The Changing Japanese M&A Market

18th Asia Business ConferenceFebruary 2, 2008

Presented By: Nobuhiko Masuto

2

Growth in the Japanese M&A Market – What are the Drivers & Will it Last?

0

500

1000

1500

2000

2500

In- InIn-OutOut- In

Source: Recof

# of Deals

（ 07: Jan. – Sept.)

The Japanese M&A market has been growing tremendously in recent years and it is anticipated that this trend will continue.

3

Japan 3.7% U.K. 13.4% U.S. 　 10.3%

Global M&A Market - % by Country

M&A Market Size vs. GDP

Source: Thomson Financial, OECD

Japanese M&A market is still immature

Potential to expand 3-5 times current levels

Other36%

Japan6% U.K.

11%

U.S.47%

Tremendous Growth Potential in the Japanese Market

4

- Distressed M&A

- Divestitures of non-core businesses

- Group company restructuring

- M&A by healthy corporate（ larger deals）

- PE Fund driven M&A- Cross-border deals

- Hostile M&A- MBO/ De-listing

- Smaller distressed deals - Non-core spin-offs

Late1990’s ～Early 2000

Current

- Group restructuring

Changes in the Type of Deals Being Pursued

5

Shareholders with various investment measures – short-sighted investment efficiency requirement

Limited growth expectation in every Japanese domestic market

Fiercer global competition

Restructured Japanese financial sector

End of corporate governance by banks

Establishment of more sophisticated M&A rules

Background Drivers of Japan’s Changing M&A Market

6

Increase in:

M&A deals driven not only by PE funds but also by strategic corporate buyers 　→　 auction, consortium, etc.

Strategic in-out cross-border deals - actively seeking market share, geographical expansion and IP overseas

Acquisitions of Japanese companies by foreign companies (out-in) – representing next step in strengthening strategic alliances

Deals associated with sector consolidation (retailers, domestic airlines, etc.)

Divestitures of non-core businesses by large company groups

Public M&A deals from hostile actions of financial buyers (increased cross-shareholdings, but not going back to the old days!)

Introduction of poison pills by public companies in every sector

MBO/ going private deals

Small private M&A deals for the purpose of business succession

Decrease in:

M&A deals for purposes of diversification of business lines

Large restructuring deals

Recent Trends in the Japanese M&A Market

7

Increasing Cross-Border M&A Deals

0

50

100

150

200

250

300

350

400

450

500

In-OutOut- In

# of Deals

（ 07: Jan. – Sept.)

Source: Recof

The number of acquisitions of Japan assets by foreign companies (“out in”) is increasing significantly. There was an increase of 80.6% for the period 1/07-9/07 vs. the same period for the prior year.

8

Cross-Border M&A Activity has Spanned All Industries

Every sector is seeing cross-border activity and the size of deals has also been significant with landmark deals, such as Ricoh’s acquisition of IBM’s printing division and Citigroup’s acquisition of Nikko Securities, shown below.

Takeda

-Syrrx

Pharma

Nidec

-Valeo

Automotive

Ricoh

- IBM

Mfg.

Softbank-

- Vodafone

Telecom

JT

- Gallaher

Food

Services

Autobacs

- Autofin

Retail

O ｒ ix

-Houlihan

Financial

Services

Roche

-Chugai

Daimler

– Mitsubishi

Fuso

Bosch

-ZEXEL

Vodafone

-Nippon

Telecom

Compass

　 -Seiyo Food

Wal-Mart

　 -Seiyu

Citigroup

-Nikko

Securities

IN-OUT

Industry

OUT-IN

9

Top 10 Announced Japan Acquisitions of Foreign Assets (“In-Out”) (1/06-10/07)

Source: Factset

Rank Announce Buyer Target Deal SizeUS$ million Target Sector Country

1 2006/12/15 JT Gallaher Group PLC 15,024 Agricultural Production UK

2 2006/1/23 TOSHIBA Corp. Westinghouse Electric Co. LLC 5,400 Construction Contractors &Eng. Svcs. UK

3 2006/12/12 Tokyo Electric Power Co, Inc. /Marubeni Corp. Mirant Asia Pacific Ltd. 3,420 Electric, Gas Water & Sanitary

