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July 31, 2008
ACCA Networks Co., Ltd.
(Security Code 3764, JASDAQ)

eAccess Ltd.
(Security Code 9427, 1st section of the Tokyo Stock Exchange)

ACCA Networks and eAccess Agreed on Business and Capital Alliance

Following the resolutions of their board of directors meetings held today, ACCA Networks Co., Ltd. (hereinafter referred to as "ACCA", headquarter: Chiyoda-ku, Tokyo, Representative Director & President: Isamu Suyama) and eAccess Ltd. (hereinafter referred to as "eAccess", headquarter: Minato-ku, Tokyo, Representative Director & President: Koji Fukata) agreed on strategic business and capital alliance for the future business integration. The details are as follows:

1. Purpose and Reason of this Alliance
In the rapidly expanding broadband industry, ACCA and eAccess have expanded their operating bases at high speed through providing DSL services. While DSL remains as a primary service of broadband market, representing a majority of the market shares, recent years we have seen the diversification of services in the broadband market. Considering these market circumstances, the two companies, who operate under a common business model, i.e., wholesaling DSL service to ISPs, reached the agreement on this alliance with common understanding that, as a result of the consolidated integration of DSL assets and services, the both companies can maximize their profits by improving business efficiency, enhancing the competitive position, and strengthening the balance sheets as a basis for the ongoing expansion in the future. As for the future prospect, we expect this alliance to contribute to the implementation of new business model and enable the discussion for expansion of business domain. Upon this alliance, ACCA and eAccess will become the industry's No.2* DSL service provider with approximately 22% market share.

* The figures are based on that NTT East and NTT West are counted as separate enterprises as of March 2008.

2. Summary of this Alliance

(1)Business Alliance
(i)Consolidation of DSL Related Assets and Network Maintenance Operation
eAccess will transfer DSL related assets ACCA and consolidate the network maintenance operation with ACCA to improve business efficiency. eAccess shall lease back the facilities from ACCA and continue to provide the DSL services.

* For details of the assignment of DSL facilities, please refer to "Notice Regarding Acquisition of Fixed Assets" separately issued by ACCA and "Notice Regarding Assignment of Fixed Assets" separately issued by eAccess as of today.
(ii)Integration of Network Operation
ACCA will integrate its network maintenance operation with EMOBILE Ltd. which is an equity method affiliate of eAccess to improve business efficiency and cost reduction through taking advantage of scale merits. (eAccess has already assigned its network operation service to EMOBILE Ltd.)
(iii)Integration of Three Backyard Businesses
eAccess will transfer its DSL modem rental, distribution and operation, and customer support service to ACCA and integrate with ACCA's service for the purpose of improvement of efficiency and cost reduction.

Through these alliances above we expect a synergy of 14 billion yen revenue contribution to ACCA and to achieve a cost reductions of 6 billion yen for ACCA and approximately 1 billion yen for eAccess, in aggregate, for the next 5 years. These will be the first phase of the expected synergy effects and both companies will aim at enhancing further synergy effects throughout the future process of business integration.

The details of these business alliances will be determined upon discussion at the Committee of Business Alliance (tentative name, hereinafter the same). Further, in order to ensure the business integration described above be implemented smoothly, the both companies will exchange human resources through mutual transfer of relevant employees on secondment (shukko) basis.
(2)Capital Alliance for Promotion of Business Integration
ACCA and eAccess agreed that ACCA will issue 61,790 shares of common stock to eAccess in order to enhance this business alliance. After such issue of new shares, eAccess will hold approximately 45.3% of the total voting rights in ACCA. As a result, ACCA is expected to become a consolidated subsidiary of eAccess.
Further, following the resolution of the extraordinary shareholders meeting of ACCA to be held in October, eAccess plans to nominate new directors to ACCA who will constitute a majority of the Board members of ACCA.
Through this capital alliance, ACCA shall raise fund for purchasing the DSL facilities as a foundation of this business alliance and for investments in a growing business for the future (including without limitation, MVNO service).

