Blackstone Intends to Launch Tender Offer for Shares in UNIZO Holdings (Securities Code: 3258)

                                                                                                                     October 15, 2019

Urchin Holdings I Pte. Limited, an affiliate of funds managed and advised by Blackstone  Real Estate (“Blackstone”), hereby announces its intention to cause its wholly owned subsidiary, Urchin BidCo GK (the “Offeror”), to launch a tender offer to acquire up to all of the outstanding common shares of UNIZO Holdings Company, Limited (Tokyo Stock Exchange; Securities Code: 3258) (“UNIZO”), at a price of ¥5,000 per common share, subject to UNIZO consent and entry into an agreement between Blackstone and UNIZO (as further described below) by October 23, 2019 setting forth in further detail certain additional terms outlined below (the “Blackstone Offer”). In the event UNIZO does not consent to our launch or enter into such agreement with Blackstone by such date, Blackstone will assess all of its available options at such time.

Purpose and Summary
The purpose of this statement is to provide background on the Blackstone Offer and to clarify our position with respect to, and address, the following:

1. The Blackstone Offer is a Compelling Deal for All Stakeholders
For UNIZO shareholders, Blackstone will offer a compelling price of ¥5,000 per share, which is 151% hig hher than the unaffected UNIZO share price and 25% higher than the current outstanding tender offer. For UNIZO employees, Blackstone is looking to partner with UNIZO employees to enhance corporate value and, as part of this partnership, has committed to maintain or improve employee labor conditions while offering employees the following benefits that they do not currently enjoy:

• the right to participate in an incentive program (including equity participation) to share in the increase in corporate value;
• an opportunity to acquire shares in UNIZO and benefit from future favorable financial performance of UNIZO; and
• minority board representation to have an active voice in discussing UNIZO’s future  direction.

2. Management is Conditioning any Deal on a “Mechanism” that Hurts Shareholders
UNIZO announced that it will reject proposals that do not have a “mechanism” that “ensures the employment of its employees.”1 Blackstone understands that this “mechanism” would effectively give employees the following unprecedented rights to control and profit from an acquiror’s investment:

• Control the acquiror’s returns on its investment;
• Dictate the timing and manner of the acquiror’s exit; and
• Effectively acquire the company, through demanding a post-closing ownership stake in the acquiror and a right to repurchase Blackstone’s UNIZO shares, with UNIZO funds.

Such a “mechanism” is extremely atypical and, we believe, unprecedented in Japan (or potentially elsewhere). Rather than agreeing to a transaction that could provide a windfall to employees at the expense of an acquiror, Blackstone has agreed, if the Blackstone Offer is successful, to provide employees a number of benefits as described above, including the ability to profit alongside Blackstone in UNIZO’s future performance.

Given the fundamental need for UNIZO shareholders to understand in a timely manner the complete situation and potential options available to them, we are announcing that Blackstone stands ready to proceed with the Blackstone Offer on the terms outlined herein. Blackstone has already received all internal approvals necessary for the Offeror to launch the Blackstone Offer. Provided the conditions of the Blackstone Offer described in this release, including UNIZO’s consent, are satisfied, the Blackstone Offer will be commenced promptly. 

Please see the atached Press Release for details.