Services US

4 2006/2/27 Nippon Sheet Glass Co. Ltd. Pilkington PLC 3,042 Stone, Clay & Glass UK

5 2006/11/2 Nomura Holdings, Inc. Instinet LLC 1,200 Brokerage, Investment &Mgmt. Consulting

US

6 2006/10/4 Daikin Industries Ltd. OYL Industries Bhd. 1,129 Industrial & Farm Equipment &Machinery MY

7 2006/12/5 Bridgestone Corp. Bandag, Inc. 990 Automotive Products &Accessories US

8 2007/7/5 Fast Retailing Co., Ltd. Barneys New York, Inc. 950 Retail US

9 2006/12/19 Nomura Holdings, Inc. Fortress Investment Group (Hedge Funds)

888 Brokerage, Investment &Mgmt. Consulting

US

10 2006/5/18 Daikin Industries Ltd. OYL Industries Bhd. 825 Industrial & Farm Equipment &Machinery MY

10

Source: Factset

Rank Announce Buyer TargetDeal Size

US$ millionBuyer Sector Country

1 2007/3/6 Citigroup, Inc. Nikko Cordial Corp. 7,702 Banking & Finance US

2 2007/10/2 Citigroup, Inc. Nikko Cordial Corp. 4,710 Banking & Finance US

3 2007/4/13 Morgan Stanley Hotels owned by ANA 2,358Brokerage, Investment &Mgmt. Consulting

US

4 2007/2/15 Steel Partners LLC Sapporo Holdings Ltd. 1,282Brokerage, Investment &Mgmt. Consulting

US

5 2006/2/2 Vivendi SA Universal Studios, Inc. 1,154 Printing & Publishing FR

6 2007/2/19 Volvo AB Nissan Diesel Motor Co., Ltd. 1,083 Autos & Trucks SE

7 2006/10/4 The Shaw Group, Inc. Westinghouse Acquisition 1,080 Construction Contractors &Eng. Svcs.

US

8 2006/12/21 Air Liquide SA Japan Air Gases Ltd. 777Chemicals, Paints &

CoatingsFR

9 2007/3/1 Delek Group Ltd. RoadChef Motorways Ltd. 734 Oil & Gas IL

10 2007/8/24 MBK Partners Ltd. Yayoi Co., Ltd. 613Brokerage, Investment &Mgmt. Consulting

KR

Top 10 Announced Foreign Acquisitions of Japanese Assets (“Out-In”) (1/06-10/07)

11

Buyout Fund Environment

Corporate Restructuring Needs

Financing M&A Deals（ Bank/ Fund ）

Capacity of Management Supply

Japanese M&A Market

Stay

12

Buyout Deals by PE Funds in Japan

The Japanese buyout market has been dramatically expanding. There are has been an increase in the number of PE funds focusing upon Japanese corporations and the size of the deals has been large.

However, the level of its popularity is still lower than that in the Western countries and there is more room for expansion with more flexibility of investment criteria.

With the increase in investments by PE funds, secondary M&A activities by through portfolio companies are increasing.

Source: MARR 2/2006

8 13 25 29

98

198

26149

97

96

2

111273

2

2

0

50

100

150

200

250

300

350

400

1998 1999 2000 2001 2002 2003 2004 2005

OUT-OUTOUT- ININ- IN

Number of Buyout Deal Investment by PE Fund（ No. of Deals ）

3 27

23

56

1

8

1

3

2

4

2

0

10

20

30

40

50

60

70

2000 2001 2002 2003 2004 2005

OUT- ININ-OUTIN- IN

Number of Sale by PE Fund（ No. of Deals ）

13

Japanese corporate have gained an understanding of how PE fund can contribute to corporate growth.

Role of PE Funds in Japan

IPO in 3 ～ 5 yearsor

Sale to future strategic partner/ other fund

Increased Value throughUnleashing Potential

Enhancement of Corporate Governance

Increase efficiency of management through sending directors/ auditors

May strengthen management by sending CEO/ CFO

Drive management improvement through external governance

Support improvement of internal control systems

Introduction of Advanced Corporate Finance Methods

Plan business restructuring and M&A and give execution support

Review and try to achieve optimum capitalization (e.g. repackage debt)

Provide financial advice on securitization of unutilized assets, etc.

