Strategic Capital Co., Ltd. Announces Shareholder Proposals to Nippon Steel Corporation and Osaka Steel Co., Ltd. and Planned Launch of Special Website on the Proposals

Our company has entered into a discretionary investment management agreement with INTERTRUST TRUSTEES (CAYMAN) LIMITED SOLELY IN ITS CAPACITY AS TRUSTEE OF JAPAN－UP (hereinafter referred to as the "Fund"). The Fund and our company (hereinafter collectively referred to as "SC" or the "Proposing Shareholder") are shareholders of Nippon Steel Corporation (hereinafter referred to as "Nippon Steel") and its listed subsidiary, Osaka Steel Co., Ltd. (hereinafter referred to as "Osaka Steel").

Nippon Steel and Osaka Steel are both listed companies, maintaining a parent-child listing structure. Over the past year, while Nippon Steel fully acquired its formerly listed subsidiaries, Sanyo Special Steel Co., Ltd. and Kuroda Harima Co., Ltd., it also partially sold its shares in Osaka Steel. This inconsistent approach suggests a lack of coherent policy regarding the ownership of listed subsidiaries, with no apparent discussions on the matter.

Considering Nippon Steel's actions, it can be inferred that Osaka Steel is a subsidiary of low importance to Nippon Steel, yet both companies insist on maintaining Osaka Steel's listed status. Furthermore, Osaka Steel has consistently traded below a PBR of 1x. If it is to maintain its listed status, drastic management reforms are urgently needed. However, with Nippon Steel still holding a majority of voting rights, Osaka Steel has not moved to escape its state of continuous impairment of shareholder value.

In light of this situation, SC has sent documents to both companies this time to exercise shareholder proposal rights at their ordinary general meetings scheduled for June, and hereby announces this matter as described below.

A special feature website, scheduled to launch on May 11th, will provide detailed explanations of the background and content of the proposals. The launch of this special feature website will be announced on our company's homepage (https://stracap.jp/).

Shareholder Proposal Agenda and Overview for Nippon Steel

Agenda 1: Amendment to the Articles of Incorporation regarding the establishment of a Listed Subsidiary Strategy Review Committee

(Overview) To establish a committee to deliberate on policies for holding listed subsidiaries.

Shareholder Proposal Agenda and Overview for Osaka Steel

Agenda 1: Acquisition of treasury shares from specific shareholders

(Overview) To acquire all Osaka Steel shares held by Nippon Steel as treasury shares at a price not particularly advantageous to other shareholders.

Agenda 2: Disposition of surplus funds

(Overview) To pay an 8% DOE (Dividend on Equity) dividend.

(Attached Materials)

Full text of the agenda proposed to Nippon Steel and Osaka Steel and full text of the reasons.

d52343-120-49d185b2a08471e1deabf6a7cb118995.pdf

Strategic Capital Co., Ltd.

We aim to improve corporate and shareholder value through dialogue with company management and the exercise of shareholder rights. Keywords: