Howa Machinery to Sell Shares via Trust for Employee Benefits Program

TOKYO, Aug 06 (Pulse News Wire) – Howa Machinery,ltd. (6203.T) decided to sell ordinary shares through a private placement to a trust entity associated with its employee stock benefit program (J-ESOP).

The sale will take place on August 24, 2026, involving the issuance of 300,909 ordinary shares at a price of ¥1,475 per share, totaling ¥443.8 million. The shares will be transferred to Nippon Custodian Bank Co., Ltd. (Trust E Account), which holds the shares under a trust agreement established for the J-ESOP program. This decision follows the resolution made during the board meeting held on May 15, 2024, to introduce the J-ESOP program aimed at providing equity incentives to employees.

The additional contribution to the trust fund and the subsequent disposal of own shares are intended to secure future benefits for employees based on projected needs. The number of shares to be disposed of represents approximately 2.0% of the total outstanding shares as of March 31, 2026 (12,548,134), corresponding to the estimated distribution of shares over five fiscal years ending March 31, 2031. The selling price was determined based on the closing price of the company's ordinary shares on the Tokyo Stock Exchange on the day preceding the board resolution, which was ¥1,475. The audit committee confirmed that the pricing did not constitute particularly favorable terms for the transaction.

Given that the dilution rate is below 25% and does not involve changes in controlling shareholders, the company is exempt from obtaining independent third-party opinions and shareholder approval according to the Tokyo Stock Exchange regulations.