Business Support

Support business / strategic planning Bring business alliance ideas by fully

utilizing fund network Create synergies with other portfolio

companies Other senior advisors of fund provide

advice on various operational/ business issues

14

Likely Targets of PE Funds

Large net cash （ large distributable dividend ）

Large surplus on B/S

Large unrealized assets

Asset Driven

Low PBR

Small market capitalization

Share Price Driven

Low ratio of stable shareholders

Complicated cross shareholdings in group capital structure

Fragmented sector

Other

Effective use of cash （ CAPEX/ M&A ）

Effective use of assets

Optimizing enterprise value

Pro-active IR (investor relations)

Recapitalization of group companies

Remedy

15

Case Study: Acquisition of Japanese Subsidiary by PE Fund (Carlyle)

Situation Overview

GCA, based on its knowledge of Shionogi & Co. Ltd. (“Shionogi”) operations, recommended that Shionogi consider divesting its Qualicaps Group, which manufactured hard capsules used in the pharmaceutical and health and nutrition industries.

GCA identified Carlyle Japan Partners (“Carlyle”) as a potential buyer. Carlyle requested that GCA serve as its lead financial advisor in the prospective transaction.

While Carlyle presented a potential exclusive offer to Shionogi, in order to meet its fiduciary responsibilities, Shionogi proceeded the transaction with a competitive bid process.

Successfully executed the first transaction where a major Japanese pharmaceutical company spun-off operations to a foreign private equity fund among other strategic buyers.

GCA devised several unique structures that would enable Carlyle to have a competitive advantage in the bidding process.

Acquiring

August, 2005

Advised The Carlyle Group

16

Case Study: Cross-Border Joint Venture US-Japan (Ricoh/ IBM)

Situation Overview

Ricoh’s corporate strategy included becoming a leading global provider of output and print solutions.

IBM’s strategy included putting a greater focus on software and services, while the hardware business was seen to have an important strategic role.

As IBM’s Printing Systems Division was well-integrated into the businesses in over 100 countries, the division had to be carved out before being sold to the third party.

Results

By forming the joint venture between IBM and Ricoh instead of outright sale of the division to Ricoh, it becomes essential for both parties to establish a cooperative relationship for the success of the joint venture.

Ricoh initially acquired 51 percent of the joint venture, called the InfoPrint Solutions Company, with Ricoh progressively acquiring the remaining 49 percent over the next three years as the joint venture evolves into a fully owned subsidiary of Ricoh. Final consideration will be determined at the end of the three-year period based upon the joint venture’s performance.

Advised Ricoh

and

Formation of Joint Venture between

Ricoh IBM

CountryA B X・・・

: printer business

IBM

A

A X・・・US

B X・・・

IBM

A

JV

B X・・・

cash

51%Ricoh IBM

A

JV

B X・・・

cash

remainingstake

Pre-transaction Carve-outs At closing At the end of JV period

June 2007

17

PremiumPremium

Case Study: Corporate Hostile M&A Battle (Oji Paper VS Hokuetsu Paper)

An landmark hostile M&A battle involving a large Japanese corporate in an industry facing extreme consolidation.

Is a hostile TOB by corporate achievable?

Appropriateness and effectiveness of defense measure

Timing of introduction to poison pill Judgment of independent committee

Fight on banning issuance of warrant

Opinion of independent committee

Policy difference by type of shareholder

Does shareholders tender their shares to TOB?

Meaning of TOB price and price for 3rd party allotment (new issue)

Strategic buyer/ white knight as defense measure

Accountability to local community and employees of Hokuetsu

More……

An landmark hostile M&A battle involving a large Japanese corporate in an industry facing extreme consolidation.

Is a hostile TOB by corporate achievable?

Appropriateness and effectiveness of defense measure

Timing of introduction to poison pill Judgment of independent committee

Fight on banning issuance of warrant

Opinion of independent committee

Policy difference by type of shareholder

Does shareholders tender their shares to TOB?

