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M&A and Subsidiary Changes3697SHIFT Inc.Information and Communications, Services and Others

Notice Regarding the Absorption-Type Merger (Simplified Merger) of Our Consolidated Subsidiary (DICO株式会社)

SHIFT plans to absorb DICO, a wholly owned subsidiary in which it holds 100% of the voting rights, and DICO is expected to be dissolved. As this is an intra-group transaction, no consideration will be paid for the merger.

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This transaction

Organizational restructuring (absorption-type merger)
Counterparty (target company)DICO株式会社
Disclosing companySHIFT Inc.
Subject of this transactionVoting rights ownership percentage Before 100% (after not disclosed)
TimelineThe spacing between the points is proportional to the actual number of days.White points represent dates designated as scheduled dates in the document.
Target company

Planning, development, production and localization of games, and related businesses

Location Shibuya, TokyoShare capital ¥5 millionDate of incorporation 1 March 2011
Net Sales¥712 million (fiscal year ended August 2025)
Operating profit¥16 million (fiscal year ended August 2025)
Net income for the current fiscal year-¥26 million (fiscal year ended August 2025)
Net assets¥450 million (fiscal year ended August 2025)
Consideration and expenses
Acquisition priceNone planned
Type of ConsiderationNone planned
Impact on Business Performance

The impact of this transaction on the Company's operating results and financial condition is expected to be immaterial. If a material impact arises due to a significant change in business conditions, the Company will promptly disclose it once the details become clear.

Procedures and assumptions
Management structure after acquisitionThere will be no changes resulting from this organizational restructuring to the name, head office location, representative's title or name, business activities, capital or fiscal year-end.
This transaction
ItemDetails
Transaction nameOrganizational restructuring (absorption-type merger)
Counterparty nameDICO株式会社
Name of the Subject CompanyDICO株式会社
Business Description of the Subject CompanyPlanning, development, production and localization of games, and related businesses
Location of the Subject CompanyShibuya, Tokyo
Capital Stock of the Subject Company¥5 million
Date of Establishment of the Subject Company1 March 2011
Net Sales of the Subject Company¥712 million (fiscal year ended August 2025)
Operating Profit of the Subject Company¥16 million (fiscal year ended August 2025)
Net Income of the Subject Company-¥26 million (fiscal year ended August 2025)
Net Assets of the Subject Company¥450 million (fiscal year ended August 2025)
Acquisition priceNone planned
Type of ConsiderationNone planned
Voting rights ownership percentageBefore 100% (after not disclosed)
Impact on Business PerformanceThe impact of this transaction on the Company's operating results and financial condition is expected to be immaterial. If a material impact arises due to a significant change in business conditions, the Company will promptly disclose it once the details become clear.
Date of board resolution25 August 2026
Contract Date1 September 2026 (予定)
Execution Date / Effective Date1 December 2026 (scheduled)
Management structure after acquisitionThere will be no changes resulting from this organizational restructuring to the name, head office location, representative's title or name, business activities, capital or fiscal year-end.
Items this document does not state (13)
Expenses other than the acquisition priceMerger ratio/share exchange ratioTender offer priceMinimum number of shares to be purchasedTender offer periodNumber of shares acquiredFunding arrangementsGoodwill amountAmount of extraordinary income (loss)Valuation methodologyIndependent valuation institutionSpecial CommitteeConditions Precedent to Execution

These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.

The reasons the company gives

The company's own explanation, not something inferred from the numbers.

The purpose is to streamline management resources and strengthen the delivery structure for LQA in response to changing demand in the localization business, including growing demand for LQA and AIPE, while anticipating market volatility driven by AI. Other reasons include strengthening cross-selling proposals by leveraging SHIFT's project management expertise in software quality assurance, integrating resources with KINSHA, and improving management efficiency through the integration of back-office functions.

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Notice Regarding the Absorption-Type Merger (Simplified Merger) of Our Consolidated Subsidiary (DICO株式会社) | SHIFT Inc. (3697) timely disclosure | Komori