TOKYO, JAPAN, 11 22, 2017
Lawson, Inc. and CVS Bay Area Inc. decided to approve two company splits at their respective Board of Directors’ meetings held on November 22, 2017. Company split No.1 would involve transferring a portion of Bay Area’s convenience store operations (91 directly operated stores and five franchise stores) to Lawson as the succeeding company. In company split No.2, the succeeding company would be a fully owned subsidiary that Lawson intends to establish called Lawson Urban Works, Inc.
This agreement is subject to the successful completion of all necessary legal procedures and actions relating to the prohibition of private monopoly and upholding of free trade.
Bay Area supports Lawson’s corporate philosophy to “Create happiness and harmony in our communities.” In January 2012, Bay Area signed a business franchise agreement with Lawson, and started operating stores under the Lawson brand from March of the same year. Since signing the agreement, Lawson and Bay Area have maintained a strong relationship as business partners. Recently, Bay Area asked Lawson if it was willing to take over the management of its convenience store operation, so that Bay Area could consolidate its business selection and focus management resources on its outstanding hotel operation and new business creation. After comprehensively investigating Bay Area’s convenience store operation management and accession scheme policy, Lawson decided to accept the proposal under the aforementioned company split format. The two companies intend to continue working together as business partners, with Bay Area continuing to operate, under the Lawson brand, the portion of its convenience store business that is not part of the company split underlying operation, and Lawson offering store-management support.
The company splits will involve approximately 160 of Bay Area’s approximately 230 employees becoming employees of the newly formed Lawson subsidiary company. In addition, the five Bay Area franchise stores that currently have a franchise agreement with Bay Area, will be expected to sign a new franchise agreement with Lawson on the effective date of the company split.
Board meeting to approve company split No.1 and No2 (Lawson) | November 22, 2017 |
Board meeting to approve company split No.1 and No2 (Bay Area) | November 22, 2017 |
Registration of new Lawson subsidiary company | November, 2017 (tentative) |
Signing of company split basic agreement (operational transfer) | November 2017 (tentative) |
Signing of company split agreements | December 2017 (tentative) |
Date company splits come into effect | March 1, 2018 (tentative) |
Payment date | March 1, 2018 (tentative) |
Succeeding company 1 | Succeeding company 2 | Split company | |
---|---|---|---|
(1)Company | Lawson, Inc. | Lawson Urban Works, Inc. | CVS Bay Area Inc. |
(2)Business location | East Tower, Gate City Osaki, 1-11-2 Osaki, Shinagawa, Tokyo | East Tower, Gate City Osaki, 1-11-2 Osaki, Shinagawa, Tokyo | 1-9-2 Mihama, Urayasu, Chiba Prefecture |
(3)Name and title of representative director | Sadanomu Takemasu President and CEO, Representative Director, Chairman of the Board |
Tatsuya Takamori President and CEO |
Tomihiko Kamiyama President and CEO |
(4)Main areas of business operation | Convenience store operations | Convenience store operations | “Lawson” convenience store operations, business hotel / smart hotel operations |
(5)Capital | 58,506 million yen | 10 million yen (tentative) | 1,200 million yen |
(6)Established | April 15, 1975 | November 2017 (tentative) | February 1981 |
(7)Shares issued | 100,300,000 shares | 1,000 shares | 5,064,000 shares |
(8)Business year end | End of February | End of February | End of February |
(9)Number of employees | 8,377 (consolidated) | 237 (non-consolidated) | |
(10)Major customers | Mitsubishi Shokuhin Co., Ltd. | Lawson, Inc. | |
(11)Main bank | Bank of Tokyo-Mitsubishi UFJ, Ltd. | Sumitomo Mitsui Banking Corporation The Keiyo Bank, Ltd. |
|
(12)Major shareholders and shareholdings ratio | Mitsubishi Corporation 50.1% |
Lawson, Inc. 100.0% |
YUNEISIA CO., LTD 26.5% |
(13)Relationship between listed companies and companies concerned | Capital | Lawson subsidiary fully owned by Lawson, Inc. | None |
Personal | None | ||
Business | None | ||
Pertinent information on relationship with related parties | None | ||
(14)Three-year overview of Lawson consolidated financial results (millions of yen) | |||
Financial year end | February 28, 2015 | February 29, 2016 | February 28, 2017 |
Net assets | 263,797 | 272,997 | 285,995 |
Total assets | 764,614 | 803,212 | 866,577 |
Net assets per share (yen) | 2,561.25 | 2,643.97 | 2,748.39 |
Gross operating revenue | 497,913 | 583,452 | 631,288 |
Operating profit | 70,482 | 72,541 | 73,772 |
Recurring profit | 71,714 | 69,622 | 73,014 |
Net profit | 32,686 | 31,381 | 36,400 |
Net earnings per share (yen) | 327.08 | 313.81 | 363.96 |
(15)Three-year overview of Bay Area consolidated financial results (millions of yen) | |||
Financial year end | February 28, 2015 | February 29, 2016 | February 28, 2017 |
Net assets | 2,014 | 2,172 | 2,193 |
Total assets | 10,801 | 12,647 | 12,817 |
Net assets per share (yen) | 40.82 | 440.13 | 444.37 |
Gross operating revenue | 28,726 | 29,193 | 29,452 |
Operating profit | 230 | 151 | -33 |
Recurring profit | 278 | 145 | 213 |
Net profit | 225 | 198 | 94 |
Net earnings per share (yen) | 4.56 | 44.22 | 19.13 |
Assets | Liabilities | ||
Type | Book value | Type | Book value |
Cash and deposits | 39 | Advance receipts | 70 |
Inventory assets | 390 | Accrued bonuses | 49 |
Other current assets | 70 | Accrued pension costs | 89 |
Tangible fixed assets | 94 | Asset retirement obligations | 233 |
Intangible assets | 3 | ||
Investments & other assets | 636 | ||
Total | 1,235 | Total | 441 |
There will be no change to Lawson’s trading name, business location, representative director name and status, business operations, capital or financial year end.
None
Any impact on Lawson’s consolidated business performance from company split’s 1 and 2 are expected to be minimal.