Meaning of TOB price and price for 3rd party allotment (new issue)

Strategic buyer/ white knight as defense measure

Accountability to local community and employees of Hokuetsu

More……

SynergySynergy

800 yen

607 yen

635 yen

Price for 3rd Party Allotment to Mitsubishi Corp.

TOB Price By Oji Paper

Purchase Price by Nihon Paper

813 yen

Market Price @ 7/21

Stand-aloneValue

Stand-aloneValue

18

Case Study: Citigroup Acquired Nikko Cordial through TOB and Subsequently Squeeze out Situation Overview

Nikko Cordial Securities, Inc. (“Nikko”), one of the largest Japanese brokerage houses in terms of revenue, faced a sharp stock decline and threat of delisting after it announced earnings for the past two fiscal years would be restated due to "inappropriate accounting."

Citigroup, Nikko’s partner in an 8-year old investment banking venture, in an attempt to avoid a crisis of confidence and protect the value of its stakeholders, proposed a Tender Offer in the amount of 1,350 yen per share. Citigroup executed TOB for 1,700 yen per share through its wholly owned subsidiary, Citigroup Japan Holdings, and successfully completed it with more than 50% voting rights in March 2007.

Since then, Citigroup bought more shares in Nikko through Citigroup Japan Holding from the stock market up until 68%, whereby they obtained enough voting rights for merger on its own.

Subsequently, in October 2007, Citigroup announced that it would bring Nikko into a wholly-owned subsidiary through a triangular share exchange transaction, resulting in Nikko being de-listed from the Tokyo Stock Exchange. (1st transaction using a triangle merger method lifted in May 2007)

Citigroup Japan Holdings is scheduled to be listed on the Tokyo Stock Exchange and the Japanese shareholders who would receive the Citigroup shares through the triangle share exchange transaction can trade in the market.

Squeeze Out Transaction Scheme

TOB of the Common Stock of

by

March, 2007

Advised Nikko Cordial Corporation

Squeeze out through Triangular Share Exchange

by

January 2008

Advised Nikko Cordial Corporation

Citigroup (U.S.)

Nikko(Japan)

SHs

100% subsidiary

100% subsidiary

DistributeCiti shares

Nikko shares

Citigroup Japan

Holdings

19

Increased number of out-in cross-border M&A transactions

More remarkable/sizable out-in cross-border M&A deals

Accelerated changes in the general mindset of Japanese corporate management

There is no longer a negative image associated with selling/spinning off a company

More focused business plans based upon competitiveness and resource allocation

Reduction in rejection of the idea of doing a transaction with foreigners

More favorable to partner with strong foreign companies than to be controlled by a foreign financial buyer

Substantially decrease in cross-shareholdings and quiet and non-economical shareholders

Increase in foreign shareholder ratio in Japanese public company

More westernized corporate governance, accountable disclosure system, transparent accounting system and new M&A rule – triangle merger

Japanese M&A financing market still in good condition

Increased Opportunities to Invest in Japanese Corporations

20

Hostile approach should be avoided

Strategic partnership on core business should be emphasized – “strategically focused”

Ideally, a substantial local presence should be established as a first step – “be patient”

Continue analyzing and communicating with target companies to determine the best timing for approach

Key Approach to M&A in Japan

21

How do Japanese companies currently view M&A?

Tool to achieve “Selection & Focus” policy for improvement of ROI 　 Method for obtaining required resources (e.g. operational assets and human resources) required for growth Method to provide investors with good exit

Always target a win-win scenario between seller and buyer （ Value for seller ＜ FMV ＜ Value for buyer ）

Furthermore, structure M&A as substantially beneficial for shareholders of both companies and employees and all the other stakeholders of target companies, ideally including its customers and vendors

Continuous strategic approach and message to top management of target company based on the clear view and strong commitment to realize proposed synergy

Desirable M&A for Japanese Companies

22

GCA Group Overview

23

Organization

GCA was established in 2004 in response to the recognized need in the Japanese marketplace for conflict-free, unbiased M&A advisory services. GCA ranks consistently on league tables and earned the #1 spot for Japan related transactions in Q12007.GCA America, a wholly owned subsidiary of GCA, was established in 2007 in response to the demand for cross-border M&A services by GCA clients. GCA America has offices in both New York and San Francisco.

