The original texts of this press release are prepared in the Japanese language, and this translation is only provisional.

 

 

 

 

 

Central Finance ブックメーカー予想サイト., Ltd.

Sumitomo ブックメーカー予想サイト Financial Group, Inc.

Sumitomo ブックメーカー予想サイト Banking Corporation

Sumitomo Mitsui Card ブックメーカー予想サイト., Ltd.

QUOQ Inc.

Mitsui & ブックメーカー予想サイト., Ltd.

 

 

 

Central Finance, Sumitomo Mitsui Financial Group and Mitsui & ブックメーカー予想サイト., Ltd. to Form Strategic ブックメーカー予想サイト in Consumer Finance ブックメーカー予想サイト

 

 

 

TOKYO, April 27,2007 --- Central Finance ブックメーカー予想サイト., Ltd. (CF, President & Representative Director: Tatsuo Tsuchikawa), Sumitomo Mitsui Financial Group, Inc. (SMFG, President: Teisuke Kitayama), Sumitomo Mitsui Banking Corporation (SMBC, President: Masayuki Oku), Sumitomo Mitsui Card ブックメーカー予想サイト., Ltd. (SMCC, President: Koichi Tsukihara), QUOQ Inc. (QUOQ, President: Shinpei Nihei) and Mitsui & ブックメーカー予想サイト., Ltd. (Mitsui, President & CEO: Shoei Utsuda) today reached an agreement to establish a comprehensive capital and business alliance for developing one another’s businesses centered on the consumer finance business.

 

 

1.  Purpose of the ブックメーカー予想サイト

 

In recent years, the ブックメーカー予想サイト environment of the consumer finance industry, including consumer installment credit and credit cards, has become increasingly severe. Consumer finance companies have been experiencing a shrinking consumer installment credit market due mainly to the spread of the use of credit cards and a rapidly changing credit card market arising chiefly from rising systems investments and heating-up of competition with companies from different industries entering the market. Furthermore, the industry is facing urgent issues such as overpayment refund claims and the revision of the upper limit on interest rates in association with the revision of the Money Lending Control Law. In addition, the momentum toward the revision of the Installment Sales Law is also growing. Under such circumstances, consumer finance companies’ most pressing need right now is to overhaul their conventional operations.

 

Meanwhile, domestic consumer spending, totaling about 300 trillion yen, is on the rise thanks to the recovering economy, and the consumer finance market is expected to grow substantially over the medium to long term. In addition, consumer needs for varied settlement and financial services are increasing, reflecting the diversification of consumers’ sense of values and lifestyles, development of IT and an expansion of new frontiers such as the small-amount settlement market. In order to strengthen their presence in the market, consumer finance companies are now required to quickly and flexibly provide financial solutions which meet the varying consumer needs.

 

With these recognitions of the current business environment, CF, SMFG, SMBC, SMCC, QUOQ and ブックメーカー予想サイト (hereinafter the “alliance partners”) today reached an agreement to enter into a strategic alliance in the consumer finance business. The alliance partners aim to provide quality products and services that accurately respond to customer needs. To this end, as strategic partners, the alliance partners will leverage this comprehensive partnership, utilize one another’s special features, know-how and experience, brands, customer base, etc., which they have developed separately in their respective businesses of “consumer installment credit,” “credit card,” “banking,” and “trade.” Through this capital and business alliance, the alliance partners will also strive to further raise the value of their businesses.

 

2.  Outline of the ブックメーカー予想サイト

 

CF, a credit company based in the Chubu region, is engaged in consumer installment credit and auto loans through its member stores, including major chain stores with nationwide networks and leading local companies. In the card ブックメーカー予想サイト, CF has issued CF cards and other wide-ranging cards under alliances with railway companies, travel agencies, oil and automobile-related companies, department stores, shopping centers, etc. Hence, CF has an abundant lineup of products and a solid customer base in the consumer finance ブックメーカー予想サイト.

 

SMCC, an SMFG group company, boasts a brand strength as one of Japan’s leading quality cards, and is actively engaged in businesses in new markets, such as small-amount settlements, and card processing on a consignment basis. QUOQ, with the largest transaction volume in the consumer installment credit industry, proactively promotes businesses, such as collection agency services using Japan’s largest network of cooperative financial institutions, and a unique, small-debt purchase program for bulk purchasing of large volume, small-lot accounts receivable and monthly tutorial fees. SMBC, with a broad customer base of about 26 million individual clients and a nationwide office and ATM networks, centered on the Tokyo Metropolitan and Kansai areas, is strong in settlement and finance services for individuals, consulting ブックメーカー予想サイト, loans to small and medium-sized companies, and providing various financial solutions.

