Nippon Chemi-Con's recapitalisation has moved from plan to cash and balance-sheet entries. On June 29, the company said payment had been completed for a ¥9bn third-party allotment of new Class C and Class D preferred shares to Development Bank of Japan, after shareholders approved the new share classes and the issuance at the June 26 annual meeting.
| Step | Detail | Amount or price | Date or status |
|---|---|---|---|
| Shareholder approvals | Article changes to create Class C and D shares, issuance approval, and deletion of Class A provisions after cancellation | 6,000 Class C shares and 3,000 Class D shares approved | Approved June 26 |
| Class C preferred issue | All shares allotted to Development Bank of Japan | 6,000 shares, ¥6bn, ¥1mn per share | Paid in June 29 |
| Class D preferred issue | All shares allotted to Development Bank of Japan | 3,000 shares, ¥3bn, ¥1mn per share | Paid in June 29 |
| Capital and reserve reduction | Capital cut to ¥5.45bn, capital reserve cut to ¥522.0mn, other capital surplus increased by ¥9bn | ¥4.5bn reduction to each of capital and capital reserve | Effective June 29 |
| Class A clean-up | All outstanding Class A shares acquired in cash from Japan Industrial Solutions Fund III and cancelled | 10,000 shares, ¥11.03bn total, ¥1,103,493.2 per share | Completed June 29 |
How the funding was structured
The structure was set on March 27: 6,000 Class C shares and 3,000 Class D shares, both priced at ¥1mn per share, with the issuance conditional on shareholder approval and related changes to the articles. Those approvals then arrived on June 26, including the article changes needed to create the new classes and the resolution to issue them to Development Bank of Japan.
By closing day, all 6,000 C shares and all 3,000 D shares had been allotted to Development Bank of Japan. The proceeds split neatly, ¥6bn from the C shares and ¥3bn from the D shares, with half of each amount booked to capital and half to capital reserve. Common shares outstanding stayed at 27,992,541, while the two new preferred layers were added on top.
What changed on the balance sheet
The new securities are not ordinary equity with fancy lettering. The March filing says the Class C shares are non-voting except where law requires, pay a 6.5% preferential dividend for the first three years and 8.5% thereafter, accumulate unpaid dividends, and can be redeemed for cash by either the holder or the company within legal limits. Transfers also need board approval.
The cash leg also triggered the accounting leg. Once payment was complete, Nippon Chemi-Con cut capital by ¥4.5bn to ¥5.45bn and cut capital reserve by another ¥4.5bn to ¥522.0mn, with ¥9bn added to other capital surplus. At the same time, it acquired and cancelled all 10,000 Class A preferred shares for cash at ¥1,103,493.2 a share, or ¥11.03bn in total, from Japan Industrial Solutions Fund III. The June 26 shareholder resolutions had already approved deleting the Class A provisions from the articles after that clean-up.
What the filings do not settle
For readers, the main point is structural. Nippon Chemi-Con now has new preferred capital in place, legal approval for the new classes, and one legacy preferred class removed. What the disclosures do not settle is how much this reset changes operating performance or liquidity headroom beyond the completed financing mechanics. On that, the filings are heavy on method and light on promises.