Board of FUJI SOFT Unanimously Supports KKR Second Tender Offer and Recommends Tender

TOKYO–(BUSINESS WIRE)– KKR, a leading global investment firm, announced today that in connection with the Second Tender Offer in its two-stage tender offer scheme (the “Tender Offer”) for the common shares and share options of FUJI SOFT INCORPORATED (“FUJI SOFT” or the “Company”; TSE stock code 9749) through FK Co., Ltd. (the “Offeror”), an entity owned by investment funds managed by KKR, the Offeror has submitted an amendment statement (“Amendment Statement”) to the Tender Offer Registration Statement that was submitted on November 20, 2024.

The Amendment Statement was submitted due to the Offeror’s decision to extend the end date of the tender offer period for the Second Tender Offer from December 19, 2024 to January 9, 2025. The tender offer price per common share will remain at 9,451 yen, and there is no change to the price that is being considered.

The extension of the tender offer period is intended to allow the Company’s shareholders and share option holders to make a considered decision, in light of the fact that as of December 19, 2024, the market price of the Company’s shares has stayed above the Second Tender Offer price due to the following announcements:

• Bain Capital’s “Notice Regarding Changes to the Terms and Conditions of Tender Offer for the Shares of FUJI SOFT INCORPORATED (Securities Code 9749)” on December 11, 2024;
• FUJI SOFT’s “Notice Regarding the Opinion (in Opposition) of the Board of Directors of the Company on the Tender Offer for the Company Share Certificates by BCJ-88 Co., Ltd.” on December 17, 2024;
• Bain Capital’s “Notice Regarding Changes to the Terms and Conditions of Tender Offer for the Shares of FUJI SOFT INCORPORATED (Securities Code 9749) (Waiver of Conditions Precedent Regarding the Affirmative Opinion, Etc.)” on December 18, 2024; and
• Changes to the terms of Bain Capital’s tender offer proposal.

FUJI SOFT’s Board of Directors resolved on December 17, 2024 to express its opinion of continued support for KKR’s Second Tender Offer, and to recommend the shareholders and share option holders of the Company tender their shares and options, and to express its opinion in opposition of the tender offer by Bain Capital. The Board stated the following main reasons for opposing the tender offer proposal by Bain Capital:

• Bain Capital’s proposal carries the risk of deadlock among major shareholders with respect to special resolutions of shareholders and would not contribute to the improvement of corporate value; and
• Bain Capital’s proposal is inferior to KKR’s proposal in quantitative terms, given that the price premium is incommensurate with the at least three-month delay required by Bain Capital’s tender offer compared to KKR’s Second Tender Offer.

In addition, the Board of Directors considered important factors including:

• Bain Capital’s failure to comply with the Company’s information destruction request and its actions may constitute a violation of its non-disclosure agreement with the Company;
• The possibility that Bain Capital’s proposal dated December 11 may be withdrawn; and
• Bain Capital’s “inadequate response”¹ to the issue of coerciveness in its proposal.

FUJI SOFT also recognized that by changing the terms of its tender offer on December 18, 2024 and waiving the support of the Board of Directors of the Company as a condition precedent to commencement of the tender offer and setting a maximum number of shares to be purchased at 31,444,443 shares (ownership ratio: 49.89%), Bain Capital’s tender offer is no longer intended to take the Company private and has changed into a “hostile partial tender offer with the aim of seizing control of the company,” and this proposal is a violation of Bain Capital’s confidentiality agreement with FUJI SOFT as outlined above.

KKR continues to have strong regard for FUJI SOFT’s growth potential and intends to leverage KKR’s global network and resources and work together with FUJI SOFT’s management and employees to provide better services and solutions for customers and achieve further business growth and value creation for FUJI SOFT after the privatization. This will create value for stakeholders, including management, employees, and customers.

For details on the Amendment Statement, please refer to the release issued by the Offeror today titled “(Amendment) Notice Regarding Amendment to “Notice Regarding the Commencement of Tender Offer for the Shares of FUJI SOFT INCORPORATED (Securities Code: 9749) by FK Co., Ltd.” Following Submission of Amendment Statement to the Tender Offer Registration Statement by FK Co., Ltd.”

