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Press Room

September 22, 2014
Mitsubishi Corporation

Mitsubishi Corporation Commences Recommended Voluntary Cash Tender Offer to Acquire 100% Shares of Cermaq ASA

Mitsubishi Corporation (MC) has launched a voluntary cash tender Offer for 100% of shares in Cermaq ASA. Cermaq’s Board supports the Offer.
 
A unanimous decision was made by Cermaq’s Board of Directors to recommend the Offer.
MC has informed the Norwegian State as a shareholder about the Offer, and understands that the Ministry of Trade, Industry and Fisheries (which holds 59.17% of the total outstanding shares) will comment on the Offer in a separate statement.  
 
MC’s main objectives for acquiring Cermaq;
MC provides products and services, develops businesses, and invests in various fields that directly impact our quality of life. Our strength is that we conduct a well-balanced business throughout our value chains, extending from the upstream sourcing of resources to the downstream retail and food service businesses.
Within the seafood business, MC has established a strong position as a leader in Japan, especially for salmon, shrimp and tuna. MC has strong value chain in Japan through subsidiary companies.
Cermaq is the third largest salmon farming company in the world, with operations in Chile, Canada and Norway, and produces about 170 thousand metric tons (WFE) of salmon per year. Through the Offer, MC will combine the production know-how, business foundation accumulated in the food sector with Cermaq’s scale and sector expertise to expand globally in the seafood business and, in so doing, contribute to securing a safe and sustainable food supply network.
New Strategic Direction, MC’s corporate strategy released in 2013, set out as part of its long-term growth vision circa 2020 to double earnings in non-resource businesses. The aim of the Living Essentials Business Group is to provide a stable supply of food products to consumers and to expand the company’s earnings base by strengthening functions at each stage of the supply chain. The Business Group will continue to develop the vertically integrated business model, particularly as it relates to daily living essentials in the food, clothing and housing sectors.
 
1.    Outline of Cermaq
(1) Outline
Company Name
Cermaq ASA
Registered Office
Dronning Eufemias gate 16. P.O.Box 144, Sentrum N-0102 OSLO, Norway
Representative
Chief Executive Officer, Jon Hindar
Main Business
Salmon farming, processing and marketing
Issued Share Capital
Norwegian Krone (”NOK”) 925 million (as of June, 2014)
Establishment
1995
Number of Shares Outstanding
92,500,000(as of June, 2014)
Fiscal Year End
December
Number of Employees
4,361 (as of December, 2013)
 
(2) Trend in financial results in recent fiscal years
 
Six months
ended 30 June
 
 
 
NOK1 000
2014**
2013***
2012****
2011*
Operating revenue
2 621 800
5 155 315 
3 280 605
11 634 344
Operating profit (loss) before fair value
adjustments of biological assets
492 600
542 117
-196 705
1 368 526
Profit (loss) from operations
326 000
1 193 699 
-403 905
1 006 570
Net profit (loss) before tax
280 500
1 164 997
 -407 591
1 004 696
Total Assets
9276 500
13 796 262
12 087 035
10 357 316
Cash
350 500
4 732 063
510 181
459 263
Total equity
4924 900
9 624 913 
5 678 644
6 159 019
Total liabilities
4351 600
4 171 349
6 408 391
4 198 297
* Based on the audited consolidated financial statements; figures include EWOS (feed business)
** Extracted from unaudited quarterly results
*** Pro-forma P&L numbers for continued operations (excluding external income and expenses relating to EWOS. (Please refer to note 5 in the Cermaq's annual report for 2013 for further information)
**** Restated numbers to provide comparable numbers in relation to *** above (Please refer to note 5 in the Cermaq's annual report for 2013 for further information).
 
2.    Outline of the Offer
(1) Offeror in the Offer
MC Ocean Holdings Limited, a UK-based private limited company 100% owned by MC.
 
(2) Company Subject to the Offer
Cermaq ASA
 
(3) Schedule of the Offer
Acceptance period from and including September 22, 2014 to and including October 20, 2014. (subject to extension) The terms and conditions of the Offer are set out in the offer document for the Offer dated September 22, 2014.
 
(4) Offer Price
NOK 96 (Ninety Six) per Share
(Approximately JPY1,646 per Share, assuming NOK 1 = JPY17.15)
The Offer represents a premium of 14.3% over the closing price of the Shares on 19th September, 2014 and a premium of 18.3% and 27.7% over the average volume weighted share price during the last three and six months.
 