*For details of terms and conditions of issue of shares, please refer to "Notice Regarding Issuance of New Shares by Third-Party Allocation" released by ACCA as of today. Further, for details of changes in capital relationship, please refer to "Notice Regarding Change of Parent Company" separately released by ACCA and " Notice Regarding Acquisition of Shares of ACCA Networks and Change in Subsidiary" released by eAccess as of today.

eAccess will keep intact the company name, service brand, management organization, employees and operating bases of ACCA, after it becomes a consolidated subsidiary of eAccess. Further, eAccess shall offer utmost cooperation in order that ACCA, as a listed company, will continue to maintain and expand its corporate value through independent and efficient management, and thereby maximize the synergy of the group.
3Future Prospect
ACCA and eAccess will accelerate the reduction of the cost, improve the profitability and strengthen the balance sheet, and promote effective and strategic investments in strong business sectors of the companies to realize the sustainable growth. Moreover, the both companies will discuss implementation of new business model (including without limitation, MVNO service, FMC service and transmission network operation service or device supply service for such service industries) and expansion of services in other business fields.
4Outline of the Companies
[ACCA Networks Co., Ltd.]
(1) Company name: ACCA Networks Co., Ltd.
(2)Main business: Telecommunication
(3)Established: March 15, 2000
(4)Principle office: 12-1, Yurakucho 1-chome, Chiyoda-ku, Tokyo
Representative: Representative Director and President Isamu Suyama
Paid-in capital: JPY 12,986 million (as of December 31, 2007)
Number of employees: 335
(8) Major shareholders and percentage of shares held:
eAccess Ltd.14.9%
NTT Communications Corporation12.9%
Ignite BB Investments L.P.8.8%
Daiwa Securities Group Inc.4.2%
IT2000 Investment Business Limited Liability Partnership3.4%
(9) Relationship with eAccess Ltd. (as of June 30, 2008)
Capital Relationship:eAccess holds 16,785 shares of ACCA.
Personnel Relationship: None
Business Relationship:EMOBILE Ltd., an equity-method affiliate company of eAccess, entered into the Mobile Date Communication Service Agreement with ACCA.
[eAccess Ltd.]
(1) Company name: eAccess Ltd.
(2)Main business: Telecommunication
(3)Established: November 1, 1999
(4)Principle office: 10-1, Toranomon 2-chome, Minato-ku, Tokyo
Representative: Representative Director and President Koji Fukata
Paid-in capital: JPY 17,101 million (as of March 31, 2008)
Number of employees: 364
(8) Major shareholders and percentage of shares held:
Morgan Stanley&Co. International PLC17.7%
Sachio Semmoto7.0%
The Master Trust Bank of Japan (Trust Account)6.7%
Eric Gan6.5%
Goldman Sachs and Company Regular Account4.6%
(9) Relationship with ACCA Networks Co., Ltd. (as of June 30, 2008)
Capital Relationship:eAccess holds 16,785 shares of ACCA.
Personnel Relationship: None
Business Relationship:EMOBILE Ltd., an equity-method affiliate company of eAccess, entered into the Mobile Date Communication Services Agreement with ACCA.
July 31, 2008Resolution by the board of directors of the both companies, and execution of investment and asset assignment agreement
August 15, 2008eAccess to complete payment for the issue of new shares by ACCA to eAccess (scheduled)
September 1, 2008Assignment of DSL assets (scheduled)
October 1, 2008Extraordinary shareholders meeting of ACCA (scheduled)
6Financial Forecasts
[ACCA Networks Co., Ltd.]
Consolidated financial forecast for the year ending December 31, 2008 (FY2008)
forecast (A)
forecast (B)
Consolidated Sales31,000 million31,000 million 0
Consolidated Operating Profit1,900 million2,000 million +100 million
Consolidated Ordinary Profit1,900 million2,000 million +100 million
Consolidated Net Profit1,400 million1,700 million +300 million
[eAccess Ltd.]
Financial forecast for the year ending March 31, 2009 (FY2008)
forecast (A)
Forecast (B)
Revenue80,000 million80,000 million 0
Operating Profit12,700 million12,800 million +100 million
Recurring Profit10,700 million11,000 million +300 million
Net Income6,500 million6,600 million +100 million
Annual dividend per share2,3002,3002,300
Consolidated financial forecast for the year ending March 31, 2009 (FY2008)
forecast (A)
Revised (B)Increase/decrease
Consolidated Revenue80,000 million95,000 million +15,000 million
Consolidated Operating Profit12,700 million13,800 million +1,100 million
Consolidated Recurring Profit-6,100 million-5,000 million +1,100 million
Consolidated Net Income-10,300 million-9,800 million +500 million
(Note)These financial forecasts have been prepared on the assumption that eAccess will consolidate ACCA's business results on and after September 1, 2008.

The information is true and accurate at the time of publication. Price, specification, contact and other information of products and service may be subjected to change.