Mezzanine Corporation (“MCo”) is the first independent, full-fledged mezzanine fund in Japan

MCo, with raised capital of JPY68.7billion, was established to identify investment opportunities that yield superior returns. MCo’s competitive advantage lies in its strong deal sourcing network and superior structuring capabilities.

Due Diligence Corporation (“DCo”) is an independent M&A due diligence company

While other institutions, such as large accounting firms, are often unable to meet the needs of their clients due to conflicts, DCo is able to respond to client requests quickly and offer superior highly confidential due diligence services. In order to fully meet and exceed client expectations and ensure client success, DCo offers value-added services throughout the process and after the close of the transaction.

GCA Holding Corporation (“Holdings”) enables both the M&A Advisory Group and the Investment Group to better serve both clients and investors.

Under the management principle of For Client's Best Interest, Holdings lets its affiliated companies provide the best quality M&A solutions more effectively.

24

Despite having been founded in 2004, the high demand for GCA’s services allows GCA to consistently ranks high on the league tables due to strong demand for independent M&A Advisory Services.

Position in the Japanese Market

Any Japanese involvement Announced1/1/2007 – 6/30/2007

1/1/2006 - 12/31/2006

Financial AdvisorTransaction

Value US$m RankMkt.

ShareNo.

Deals

Citigroup 38,239.1 1 29.6% 27

Goldman Sachs & Co 37,141.6 2 28.8% 25

Nomura 36,364.2 3 28.2% 122

UBS 34,662.9 4 26.9% 22

Daiwa Securities SMBC 31,616.5 5 24.5% 114

Mizuho Financial Group 26,284.5 6 20.4% 101

Merrill Lynch 20,801.2 7 16.1% 18

Deutshce Bank AG 18,146.4 8 14.1% 4

KPMG FAS 16,558.6 9 12.8% 34

JP Morgan 11,691.4 10 9.1% 8

Morgan Stanley 10,815.5 11 8.4% 14

Rothschild 9,077.2 12 7.0% 5

Mitsubishi UFJ Financial Group 7,787.2 13 6.0% 139

GCA 6,807.8 14 5.3% 14

Credit Suisse 6,713.9 15 5.2% 7

Source: Thomson Financial

Any Japanese involvement Completed1/1/2006 - 12/31/2006

Any Japanese involvement Announced1/1/2007 - 12/31/2007

1/1/2007 - 12/31/2007

Financial AdvisorTransaction

Value US$m RankMkt.

ShareNo.

Deals

Nomura 34,468.8 1 22.4% 155

Citigroup 23,032.6 2 15.0% 96

GCA 21,966.5 3 14.3% 25

Merrill Lynch 21,133.8 4 13.7% 20

Goldman Sachs & Co 18,965.2 5 12.3% 31

Mitsubishi UFJ Financial Group 18,394.1 6 12.0% 113

Morgan Stanley 17,502.7 7 11.4% 29

Mizuho Financial Group 16,020.8 8 10.4% 101

Daiwa Securities SMBC 15,077.4 9 9.8% 130

JP Morgan 14,032.3 10 9.1% 23

KPMG Corporate Finance 11,265.4 11 7.3% 42

Lehman Brothers 10,887.5 12 7.1% 15

UBS 10,320.3 13 6.7% 28

Credit Suisse 6,301.9 14 4.1% 7

Deutshce Bank AG 5,611.7 15 3.7% 17

Source: Thomson Financial

25

Mergers/Acquisitions

Divestitures

Joint Ventures and Strategic Alliances

Going Private Transactions

Management Buy Outs

Leveraged Buyouts

Cross-Border Transactions

Distressed M&A

Corporate Restructuring

Take Over Bid Defense

M&A Strategic Alternatives Assessment

M&A/IPO Analysis

Valuation

Due Diligence

Tax Planning

Fairness Opinions

Investor Relations Planning

Post Merger Integration

M&A Advisory Financial Advisory Services Capital Markets Advisory

M&A Financing

Capital Structure Assessment

Capital Sourcing

Senior debt

Subordinated debt

Preferred stock

DIP Financing

GCA offers both investment banking as well as transaction related financial advisory services. GCA’s goal is to meet all of its clients transaction needs.

