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The JFTC Closed its Review on the Proposed Acquisition of Shares of BEST DENKI Co., Ltd.by YAMADA DENKI Co., Ltd.

December 10/2012
Japan Fair Trade Commission

Upon a notification regardinga proposed acquisition of shares of BEST DENKI Co., Ltd. (BEST DENKI)by YAMADA DENKI Co., Ltd. (YAMADA DENKI), the Japan Fair Trade Commission (JFTC)had reviewed the planned stock acquisition and reached the conclusion that, on the premise of the remedies offered by YAMADA DENKI,the deal would not substantially restraincompetition in any particular fields of trade. Accordingly, the JFTC has notified YAMADA DENKIthat a cease and desist order will not be issued by the JFTC, resulting in the completion of its review.

I. Outlines of the transaction

 An electric appliance retailer YAMADA DENKIplans to acquire the stocks of BEST DENKI, a company retailing electric appliances as well, and thereby to obtain more than half of BEST DENKI’s voting rights.

II. Reviewing process

 Receipt of the notification regarding the proposed acquisition of BEST DENKI’s shares byYAMADA DENKIon June 7,2012 (start of primary review)

 Request for reports, etc. by the JFTC on July 6, 2012 (start of the secondary review)

 Receipt of all requested reports from YAMADA DENKI on December 4, 2012 (the due date for a prior notice was set on March 5, 2013)

 Submission of a report on changes in the notification by YAMADA DENKI, in which the remedies were incorporated on December 7, 2012

 Notification to YAMADA DENKI that a cease and desist order will not be issued on December 10, 2012

III. Conclusion

 YAMADA DENKI and BEST DENKI are competing with each other in 253 geographical areas that are defined as the particular fields of trade by the JFTC. By examining the competition condition in respective areas, the JFTC had found that the planned stock acquisition initially notified to the JFTC would substantially restrain competition in 10 out of the 253 geographical areas. YAMADA DENKI thereafter offered remedies to address the JFTC’s concern where YAMADA DENKI would divest 8 stores in the 10 areas. The JFTC concluded that the remedies offered would be sufficient to eliminate the competitive concern that could arise by the share acquisition and that,given the remedies, the acquisition would not substantially restrain competition.

(Foot Note)

The JFTC has been authorized to conduct reviews on whether business combination plans may be substantially to restrain competition in particular fields of trade by following procedures prescribed in the Antimonopoly Act. When a notifying corporation submits the notification form to the JFTC and the JFTC receives it, the notifying corporation is prohibited from effecting share acquisition, etc. in question until the expiration of the 30-day waiting period from the date of receipt of the said notification. During the waiting period, concerning the business combination in question, the JFTC will normally either; (1) judge that the said business combination is not problematic in light of the Antimonopoly Act, or; (2) judge that more detailed review is necessary and request submission of the necessary reports, information or materials.

In the case of (1) above, to improve transparency of the review of business combination, the JFTC shall give notification to the effect that it will not issue a cease and desist order.

In the case of (2) above, the period when the JFTC may give notice prior to cease and desist order shall be extended until 120 days after the date of receipt of the notification or 90 days after the date of receipt of all reports etc., whichever is later. In case the JFTC judges in this extended period that the business combination plan in question is not problematic in light of the Antimonopoly Act, it shall give notification to the effect that it will not issue a cease and desist order, same as the case of (1).

*Every announcement is tentative translation. Please refer to the original text written in Japanese.



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