***

This press release should be read in conjunction with the release issued by the Offeror titled “(Amendment) Notice Regarding Amendment to “Notice Regarding the Commencement of Tender Offer for the Shares of FUJI SOFT INCORPORATED (Securities Code: 9749) by FK Co., Ltd.” Following Submission of Amendment Statement to the Tender Offer Registration Statement by FK Co., Ltd.”

The purpose of this press release is to publicly announce an extension to the tender offer period for the Second Tender Offer and it has not been prepared for the purpose of soliciting an offer to sell or purchase in the Tender Offer. When making an application to tender, please be sure to read the relevant Tender Offer Explanatory Statement for the Tender Offer and make your own decision as a shareholder or share option holder. This press release does not constitute, either in whole or in part, a solicitation of an offer to sell or purchase any securities, and the existence of this press release (or any part thereof) or its distribution shall not be construed as a basis for any agreement regarding the Tender Offer, nor shall it be relied upon in concluding an agreement regarding the Tender Offer.

The Tender Offer will be conducted in compliance with the procedures and information disclosure standards set forth in Japanese law, and those procedures and standards are not always the same as the procedures and information disclosure standards in the U.S. In particular, neither sections 13(e) or 14(d) of the U.S. Securities Exchange Act of 1934 (as amended; the same shall apply hereinafter) or the rules under these sections apply to the Tender Offer; and therefore the Tender Offer will not be conducted in accordance with those procedures and standards.

Unless otherwise specified, all procedures relating to the Tender Offer are to be conducted entirely in Japanese. All or a part of the documentation relating to the Tender Offer will be prepared in English; however, if there is any discrepancy between the English-language documents and the Japanese-language documents, the Japanese-language documents shall prevail.

This press release includes statements that fall under “forward-looking statements” as defined in section 27A of the U.S. Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934. Due to known or unknown risks, uncertainties or other factors, actual results may differ materially from the predictions indicated by the statements that are implicitly or explicitly forward-looking statements. Neither the Offeror nor any of its affiliates guarantee that the predictions indicated by the statements that are implicitly or expressly forward-looking statements will materialize. The forward-looking statements in this press release were prepared based on information held by the Offeror as of today, and the Offeror and its affiliates shall not be obliged to amend or revise such statements to reflect future events or circumstances, except as required by laws and regulations.

The Offeror, its financial advisors and the Tender Offer agent (and their respective affiliates) may purchase the common shares and share options of FUJI SOFT, by means other than the Tender Offer, or conduct an act aimed at such purchases, for their own account or for their client’s accounts, in the scope of their ordinary business and to the extent permitted under financial instrument exchange-related laws and regulations, and any other applicable laws and regulations in Japan, in accordance with the requirements of Rule 14e-5(b) of the U.S. Securities Exchange Act of 1934. Such purchases may be conducted at the market price through market transactions or at a price determined by negotiations off-market. In the event that information regarding such purchases is disclosed in Japan, such information will also be disclosed on the English website of the person conducting such purchases (or by any other method of public disclosure).

About KKR

KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com. For additional information about Global Atlantic Financial Group, please visit Global Atlantic Financial Group’s website at www.globalatlantic.com.

_________________________
¹ As explained on point (5) on page 22 of FUJI SOFT’s statement dated December 17, 2024: https://www.fsi.co.jp/company/news/2024/20241217.pdf

View source version on businesswire.com: https://www.businesswire.com/news/home/20241219093184/en/

For more information, please contact:

Media Contact

KKR Asia Pacific
Wei Jun Ong
+65 6922 5813
WeiJun.Ong@kkr.com

Source: KKR

• HarbourVest Partners joins forces with Hg and KKR to propel Citation’s growth ambitions, international expansion and innovation in AI.
• The strategic partnership will back CEO Chris Morris and his team as they continue to support the compliance needs of over 110,000 SME customers across the UK, Australia and Canada.

London, UK – 19 December, 2024 – The Citation Group (Citation), an international provider of tech-enabled compliance and certification solutions to small to medium-sized enterprises (SMEs), today announce that they have welcomed HarbourVest Partners (HarbourVest), a global private markets investment manager, as a new investor in the business. This new chapter of investment will see HarbourVest join forces with the management team and majority investors, KKR and Hg, to bolster Citation’s international growth trajectory – organically, through product development in AI and through strategic acquisitions.