GCA Business Lines

Buyside41%

Other7%

Restructuring 4%

MBO 3%

Hostile Takeover Defense 10%

Structuring5%

Sellside16%

Corporate Valuation

14%

Transaction Type

26

June, 2007

Advised Ricoh

and

Formation of Joint Venture between Business merger between

June, 2007

Advised ORIX Corporation

and

Oct, 2006

Advised Hurxley Co., Ltd.

Share acquisition of

TRN Corporation by

Acquiring

September, 2006

Advised J:com

Selling LPG business under Civil Rehabilitation Law to

February, 2007

Advised Asamizu Corporation

Asamizu Corporation

MBO & Going Private by managements of OMRON

ENTERTAINMENT

February, 2007

Advised FURYU HD, a SPC for the MBO Advised Mercian

Acquisition of

Jun, 2006

Advised Fusen-usagi Corporation

by

June, 2006

HANSHIN ELECTRIC EAILWAY

Management integration between

and

Advised Hankyu Holdings

Implementing defense practice on hostile takeover

December, 2006

Advised Matsuzakaya

Acquiring

September, 2006

Advised Itochu Enex

Capital participation to

Sep, 2006

Advised Kasco Corporation

by

Equity and business alliance between

January, 2007

and

Advised Miyano Machinery

Business tie-up and TOB to

December, 2006

by

Share acquisition of

December, 2006

Advised Tokyu

Valuation for sales of resort business from Daiwa House Industry Co., Ltd.

to Daiwa Resort Co., Ltd.

Advised Daiwa House Co., Ltd.

Mar, 2007

TOB of the Common Stock of

by

Mar, 2007

Advised Nikko Cordial Corporation

Provided valuation and merger ratio calculation report for the merger

between

In Progress

Advised Shinko Securities

Formation of Joint Venture between

May, 2007

Advised Kato Works Co., Ltd

and

Arrangement of third party allotment of

July, 2007

Advised Kenwood Corporation

Acquisition by

June, 2007

Advised Itochu Corporation

Divestiture and sale of nursing home business of

August, 2007

Advised Green Tokyo Co., Ltd.

Acquisition of

August, 2007

Advised Alfresa Holdings Corporation

to by

ofto Kenwood Corporation and

SPARX International

Purchasing for subsidiary’s shares by Citigroup （ Triangular merger)

Advised Nikko Cordial Group

October, 2007

Mitsubishi Material Regarding restructuring of Mitsubishi Material’s

two subsidiaries

October, 2007

Advised Mitsubishi Shindoh Co.,Ltd. & Sambo Copper Alloy Co., Ltd..

GCA Representative Transactions

27

Selling a stake in

February, 2006

to Vivendi Universal

Advised Panasonic

Sale of Keiyu share`s by former management team of Keiyu Co.

Advised Keiyu`s former 　　 management team

Dec, 2005

Acquisition of Computer City Co., Ltd.by

Advised Infocom Corporation

Jun, 2005

株式会社コンピュータシティ

MBO & Going Private by the management of World Co., Ltd

July, 2005

Advised World’s management

Revitalized by

March, 2005

Advised Panasonic

Acquiring

August, 2005

Advised The Carlyle Group

Acquisition of oil business of Kokura Enterprise Co., Ltd.

Advised Itochu Enex Co., Ltd

Jul, 2005

小倉興産株式会社

Acquisition of Calsonic Communication Co., Ltd.

by

Advised Calsonic Kansei Co., Ltd.

Jul, 2005

カルソニックコミュニケーション

May, 2005

and

Management integration between

Advised Takara

Acquiring capital in

December, 2005

Advised Itochu Corp.

Acquiring capital in

April, 2005

Advised All Nippon Airways

March, 2006

Advised Itochu Corp.

Selling a stake in

to parent company

Group reorganization of listed three group companies to wholly-owned

subsidiaries of Daiwa House

March, 2006

Advised Daiwa’s subsidiaries

Acquiring

February, 2006

Advised Itochu Corp.

