 2021
	equity interest transfer
	agreement
(2)	Effective date of equity	April 1, 2021 (planned)
	interest transfer

6. Future Outlook

We do not believe the impact of this matter on our earnings forecast for the year ending

March 2021 is material enough although it works to reduce the consolidated operating loss since Leopalace21 Vietnam has been continuing to record a deficit. We will promptly disclose any issues that need to be published due to further development.

END

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