7.M&A

Q3 (Share Transfer (Kabushiki-Iten))

What’s the procedure for a share transfer (kabushiki iten)?

A share transfer (kabushiki iten) is a procedure by which an existing company establishes a new company, then the new company acquires all of the outstanding shares of the existing company, and at the same time the new company issues new shares to the shareholders of the existing company, establishing a 100% parent-subsidiary relationship. The end result of the share transfer (kabushiki iten) is that the shareholders of the existing company become the shareholders of the new company, and the existing company becomes the 100% subsidiary of the new company.

A share exchange (kabushiki koukan) is also a procedure to establish a 100% parent-subsidiary relationship, but in that case both are existing companies.

(Posted: January 27, 2012)