Acquiring

April, 2006

Advised Panasonic

May, 2005

Advised Takara Co., Ltd.

Arrangement of third party allotment of

Shares in

June, 2006

To be made a wholly-owned subsidiary of

Advised Nitto Denko

KYOSHIN Co.,

June, 2006

Advised Fujinon

To be made a wholly-owned subsidiary of

GCA Representative Transactions

28

GCA / Savvian Merger Announced

On November 1, GCA and Savvian announced a merger of equals transaction with the intention to form a premier global strategic advisory firm

Will maintain listing on the Tokyo Stock Exchange Well-capitalized balance sheet Pro forma market capitalization of almost ¥200 billion

Strategic step by both firms to leverage each company’s strengths and capitalize on the anticipated increase in cross-border merger activity between Japan, the United States and Europe

Access to leading companies in Japan, the United States and Europe Technical M&A know-how in Japan, the United States and Europe Unique cross-border transaction experience

Continued trusted advisor approach for client’s best interest

Long-term approach to relationships Serve as strategic advisor Deliver the best professionals and creativity Operate without conflicts of interest Always put the client’s interests first

29

Senior Team with Unparalleled Transaction Experience

Highest Quality Client Service

Broad Network Including Fortune 500 Relationships

M&A Advisory and Capital Raising Expertise

Bulge BracketTransaction Expertise

Growth Company Focus

Sector Expertise / Domain Knowledge

Relationships with entrepreneurs

Relationships with VC and PE firms

Private Capital Access

Late Stage Private through Public Company Orientation

Growth Sector Focus

Savvian Advisors Overview

Savvian has a unique set of skills and industry knowledge

30

* Flag icon on left represents Savvian Advisors, LLC client

March 2006We advised the seller

Acquired by

Acquired by

November 2005We advised the sellerWe advised the seller

Acquired by

August 2005 April 2005We advised the seller

Acquired byStrategic IP License with

January 2005 December 2004We advised the seller

Acquired by

March 2004We advised the buyer

Acquisition of

Closed / Announced Cross Border Transactions

October 2007We advised the seller

Divestiture of CellPhone Distribution

Business

October 2007We advised INTAC

Merger with

November 2006We advised the buyer

Acquisition of

Acquired by

We advised the sellerOctober 2006March 2007

Sale of Semiconductor Automatic Test Equipment

Assets to

We advised the sellerApril 2007

We advised the seller

Acquired by

May 2007We advised the seller

Acquired by

July 2007We advised the seller

Acquired by

April 2007We advised the seller

Divestiture of Cleanroom Integrated Solutions Business

July 2007We advised the seller

Acquired byAcquired by

We advised the sellerPending

Savvian Advisors Overview

31

GCA/ Savvian Integration - Increase in EPS

Proforma EPS (assuming integration would be made as of March 2007)

GCA

2/2008 （ Forecast)

Sales (Mil. Yen)

Net Income (Mil. Yen)

Number of issued shares

EPS (Yen)

7,109

1,791

184,920

9,686

Savvian

12/2007 （ Forecast)

6,217

1,691

151,299

11,178

Combined

2/2008 （ Forecast)

13,326

3,482

336,219

10,358

EPS increase 9,686 → 10,358 (7%)

＋ ＝

Note: GCA 2/2008 forecast = Fund Consolidated base. Exchange-rate : Yen115/US$

32

Nick Masuto, GCA America President [NY] nmasuto@gcaamerica.com 212-551-1447

Mr. Masuto is President & CEO of GCA America Corporation, a wholly-owned U.S. subsidiary of GCA Co. Ltd. and is currently based in New York. For over 20 years, Mr. Masuto has been involved in a wide range of corporate finance activities including investment banking, private equity and structured financing in Japan, the U.S. and Europe. He has extensive experience in advising on M&A, IPO, private placement and LBO financing transactions and also has principal experience in equity and mezzanine investments. He has led the origination and execution of both cross-border M&A transactions as well as Japanese domestic deals.

