Merger of J-Phone Companies
Vodafone Group PLC
24 August 2001
24 August 2001
MERGER OF J-PHONE COMPANIES
Vodafone Group Plc ('Vodafone') jointly announced today in Tokyo together with
J-Phone Communications Co. Ltd. ('J-Phone Communications'), J-Phone East Co.
Ltd. ('J-Phone East'), J-Phone Central Co. Ltd. ('J-Phone Central'), J-Phone
West Co. Ltd. ('J-Phone West') and JAPAN TELECOM, that the boards of the four
J-Phone companies have agreed to the merger of their companies, creating a new
unified structure for J-Phone's operations in Japan.
The ongoing merged entity will be J-Phone Communications, to be renamed
J-Phone Co., Ltd. ('J-Phone Co') after completion of the merger.
The merger agreement is subject to shareholder approval and certain regulatory
approvals. EGMs for each of J-Phone East, J-Phone Central, J-Phone West and
J-Phone Communications are scheduled to take place on 10 September. The merger
is expected to close on 1 November 2001.
This re-organisation from the current structure of a holding company and three
regional operating companies to a single company structure will enable faster
decision making processes, increased efficiency, stronger management focus and
improved competitiveness in the Japanese market.
The merger ratio is as follows:
* J-Phone East shareholders will receive 0.566 shares of J-Phone
Communications for each 1 share of J-Phone East held
* J-Phone Central shareholders will receive 0.470 shares of J-Phone
Communications for each 1 share of J-Phone Central held
* J-Phone West shareholders will receive 0.470 shares of J-Phone
Communications for each 1 share of J-Phone West held
Upon completion of the merger, J-Phone Communications will issue 279,836.66
par common shares (50,000JPY face value per share) and allocate them to the
J-Phone East, J-Phone Central and J-Phone West shareholders on the register as
of one day before the merger date, at the above ratios.
Following the merger, JAPAN TELECOM will hold 45.05% of J-Phone Co, Vodafone
will hold 39.67% and other shareholders will hold 15.28%. Vodafone's total
economic interest in J-Phone Co remains at approximately 60%, as it will hold
20.3% indirectly through its 45.0% stake in JAPAN TELECOM in addition to its
direct holding.
Vodafone has nominated the new President ('Shacho') of J-Phone Co, who will be
Darryl E Green, currently President of Asia Global Crossing Japan. He will be
responsible for the overall management and operational performance of the
company, including the supervision of all operational activities. Vodafone
will also appoint the Director of Marketing and Sales and the Director of
Financial Management (both of whom will be Executive Board Members). This
will enhance the delivery to J-Phone Co of the synergy benefits accruing from
its membership of the Vodafone Group.
Vodafone will ultimately be appointing 6 out of a total of 13 members of the
Executive Board.
Mr. Koichi Sakata, Chairman of JAPAN TELECOM, said:
'I am fully convinced that this integration is the key to a smoother approach
towards the launch of next generation mobile phone services. It will
contribute to propelling J-Phone into a strong second position in the Japanese
market, thereby establishing a firm rivalry against NTT DoCoMo.'
Sir Christopher Gent, Chief Executive of Vodafone said:
'I am very pleased that the consolidation of the J-Phone Group is taking place
as I believe that this is an essential step to strengthen further our
competitive position in the Japanese market. This merger will create a
stronger national competitor and promises to generate significant synergy
benefits and efficiency gains.
Vodafone's nomination of Darryl Green, who has lived in Japan for over 15
years, is fluent in Japanese and has substantial experience in the telecoms
industry, as the new President of J-Phone signals our determination to enhance
the performance of J-Phone and ensure that the synergies resulting from our
60% economic interest are fully realised.'
For further information:
Vodafone Group Plc
Tim Brown, Group Corporate Affairs Director
Melissa Stimpson, Head of Group Investor Relations
Darren Jones, Senior Investor Relations Manager
Tel: +44 (0) 1635 673 310
Tavistock Communications
Lulu Bridges/Sarah Landgrebe
Tel: +44 (0) 20 7600 2288
Notes to editors:
Darryl E. Green
President Elect, J-Phone Co., Ltd.
Darryl Green joins J-Phone Co. from Asia Global Crossing Japan, where he was
President from 1999. Before joining Global Crossing he spent ten years in a
number of roles with AT&T, more recently as President and Chief Executive
Officer of AT&T Japan Ltd. and AT&T Jens.
Darryl has played a major role in the development of the internet in Japan,
leading the way in bringing leading-edge IP services to market, most notably
Japan's first phone-to-phone internet telephony service. He is a member of key
study committees of the Ministry of Posts and Telecommunications and is a
well-known figure in the Japanese business community.
Darryl Green is fluent in Japanese and writes frequently for major Japanese
business publications. He holds a master of business administration from the
Tuck School at Dartmouth College.