Outline of DBJ and Its Services - jetro.go.jp · nThe PFI project not only reduces ... documentation lPreparation of ... Supermarket Stores in Kinki District by Pororoca to Ontsu

November 2006

Outline of Outline of DBJ and Its ServicesDBJ and Its Services~~ Business opportunities & advantages Business opportunities & advantages

for investment in Japan for investment in Japan ~~

Keisuke TakegaharaChief Representative in Frankfurt

Development Bank of Japan

Page 2Development Bank of Japan

1-1. Outline of Development Bank of Japan ( DBJ)

n Established in 1951ü A public financial institution fully owned by the

Japanese Government

ü DBJ has been carrying out effective financing for over 50 years

n Missionü Upgrading vitalization and sustainable development

of economy and society

ü Realization of enhanced quality of life

ü Creation of self-reliant regions

n Capitalization: 1,215 billion JPNn Assets: 13,682 billion JPN

n Capital Ratio: 16.07%

n Rating: AA-( S&P) A2( Moody's)


1-2. Outline of DBJ

n Services

ü Corporate banking

- mid- to long term Loans featuring fixed interest rates for projects

undertaken in Japan

- debt guarantees to other banks

ü Investment banking, including equity investment and M&A advisory service

ü Research and information providing service


Overseas

1-3. Outline of DBJ

In Japan

§ Broad Networkü Head office in Tokyo, 10 branches and 8 representative offices in Japan,

6 representative offices worldwideü Over 4,000 clients (including big names and SME)ü Cooperating with JETRO, regional banks, law firms, accounting firms etc.


2-1. Promotion of FDI in Japan / DBJ FDI-Program

n The Japanese Government welcomes foreign direct investment

n DBJ is financing projects that help to vitalize and enhance theJapanese economy.

ü Loan programs since 1984

ü About 300 companies

ü 900 billion JPN in loans as of March 2006


2-2. DBJ FDI-Program

n Interest rate

ü fixed at the time of disbursement. Rates are determined in accordance with the term, grace period and security for each loan.

Market Rate

DBJ Rate

LIBOR

5 6 7 8 9 10 11 12 13 14 15

Maturity (Years)

Risk Premium

Preferential Treatment


2-3. DBJ FDI-Program

n Target projects

ü Capital investments in Japan

ü Research and development costs in Japan.

ü Mergers and acquisitions (M&A) with companies in Japan.

ü Rent deposits required of tenants.

ü Portion of working capital needed for business start-up and expansion.


2-4. DBJ Clients - Case 1






3-1. Swiss companies in Japan

Swiss companies in Japan(source: DBJ Reserach 09.2006 n=391)

trade15%machinery

33%

others14%

IT2%

financialinstitutions

3%

electronicdevices

9%

services11%

chemical industry5%pharmaceutical

5%

metal processing3%


3-2. TOP 10 of Swiss companies in Japan by turnover 2005

10,282BSI S.A.10

14,043Kühne+Nagel International AG9

25,613Alcan Aluminium Valais AG8

27,765Swiss Reinsurance Co.7

28,303ABB Ltd.6

35,494F.Hoffmann-La Roche Ltd.5

40,566Novartis AG/ Novartis Holding AG4

60,602Credit Suisse Group3

84,583Zürich Financial Services2

91,030Nestlé S.A.1

turnover 2005(Mio. CHF)swiss companies in Japan

(source: DBJ Research, companies)


n syndicate loans to a local medical institution which introduced PET ( Positron Emission Tomography) equipment.

4-1. Supporting the development of the medical and welfare industry

n Support of medical and welfare industry for the needs of Japan’s aging society.


n Location: Sendai

n Creation of new businesses of welfare equipment and services with joint efforts of companies both in Finland and Sendai.

http://sendai.fwbc.jp/e/index.htmhttp://www.finnfacts.com/german/main/actualities/sendai.html

4-2. Sendai-Finland Wellbeing Center


n Preservation of medical services in many municipalities became difficult. (Superannuation of the facilities.)

n Some cities have begun to solve this problem by using the PFI (The private finance initiative).

n The PFI project not only reduces business costs for local government, but also provides higher- quality services.

4-3. Project Financing for Public Hospitals


Tokyo Head Office

Akira Sato (Mr.) [email protected] +81-3-3244-1783Fumiyo Harada (Ms.) [email protected] +81-3-3244-1774Tomoaki Kawabe (Mr.) [email protected] +81-3-3244-1771Maiko Shibata (Ms.) [email protected] +81-3-3244-1773

Tel: +81-3-3244-1777Fax: +81-3-3245-1938

Frankfurt Representative Office

Keisuke Takegahara (Mr.) [email protected] +49-69-71917612Daiga Wada (Mr.) [email protected] +49-69-71917614Ralph Fülop (Mr.) [email protected] +49-69-71917613

Tel: +49-69-7191760Fax: +49-69-71917615English: http://www.dbj.go.jp/english/index.htmlGerman: http://www.dbjffm.de

Contact us


TThank you very much!hank you very much!


