■No.1 ＜3562＞ Main Topics
1. Market development through capital and business alliances with Hyper
On 2024/3/14, a capital and business alliance involving a third-party allotment of shares was announced between NDS, a subsidiary that provides the enterprise cloud operation and maintenance service “DigiTerrace” and web solutions, and Hyper ＜3054＞, which develops the IT service business and ASKL Agent business, etc. ※. Cooperation has been sought with Hyper until now, but opinions were agreed that further synergy creation can be expected, leading to this case. In particular, “digital terraces” and web solutions provided by NDS have a high affinity with the medium-sized enterprise class (100 employees) targeted by Hyper, and there is a major aim to develop a new customer base.
*3,000 shares of NDS common stock were allocated to Hyper (the amount of funds raised was 30 million yen). After this incident, Hyper's ownership ratio of NDS shares will be 30% (the company's ownership ratio is 65%).
2. Active investment in growth (strategic) fields through M&A
On 2024/4/24, the company and Alexon made OZ MODE, which handle SES business* and IT Engineering, which handle software development contracts, into subsidiaries, respectively, and decided to advance into the SES business as new businesses. It is the first investment in a “new business area” in line with the priority strategies of the new medium-term management plan described later, and it aims to enter the growth area.
*Abbreviation for system engineering service business. It is a service that provides engineers (engineers) necessary to continue operations such as software and system development, maintenance, and operation for a necessary period of time.
(1) OZ MODE Overview
We have major customers in areas where demand for IT development is high, such as the semiconductor manufacturing equipment industry, travel industry, and medical care, and about 30 engineers are dispatched as SES*1. It is scheduled to become a subsidiary in 2024/6 through a simple stock exchange*2. There are aims for 1) entering the SES business, 2) securing and nurturing digital human resources, 3) incorporating system development functions, 4) reskilling the company's employees, and 5) in-house production of the company's core system development, maintenance, and operation operations.
*1 The most recent financial results (fiscal year ending March 31, 2023) were net sales of 484 million yen and operating profit of 25 million yen.
*2 The number of shares issued is 319,200 shares.
(2) Overview of IT Engineering
In recent years, we have engineers with high skills such as Python*1, which are in high demand, and have at least 15 years of experience. The group joined in 2024/4 due to share acquisition (making it a wholly owned subsidiary) by Alexon*2. Along with acquiring know-how related to the SES business, there are advantages in approaching the partner's customer base.
*1 A programming language that is highly versatile, easy to understand, and easy for beginners to handle. It is developed with open source and is used on many platforms.
*2 The most recent financial results (fiscal year ending 2023/9) were sales of 103 million yen and operating profit of 13 million yen. The acquisition price is not disclosed.
3. Concluded a hands-on business alliance with Growth Partners
On 2024/4/24, a business capital alliance agreement was signed with Growth Partners Co., Ltd., which is represented by Mr. Furukawa Tokuatsu, who has extensive management consulting experience. We aim to improve the company's corporate value by receiving hands-on*1 support based on investors' perspectives, such as 1) improving the competitiveness of existing businesses, 2) development support for new products and services, 3) M&A introduction/negotiation support, and 4) human resource recruitment/IR advice. The company allocated 31,900 new shares and 3,808 stock acquisition rights (10th 1,808, 11th 2,000) to Growth Partners on 2024/5/10 (*2).
*1 Support that goes deep into management.
*2 The amount of funds raised from new shares is approximately 30 million yen, and the issue price of stock acquisition rights is approximately 2.5 million yen. Also, when all stock acquisition rights are exercised at the initial exercise price, the amount of funds raised rises to approximately 472 million yen. Note that the exercise price is 940 yen for the 10th session and 1,500 yen for the 11th session. The exercise request period is from 2026/5/11 to 2030/5/10 for the 10th, and from 2028/5/11 to 2030/5/10 for the 11th. Most of the funds raised are planned to be used for M&A.
(Written by FISCO Visiting Analyst Ikuo Shibata)