 

ブックメーカー予想サイト is engaged in a broad range of operations both in domestic and in overseas markets, including consumer-related businesses, and is strong in providing comprehensive solutions with combined services such as marketing, financing, logistics, and risk management. Through these services, ブックメーカー予想サイト has established a strong network of influential partners and affiliates in Japan and abroad and demonstrated its comprehensive capability based on a broad customer base and deep knowledge in each ブックメーカー予想サイト domain.

 

Under the comprehensive partnership, the alliance partners will enhance, expand and develop their operational footings by capitalizing on their strength and leveraging each other’s ブックメーカー予想サイト resources. To achieve this, they will discuss and realize a broad range of ブックメーカー予想サイト alliances, including those described below. Specific details of the ブックメーカー予想サイト alliances will be deliberated at an “Alliance Promotion Committee,” which is planned to be established.

 

(1)     Outline of ブックメーカー予想サイト between CF and SMCC

-     SMCC will help CF improve products and services, including gold and platinum card services.

-     CF will use its know-how to help SMCC strengthen its personal loan ブックメーカー予想サイト

-     Both partners will cooperate with each other in the commercial card ブックメーカー予想サイト.

-     Both partners will cooperate with each other to increase merchants using their sales office networks.

-     Both partners will consider jointly operating administration and systems departments and jointly developing next-generation systems.

 

(2)     Outline of ブックメーカー予想サイト between CF and QUOQ

-     Both partners will cooperate across the board in the credit card ブックメーカー予想サイト, including providing know-how on increasing card membership and raising card utilization rate as well as mutual cooperation in establishing ブックメーカー予想サイト infrastructures.

-     Both partners will help each other in consumer installment credit and collection agency businesses.

-     QUOQ will provide CF with know-how on small-debt purchase program.

-     CF will provide QUOQ with know-how about personal loan ブックメーカー予想サイト.

 

(3)     Outline of ブックメーカー予想サイト between CF and SMBC

-     SMBC will introduce to its customers various CF products and services, including issuing of cards issued under alliances with other companies.

-     CF will introduce to its customers various SMBC products and services, including loans and settlement services.

-     SMBC will support CF in its fund raising and its use of financial services such as securitization of claims.

 

(4)     Outline of alliance between CF and ブックメーカー予想サイト

-     CF and ブックメーカー予想サイト will mutually introduce their products and services to their corporate customers and affiliated companies.

-     Both companies will consider jointly operating a credit card ブックメーカー予想サイト and a consumer installment credit ブックメーカー予想サイト overseas, centered on Asia.

-     Both companies will consider launching a new business by combining CF’s know-how of financial products and services and ブックメーカー予想サイト’s business development capability and networks.

 

Taking advantage of the alliance, SMFG and ブックメーカー予想サイト will promote collaboration in domestic and overseas consumer finance businesses by sharing their customer bases and know-how, introducing each other’s products and services, implementing personnel exchange, and mutually utilizing business resources.

 

 

3.  Outline of capital ブックメーカー予想サイト

 

In order to make the business alliance stronger and maximize its effect as well as to establish a long-term cooperative relationship, CF, SMFG, SMBC, QUOQ and ブックメーカー予想サイト will execute a capital alliance as follows.

 

(1)     Investment in CF by SMFG, SMBC and ブックメーカー予想サイト

SMFG, SMBC and ブックメーカー予想サイト plan to acquire both common shares and convertible bonds issued by CF through a third-party allocation.

SMBC intends to convert the acquired convertible bonds into common shares after CF completes all the requirements of the Banking Law and other relevant laws.

Also, ブックメーカー予想サイト may convert the acquired convertible bonds into common shares taking into consideration such factors as earnings results, business environment of CF and so on.

 

1)   Issuance of common shares by CF

i)      Number of shares to be issued: 31,638,000 shares

ii)     Aggregate amount of issue price: JPY 19,204,266,000

iii)    Company and the number of shares to be allocated:

a)      SMFG: 12,706,000 shares

(Amount to be paid: JPY 7,712,542,000)

b)     SMBC: 6,226,000 shares

(Amount to be paid: JPY 3,779,182,000)

c)     ブックメーカー予想サイト: 12,706,000 shares

(Amount to be paid: JPY 7,712,542,000)

iv)    Payment date: May 14, 2007

 

After the issuance and purchase of common shares, SMFG’s, SMBC’s and ブックメーカー予想サイト’s shares of the total voting rights of CF will be approximately 10%, approximately 5% and approximately 10%, respectively.

