[FAQ] Frequently Asked Questions on the Planned MBO

What is the “planned management buyout (MBO)?”

- As part of what is known as a management buyout (MBO), it is anticipated that tender offer (hereinafter, the “Tender Offer”) for the common shares issued by our company will be made by K.K. BCJ-78, which is owned by funds affiliated with Bain Capital Private Equity, LP (hereinafter, "Bain Capital"). Please note that the Tender Offer is expected to commence promptly upon the fulfillment of certain conditions, including the completion of the procedures and actions required under Japanese and foreign competition laws and regulations, which may require a certain period of time for processing and handling.
- In response to this, we passed a resolution to state an opinion in favor of the Tender Offer and to recommend that Company’s shareholders tender their shares in the Tender Offer when the Tender Offer commences, as the current opinion of the Company based on present circumstances.

What is a management buyout (MBO)?

A management buyout (MBO) generally refers to a transaction in which the management team of the target company (the company that will be acquired) raises all or part of the funds necessary for the acquisition and then purchases the shares of the target company on the assumption that the business of the target company will be continued.

What is the Tender Offer price?

The Tender Offer price will be JPY 1,755 per common share.

What will happen to the dividends and Shareholder Benefit Program?

At the Board of Directors meeting held on December 8, 2023, we passed a resolution to not distribute any dividend from surplus for the record date of December 31, 2023, and to abolish the shareholder benefit program in light of the tender offer.

When does the Tender Offer start?

The Tender Offeror aims to commence the Tender Offer by late January 2024; however, because it is difficult to accurately predict the time required for procedures, etc. at the relevant domestic and international authorities, it will announce the details of the schedule for the Tender Offer as soon as they are determined. It will also promptly make an announcement if the expected time of commencement of the Tender Offer is changed.

Why did you agree to a management buyout (MBO)?

- Bain Capital has determined that, if we go private and become released from the stock market pressure to improve short-term profits, our corporate value may be improved from a medium- to long-term perspective through acceleration of organic growth, establishment of a global network for human resources mobility, improvement of management efficiency by strengthening global internal control, and acceleration of PMI and maximization of synergies after M&A. Furthermore, we believe that in addition to our own management efforts, by utilizing outside management resources, which has the know-how for group restructuring and improving internal management systems and governance systems based on its past investment cases, it will be possible to accelerate the radical restructuring of the internal management system and global governance system, which is our urgent challenge.
- This is expected to improve our corporate value over the long term through improved management efficiency, as well as enable management resources such as listing maintenance costs and auditing resources to be allocated to business investment.
- In terms of the transaction conditions, including the Tender Offer Price, we have determined that the results of the stock valuation by our third-party valuation institution, as well as the fair value opinions of the Special Committee's third-party valuation institution, the premium level to the market stock price, fairness protection measures taken by our company, the negotiation process with Bain Capital, and other relevant factors, are reasonable for all our shareholders. We believe that this Tender Offer provides a reasonable opportunity for our shareholders to sell their shares.
- For details, please refer to the "Notice Regarding Opinion in Favor of Planned Management Buyout and Recommendation to Tender Shares" dated December 8, 2023.

What procedures are necessary for applying for the Tender Offer?

- For detailed application procedures, please refer to the tender offer registration statement that will be separately disclosed at the time of the start of the Tender Offer.
- We would like to kindly request you to confirm with a tax accountant or other professional concerning the tax handling of tendering your shares in the Tender Offer.

Will there be any fees for applying for the Tender Offer?

For detailed application procedures, please refer to the tender offer registration statement that will be separately disclosed at the time of the start of the Tender Offer.

What will happen to my shares if I don’t apply for the Tender Offer?

- If the Tender Offer is successful and the Tender Offeror cannot acquire all of our company's shares, it is anticipated that procedures for a squeeze-out, with only the Tender Offeror as our company's shareholder, will be implemented to privatize our company's shares.
- It is planned that ultimately cash will be delivered to the shareholders who did not tender their shares to the Tender Offer.
- In that case, the amount of cash to be delivered to each shareholder is planned to be calculated by multiplying the Tender Offer Price by the number of the shares held by each shareholder.

- I am trying to call OUTSOURCING Inc., but I cannot reach the company. What should I do?
    - I am waiting for a call back, but I have not received a call yet. What should I do?

We sincerely apologize that we have not been able to promptly respond to all inquiries. We will respond in the order the call is received. Thank you for your understanding and cooperation.

For other inquiries, please click here.

All