Citation supports SMEs in the UK, Canada, and Australia, acting as a critical partner for over 110,000 SMEs businesses navigating the complexities of HR, Health and Safety, and Quality Certifications.

Chris Morris, CEO of Citation, said: “We’re thrilled to welcome HarbourVest as our new strategic partner. Their expertise, along with the continued support from Hg and KKR, will be instrumental as we pursue our vision of simplifying compliance for SMEs globally. Our focus remains on providing peace of mind to business owners, allowing them to concentrate on growing their enterprises, while we protect their people, their businesses and their reputations.”

This transaction follows a period of sustained and rapid growth at Citation, in which the Group has benefited from its leading quality and the breadth of its mission-critical compliance solutions, as well as its hybrid approach in leveraging both software and services to optimally serve its customers’ compliance needs. In the last four years, Citation has entered Canada and Australia – now jointly representing c.20% of revenue, and consistently stayed in excess of “rule of 40” economics.

Gonçalo Faria Ferreira, Managing Director at HarbourVest, said: “We are excited to become a  strategic partner to Citation, joining Hg and KKR to support the Group’s continued growth. Having followed the business for several years, we are impressed by what Chris and his team have achieved. We see strong potential for the business going forward as it continues its mission to simplify compliance for SMEs.”

Joris Van Gool and Nick Jordan, Partners at Hg, said: “Citation stands as a testament to what can be achieved with the right team, technology and strategic partners. The addition of HarbourVest to the fold marks an exciting new phase for Citation, as we continue to unlock the immense potential within the SME compliance space.” Hans Arstad and Rami Bibi, Managing Directors in KKR’s European Private Equity and Global Impact teams, added, “We’re excited to welcome HarbourVest as Citation continues its strong growth under Chris and the team. Together, we’ll further expand Citation’s reach and enhance its offering through strategic acquisitions and innovation, positioning the business for continued success.”

The transaction details have not been disclosed. Jefferies acted as financial advisors to Citation Group, Hg and KKR.

For further inquiries, please contact:

Citation:
Stephanie Beane
Email: stephaniebeane@citation.co.uk

Harbourt:
Andrew Hopkins
Email: ahopkins@harbourvest.com

Hg:
Tom Eckersley
Email: tom.eckersley@hgcapital.com

KKR:
Annabel Arthur
Email: annabel.arthur@kkr.com

About Citation
Citation is a leading provider of tech-enabled compliance (HR, Health and Safety) and certification subscription solutions to SMEs in the UK, Canada, and Australia/New Zealand. Serving a diverse customer base, Citation provides its customers with a suite of software tools and services, supporting businesses both on a day-to-day basis, as well as in their moment of need. Its offering allows customers to operate with confidence in compliance and certification matters, while being a cost-effective alternative to professional services, and a more holistic solution compared to software-only solutions.

About HarbourVest
HarbourVest is an independent, global private markets firm with over 42 years of experience and more than $132 billion of assets under management as of June 30, 2024. Our interwoven platform provides clients access to global primary funds, secondary transactions, direct co-investments, real assets and infrastructure, and private credit. Our strengths extend across strategies, enabled by our team of more than 1,200 employees, including more than 245 investment professionals across Asia, Europe, and the Americas. Across our private markets platform, our team has committed more than $59 billion to newly-formed funds, completed over $58 billion in secondary purchases, and invested over $41 billion in direct operating companies. We partner strategically and plan our offerings innovatively to provide our clients with access, insight, and global opportunities.

About KKR
KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com. For additional information about Global Atlantic Financial Group, please visit Global Atlantic Financial Group’s website at www.globalatlantic.com

About Hg
Hg supports the building of sector-leading enterprises that supply businesses with critical software applications or workflow services, delivering a more automated workplace for their customers. This industry is characterised by digitization trends that are in early stages of adoption and are set to transform the workplace for professionals over decades to come. Hg’s support combines deep end-market knowledge with world class operational resources, together providing compelling support to entrepreneurial leaders looking to scale their business – businesses that are well invested, enduring and serve their customers well. With a vast European network and strong presence across North America, Hg’s 400 employees and around $75 billion in funds under management support a portfolio of around 50 businesses, worth over $160 billion aggregate enterprise value, with around 110,000 employees, consistently growing revenues at more than 20% annually. https://hgcapital.com/