Recently, Mr. Masuto represented All Nippon Airways in its investment in Skynet Asia Airways, the management team of Omron Entertainment Inc. in its MBO, and Matsuzakaya (a major Japanese department store) in its corporate defense actions against a hostile takeover by an activist fund. He has also led many successful large scale cross-border M&A transactions including TDK Co. Ltd.’s acquisition of Silicon Systems (a U.S. semiconductor manufacturer acquired through TOB), Sumitomo Heavy Industries’ acquisition of Lumonics (a Canadian laser technology company acquired through TOB), a Japanese trading company’s acquisition of Argo-Tech (a U.S. aircraft pump manufacturer through a consortium with Vester Capital) and Nippon Paint’s shareholding realignment with its U.S. joint venture partner.

Prior to joining GCA, Mr. Maputo worked at Ripplewood Japan where he was responsible for origination and execution of buyout transactions. He was also heavily involved in post-acquisition management through his management roles in Ripplewood portfolio companies. Prior to joining Ripplewood, Mr. Masuto worked as an investment banker for Daiwa Securities and Sumitomo Bank (currently known as Sumitomo Mitsui Banking Corporation) Tokyo. During his career, he had the opportunity to establish Japan Equity Capital Inc., a private equity firm sponsored by Daiwa Securities SMBC, Sumitomo Corporation and GE Capital. Additionally, with Sumitomo, he spent over 8 years in London, focusing upon cross-border M&A transactions between Europe and Japan/U.S. and structured finance transactions for U.K. and Swiss blue-chip companies and municipals. He also spent time in the U.S., having been seconded to Robertson Stephens & Co. in San Francisco where he focused on the technology sector investment banking.

He is a visiting instructor at Kobe University’s business school and often is a speaker at M&A and private equity related seminars. He holds the Authorized Sales Representative and Internal Administrator certification issued by the Japanese Securities Dealers Association (“JSDA”) and the Financial Services Authority (“FSA”) in the U.K．Mr. Masuto completed his Masters in Finance degree at the London Business School, University of London, and received his undergraduate degree from Keio University, where he majored in Law.

Selected Biographies

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Tracy Gopal, Director [SF] tgopal@gcaamerica.com 415-205-0721

Ms. Gopal has been providing transaction advisory services to clients for over 9 years and currently focuses upon origination and execution of cross-border transactions. She assists Japanese companies in identifying and purchasing assets in the United States and assists Japanese companies, US companies and private equity firms in purchasing or divesting Japanese assets. Ms. Gopal also has significant experience in financial restructuring, having worked with a significant number of distressed clients both in and out of court. She has represented both debtors and creditors and has special expertise in valuing distressed companies.

Ms. Gopal advised the secured creditors in the Refco Inc. bankruptcy, which was the at the time of the filing, the 4 th largest bankruptcy in U.S. history. She has advised numerous management teams prior to and throughout the chapter 11 process, including Borden Chemicals and Plastics, WestPoint Stevens, Hawaiian Airlines, and the Polymer Group. She has prepared valuation testimony and fairness opinions for several clients which cannot be disclosed.

Prior to joining GCA, Ms. Gopal worked for Giuliani Capital Advisors, formerly the Ernst & Young Corporate Finance practice. While at Ernst & Young, she was seconded to the Tokyo Asia Pacific Solutions Group in Tokyo, advising a major bank in Japan on the valuation of non-performing loans. She began her career with Arthur Anderson in the area of international trade and customs.

Teruyasu Kushima, Associate Director [NY] tkushima@gcaamerica.com 212-551-1448

Mr. Kushima joined GCA in 2005 and is now an Associate Director at the New York Branch of GCA America Corporation. He frequently advises Japanese companies in connection with their cross-border transactions and provides services including origination, structuring and valuation.

Prior to joining GCA, he was an Assistant Director with Japan Bank for International Cooperation (JBIC) where his practices included various cross-border structured finance and project finance for large transportation and energy projects in Eastern Europe, Russia and Latin America. During his career at JBIC (formerly Export Import Bank of Japan) he was seconded to Paris-based Organization for Economic Co-operation and Development (OECD) where he worked as a consultant to their Trade Directorate. He received his B.A in Economics from Keio University. He is fluent in English and French.

Selected Biographies