(5) Number of Target Shares in the Offer
Target Shares: Ordinary Shares 92,500,000 Shares (of which Cermaq holds 3,656 Shares)
 
(6) Capital Required for the Offer
Approximately NOK 8,880 million (Approximately JPY152,292 million)
 
(7) Minimum number of shares tendered
The Offer is (among other things) subject to the condition that the receipt of valid acceptances is more than 90% of the issued and outstanding share capital and voting rights of Cermaq on a fully diluted basis (unless waived by the Offer in its sole discretion).
 
(8) Change in the Shareholding of the Offeror in Cermaq by the Offer
The Number of Shares before the Offer: 0 Shares
Estimated Number of Shares after the Offer: 92,500,000 Shares *
Note 1) This number is based on the situation where the Offeror is able to acquire 100% of the Company‘s Shares.
Note 2) If the Offeror acquires 90% or more of the Company’s total Shares Outstanding and voting rights, the Offeror intends to carry out a compulsory acquisition of the remaining Shares in accordance with Norwegian law to make Cermaq a wholly-owned subsidiary.  
 
3.    Outlook
The details and results of the Offer will be reported after the completion of the Offer.
 
4.    Financial Impact
The details of financial impacts will be reviewed once it becomes clear after the completion of the Offer.
 
5.    Advisor of the Offer
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., operating in Norway through its affiliate Morgan Stanley & Co. International plc, is acting as financial advisor. Advokatfirmaet BA-HR DA is acting as Norwegian legal advisor.
 
 
Notice to US Holders
The Offer will be made in the United States pursuant to an exemption from certain requirements of the United States federal tender offer rules as provided by Rule 14d-1(c) under the United States Securities Exchange Act of 1934, as amended (the "Exchange Act") and is subject only to certain provisions of Section 14(e) and Regulation 14E thereunder and certain other applicable laws. The Offer will be made for the securities of a Norwegian company whose shares are listed on the Oslo Stock Exchange and is subject to Norwegian disclosure requirements, which are different from those of the United States. Accordingly, the Offer will be subject to disclosure and other procedural requirements, including with respect to withdrawal rights, offer timetable, settlement procedures and timing of payments that may be different from those applicable under United States domestic tender offer procedures and law.
The receipt of cash pursuant to the Offer by a US shareholder may be a taxable transaction for US federal income tax purposes and under applicable US state and local, as well as foreign and other tax laws. Each shareholder is urged to consult his independent professional adviser immediately regarding the tax consequences of acceptance of the Offer.
It may be difficult for US shareholders to enforce their rights and any claim arising out of the US federal securities laws, since the Offeror is located in a non-US country, and some or all of its officers and directors may be residents of a non-US country. US shareholders may not be able to sue a non-US company or its officers or directors in a non-US court for violations of the US securities laws. Further, although US holders are not waiving their rights under US federal laws by accepting the Offer it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court’s judgment.
In accordance with ordinary Norway practice and pursuant to Rule 14e−5(b) of the Securities Exchange Act of 1934, the Offeror or its nominees or brokers (acting as agents) may from time to time make certain purchases of, or arrangements to purchase, Shares outside the United States, other than pursuant to the Offer, before or during the period in which the Offer remains open for acceptance. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Such purchases or arrangements to purchase Shares must comply with Norwegian law and other applicable law. Any information about such purchases will be disclosed as required in Norway and will be available via the online information system of Oslo Stock Exchange (www.newsweb.no).
 
Forward-Looking Statements
This press release contains a number of forward-looking statements. Words, and variations of words, such as "will," "intend," "expect," and similar expressions are intended to identify forward-looking statements, including those regarding the expected timing and terms of the Offer. These statements speak only as of the date of this press release and are based on the Offeror's current plans and expectations, and they involve risks and uncertainties that could cause actual future events or results to be different than those described in or implied by such forward-looking statements. These risks and uncertainties include those relating to changes in financial markets, economic, political or regulatory conditions or other trends affecting the global fish farming, food and consumer products industries and other industries in which Mars and the Company operate, and changes in facts and circumstances and other uncertainties concerning the completion of the tender offer. Further information about these matters can be found in the offer document and in other public filings of Mars and the Company available via the online information system of Oslo Stock Exchange (www.newsweb.no). Except as required by applicable law or regulation, Mars and the Company do not undertake any obligation to update forward-looking statements to reflect future events or circumstances.
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., operating in Norway through its affiliate Morgan Stanley & Co. International plc, (collectively, “Morgan Stanley”), is acting as lead financial advisor to MC and the Offeror and no one else in connection with the matters described in this announcement. In connection with such matters, Morgan Stanley, its affiliates and their respective directors, officers, employees and agents will not regard any other person as their client, nor will they be responsible to any other person for providing the protections afforded to their clients or for providing advice in relation to the Offer, the contents of this announcement or any other matter referred to herein.
 

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