 

2)  Issuance of convertible bonds by CF

i)      Total amount to be issued: JPY 19,500,000,000

ii)     Company and the amount of bonds to be allocated:

a)     SMBC: JPY 7,900,000,000

b)     ブックメーカー予想サイト: JPY 11,600,000,000

iii)    Payment date: May 14, 2007

 

When all the convertible bonds are converted into common shares at the initial conversion price and combined with the common shares issued as described in 1), SMFG’s, SMBC’s and ブックメーカー予想サイト’s shares of the total voting rights of CF will be approximately 8%, approximately 12% and approximately 20%, respectively. After the acquisition, it is planned that the nominees appointed by SMFG and ブックメーカー予想サイト will become executive officers of CF.

The fund raised by CF through the capital alliance will be used for strengthening CF’s financial base, such as increasing its capital and reducing debts; as well as for making investments indispensable for the strategic ブックメーカー予想サイト development of CF, such as acquiring QUOQ’s shares to be described in (2) , which is necessary for expanding CF’s earnings base; and IT systems investment necessary for improving its operational efficiency and risk management.

 

 

(2)     Investment in QUOQ by CF

CF plans to acquire common shares of QUOQ worth JPY 7,500,000,000 through a third-party allocation.  New common shares will be issued and allocated to CF on the approval of the shareholders at the annual shareholders meeting of QUOQ.

In addition, CF and QUOQ will hold discussions on a merger by April 1, 2009, in order to maximize the synergy of the capital and ブックメーカー予想サイト alliance and to further strengthen their profitability.

 

1)  Issuance of common shares by QUOQ

i)      Number of shares to be issued: 480,000 shares

ii)     Aggregate amount of issue price: JPY 7,500,000,000

iii)    Company and the number of shares to be allocated: CF 480,000 shares

iv)    Payment date: July 2, 2007

 

After the common share issuance, QUOQ will be an equity method affiliated company of CF who will have approximately 20% share of its total voting rights. After the acquisition, nominees appointed by CF will become executive officers of QUOQ.

 

 

4. Schedule

 

April 27, 2007:                  Conclusion of capital and ブックメーカー予想サイト alliance agreement

May 8, 2007:                      Conclusion of CF shares and underwriting agreement for convertible bonds

                                            Conclusion of underwriting agreement for QUOQ shares

May 14, 2007:                    Issuance of common shares and convertible bonds by CF

June 21, 2007:                    Approval of new share issuance at the annual shareholders meeting of QUOQ

July 2, 2007:                       Issuance of common stocks by QUOQ

 

* Each procedure will be implemented in accordance with stipulations of relevant laws and regulations.

 

 

5. Earnings outlook

 

The effects of this ブックメーカー予想サイト on each company’s earnings are unclear as of April 27, 2007 and will be announced, if necessary, following the deliberation of the ブックメーカー予想サイト partners.

 

 

 

 

 

 

(Appendices)

 

 

- Overview of Central Finance ブックメーカー予想サイト., Ltd.

Corporate name	Central Finance ブックメーカー予想サイト., Ltd.
Main businesses	Credit card, consumer installment credit, personal loan, guarantee and money collection agency service
Establishment date	January 28, 1960
Location	3-20-27 Nishiki, Naka-ku, Nagoya-shi, Aichi-ken
Representative	Tatsuo Tsuchikawa, President and Representative Director
Capital	9,686 million yen (as of September 30, 2006)
Employees	2,407 (consolidated, as of September 30, 2006)
Main shareholders and their equity ratio	Japan Trustee Services Bank Ltd. (8.44%) Mitsubishi-Tokyo UFJ Bank ブックメーカー予想サイト., Ltd. (4.84%) The Chuo Mitsui Trust and Banking ブックメーカー予想サイト., Ltd. (4.83%) (as ofSeptember 30, 2006)

 

 

- Overview of Sumitomo ブックメーカー予想サイト Financial Group, Inc.

