Japan Exchange Group, Inc. (TSE:8697) entered into a basic agreement to acquire Tokyo Commodity Exchange, Inc. from a group of sellers on March 28, 2019. Japan Exchange Group, Inc. entered into the business combination agreement to acquire Tokyo Commodity Exchange, Inc. for ¥5.5 billion on July 30, 2019. Japan Exchange Group will acquire 3.1 million shares at ¥487 per share. Japan Exchange Group, Inc. is considering to conduct a tender offer to convert Tokyo Commodity Exchange, Inc. into a wholly-owned subsidiary.

In the event, Japan Exchange Group, Inc. fails to acquire all of Tokyo Commodity Exchange, Inc. shares, Japan Exchange Group, Inc. will conduct a demand for share, etc. cash-out and a series of other procedures based on the Companies Act to make JPX the sole shareholder of Tokyo Commodity Exchange, Inc. For the year ended March 31, 2018, Tokyo Commodity Exchange, Inc. reported total assets of ¥136.1 billion, revenue of ¥3.1 billion, operating loss of ¥792 million and net loss of ¥727 million. The transaction is subject to the necessary approvals of the related regulatory authorities and minimum number of shares tendered should be 2.1 million. Board of Directors of Japan Exchange Group, Inc. approved the transaction on July 30, 2019. The Board of Directors of Tokyo Commodity Exchange, Inc. recommended the shareholder to tender their shares on July 30, 2019. The conclusion of final agreement and tender offer will commence in end of June 2019 and the tender offer will close in September 2019. As of June 28, 2019, the conclusion of final agreement and tender offer were postponed and will be decided later. As of August 1, 2019, Board of Directors of Tokyo Commodity Exchange, Inc. has expressed its opinion in favor of the transaction and encourages all shareholders to accept the offer. The closing of tender offer remains unchanged and will close in September 2019. Tender offer will open from August 1, 2019 and will close on September 24, 2019.

TMI Associates acted as legal adviser and Goldman Sachs Japan Co., Ltd. acted as financial adviser and Mizuho Securities Co., Ltd. acted as tender offer agent for Tokyo Commodity Exchange. Daiwa Securities Co, Ltd acted as independent financial advisor for Japan Exchange Group Inc to obtain advice on the consideration of the transaction and other supports towards realization of the transaction. Nagashima Ohno & Tsunematsu acted as financial advisor to Goldman Sachs Japan Co., Ltd. Nomura Securities acted the financial advisor to Japan Exchange.