Eligible Recipients

n Japanese KK (Kabushiki Kaisha) or YK (Yugen Kaisha) with over one-third foreign capital

n Registered branches of foreign companies in Japan

n Parent companies of Japanese entities making investments in Japan, or financing companies linked with such Japanese entities


Terms and Conditions ( 1)

n Loan amountü Maximum 40-50% of the total project cost. Co-financing with

commercial banks is required in most cases.ü Normally from 8 digits (e.g. JPY XX,000,000). No upper limit.

n Term and grace periodü Loan terms and grace periods are set according to the cash-flow

needs of each project. ü Loan terms usually range from 5 to 10 years, but may be

extended to 15 years when the project warrants it.ü Grace periods are from 0.5 to 3 years. Short-term loans are not

available.



n Payment conditionsrepaid in equal installments

n Prepayment conditions Prepayment is possible but entails a penalty

n Post default interestPost default interest is charged at a rate of 14.5%. This rate cannot be changed.



n SecurityA guarantor (e.g. parent company) is required in principle.

Covenants may be requested if considered necessary.Collateral may also be required.

n Settlement reports

n Governing law DBJ loans are governed by, and construed in accordance with, the laws of Japan.

n Use of Japanese or English language


nDiverse Range of Project funding

· Corporate senior loans at a preferred interest rate based on Japanese governmental policy

· Debt guarantees to other Banks, or extend loans to SMEs with standby L/C from main banks

· Non/Limited recourse loans for Project financing, Asset-based · financing, LBO, etc.· High-risk financing, including Mezzanine loans, equity investment

through funds targeted for business restructuring, venture, etc.

nArranges local financing in Japan

· Syndicated loans, Private/Public issues bonds· Develops innovative financial schemes

Various Options for our Clients


ü Unbiased organization with having over 4,000 own customer base

ü Alliance with 75 regional banks – Complimentary to DBJ’s nationwide-type customers

ü Professional in defining & communicating with right partner & right person

ü Professional in communicating right way with various type of Japanese management

ü DBJ got results in cross-border transaction.

ü DBJ has supported 700 overseas’ enterprises to come to Japan.

ü Financing capability including subsidized loan

Unbiased Broad Network

Professional in Japanese Transaction

Leader in Supporting Foreign Direct Investment

One Stop Service

1-2-1. DBJ as M&A & Financial Advisor


Strategic consulting Match-making Execution Finance

Deal co

mp

letion

l Review of business portfolio

l Formulation of business strategies

l Analysis of management issues and evaluation of strategic alternatives

l Industry analysis and data gathering

l Financial analysis, Assessment of transaction risks Valuation, Assessment of fair corporate value

l Deal structuringl Due diligence supportl Negotiationl Preparation of legal

documentationl Preparation of

presentation materials

l Buy side: Identification and appraisal of candidates for acquisition

l Sell side : Identification and appraisal of potential buyer

l Approach to candidates

l Long-term fixed rate debt financing

Services

Our team provides professional and committed project management support throughout the whole business development and M&A process.



Total Solutions

StrategicConsulting

Execution Finance

Identifying potential business opportunities and promoting successful transactions

Furnishing advices appropriate to either buyer or

seller

Providing long-term funds of a quality rarely available from private financial institutions

n Advantages of DBJ

ü Skilled analysis of mid- to long-term business

ü Broad network through lending and project organizing support

ü Providing comprehensive problem-solving services form strategic consulting to finance

ü As a policy-based bank, DBJ works on deals that achieve the Promotion of FDI into Japan



March, 2003Acquisition of LPG Business from Kanematsu by Iwatani

April, 2004Acquisition of LPG Business

from Iwasaki by Iwatani

Buy-side Advisor

June, 2004

Divesture of Packing Materials Division of NSCC

Polymer by Nippon Steel Chemical to AIG Japan

Partners

Sell-side Advisor

May, 2005

Divesture of Supermarket Stores in

Kinki District by Pororoca to Ontsu

Buy-side Advisor

Consultation and Implementation of Business

Planning of Kashiyama Kanagata

January, 2003

Consulting Service

November, 2002

Strategic Alliance between Meiden-sya and KCI

Konecranes on Meiden Hoist Systems

Sell-side Advisor

August, 2003

Business Transfer of NankaiSouthtower Hotel from

Nankai Railway to Raffles International

Sell-side Advisor

July, 2001

Acquisition of MDI by SiwardCrystal Technology

Buy-side Advisor

1-3-1. Some Examples of Transaction Records

December, 2003

Buy-side Advisor

Acquisition of Shares of Marusei Rubber from Fujikiko

by Yasufuku Rubber

May, 2001

Acquisition of KMT Semi-Conductor

from Kobe-Steel

Buy-side Advisor

March 2006

Advisor of Sunpot

TOB of Sunpot (Listed on 2nd section of Tokyo Stock

Exchange)

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Documents

Outline of DBJ and Its Services - jetro.go.jp · nThe PFI project not only reduces ... documentation lPreparation of ... Supermarket Stores in Kinki District by Pororoca to Ontsu