Corporate name	Sumitomo ブックメーカー予想サイト Financial Group, Inc.
Main ブックメーカー予想サイト	Management of the affairs of banking subsidiaries and of non-bank subsidiaries, and ancillary functions
Establishment date	December 2, 2002
Location	1-2 Yurakucho 1-chome, Chiyoda-ku, Tokyo
Representative	Teisuke Kitayama, President
Capital	1,420,877 million yen (as of September 30, 2006)
Employees	41,936 (consolidated, as of September 30, 2006)
Main shareholders and their equity ratios	Japan Trustee Services Bank Ltd.  (trust account) (6.06%) The Master Trust Bank of Japan, Ltd. (trust account) (5.56%) The Chase Manhattan Bank NA London (2.66%) (as ofSeptember 30, 2006)

 

 

- Overview of Sumitomo ブックメーカー予想サイト Banking Corporation

Corporate name	Sumitomo ブックメーカー予想サイト Banking Corporation
Main ブックメーカー予想サイト	Banking
Establishment date	June 6, 1996
Location	1-2 Yurakucho 1-chome, Chiyoda-ku, Tokyo
Representative	Masayuki Oku, President
Capital	664,986 million yen (as of September 30, 2006)
Employees	16,686 (non-consolidated, as of September 30, 2006)
Main shareholders and their equity ratios	Sumitomo ブックメーカー予想サイト Financial Group, Inc. (100.00%) (as ofSeptember 30, 2006)

 

- Overview of Sumitomo Mitsui Card ブックメーカー予想サイト.,Ltd.

Corporate name	Sumitomo Mitsui Card ブックメーカー予想サイト., Ltd.
Main businesses	Credit cards, loans, guarantee and gift cards
Establishment date	December 26, 1967
Location	4-5-15, Imahashi, Chuo-ku, Osaka-shi, Osaka
Representative	Koichi Tsukihara, President
Capital	34,000 million yen (as of September 30, 2006)
Employees	1,914 (non-consolidated, as of September 30, 2006)
Main shareholders and their equity ratios	Sumitomo ブックメーカー予想サイト Financial Group, Inc. (66.0%) NTT DoCoMo, Inc. (34.0%) (as ofSeptember 30, 2006)

 

 

- Overview of QUOQ Inc.

Corporate name	QUOQ Inc.
Main businesses	Consumer installment credit, personal loan, guarantee and money collection agency service
Establishment date	April 5, 1978
Location	Sumitomo Fudosan Mita Twin Buildings West Hall, 3-5-27 Mita, Minato-ku, Tokyo
Representative	Shinpei Nihei, President
Capital	1,000 million yen (as of September 30, 2006)
Employees	1,484 (non-consolidated, as of September 30, 2006)
Main shareholders and their equity ratio	Ginsen ブックメーカー予想サイト., Ltd. (21.3%) Sumitomo ブックメーカー予想サイト Banking Corporation (13.8%) Sumitomo Mitsui Card ブックメーカー予想サイト., Ltd. (10.0%) (as ofSeptember 30, 2006)

 

 

- Overview of Mitsui & ブックメーカー予想サイト., Ltd.

Corporate name	Mitsui & ブックメーカー予想サイト., Ltd.
Main ブックメーカー予想サイト	Trading company
Establishment date	July 25, 1947
Location	2-1 Otemachi 1-chome, Chiyoda-ku, Tokyo
Representative	Shoei Utsuda, President and CEO
Capital	295,797 million yen (as of September 30, 2006)
Employees	42,018 (consolidated, as of September 30, 2006)
Main shareholders and their equity ratios	The Master Trust Bank of Japan, Ltd. (trust account) (10.12%) Japan Trustee Services Bank, Ltd. (trust account) (8.9%) Mitsui Life Insurance ブックメーカー予想サイト., Ltd. (2.66%) (as ofSeptember 30, 2006)

 

 

- Overview of the ブックメーカー予想サイト alliance

 

- Overview of the capital ブックメーカー予想サイト

 

 

- Voting rights ratio in CF after completion

Allocation	After issuance of common shares		After conversion of convertible bonds
	No. of voting rights	Ratio of voting rights	No. of voting rights	Ratio of voting rights
SMFG	12,706	10.00%	12,706	7.98%
SMBC	6,226	4.90%	19,240	12.09%
ブックメーカー予想サイト	12,706	10.00%	31,816	19.99%

 

Note:     The voting rights ratio after the increase in common shares is based on the ratio as of September 30, 2006 and the following conditions:
(1)the increase in the number of voting rights (504 shares), as a consequence of Central Finance Aomori having delivered the CF shares to a third party during the period from October 1, 2006 to March 31, 2007, and;
(2)the increase in voting rights planned to be allocated to a third party this time.

The voting rights ratio after the conversion of convertible bonds is calculated based on the increase in voting rights  in the case all convertible bonds are converted at the initial conversion price.