Farallon Capital Management Publishes Results of Perception Study on T&D Holdings, Inc.

SAN FRANCISCO--(BUSINESS WIRE)--Farallon Capital Management L.L.C. ("Farallon") today released the results of a perception study of the shareholders and sell-side analysts of T&D Holdings Inc. ("T&D HD" or the “Company”) conducted by an independent global research firm (“Perception Study”).

Farallon first became a shareholder of T&D HD in 2008 and has continued to engage constructively with T&D HD management and Board of Directors. Farallon has requested that the Company accelerates its transformation by pursuing bold reforms to enhance corporate value and by further deepening “EV-based management” as a core framework for capital allocation.

Through this dialogue, Farallon concluded that it is important for the management and Board of T&D HD to understand how the Company is objectively viewed by the market and therefore commissioned the Perception Study.

The full Perception Study is available at: https://www.faralloncapital.co.jp/engagements
A summary of the key findings of the Perception Study is as follows.

Theme	Summary Results of the Perception Study
Profitability of Taiyo Life	92% of respondents expressed serious concerns about Taiyo Life's supervisory oversight Respondents stressed the need for a fundamental review of Taiyo Life's business model
Capital Efficiency	75% of respondents were dissatisfied with Board oversight of capital efficiency, calling for bolder and faster equity risk reduction and a review of capital allocation Not a single respondent viewed the Board's oversight of capital efficiency as adequate
Governance	75% of respondents believe T&D HD’s management is not sufficiently independent from its operating subsidiaries to be able to make objective and rational decisions Respondents were particularly concerned that the presidents of Taiyo Life and Daido Life also serve as directors of T&D HD
Upcoming Long-Term Vision KPIs	67% of buy-side respondents support maintaining the P/EV multiple as a management objective in the next Group Long-Term Vision Market participants continue to favor “EV-based management” and want to see clearer economic value-based KPIs

Farallon’s Expectations for the Next Group Long-Term Vision

Farallon believes the Board and management have a responsibility to take the Perception Study’s findings seriously and position the following three points as clear objectives in developing the next Group Long-Term Vision:

1. Review Taiyo Life's business model to improve profitability
   • Conduct a strategic review of the bank channel (curbing sales of low-return savings products and consolidating bank-channel operations with TDF)
   • Optimize the cost structure by curbing salesforce expansion, consolidating branches, and targeting meaningful operating expense reductions
2. Emphasize “EV-based management” and further improve capital efficiency
   • Accelerate reduction of equity risk by conducting a meaningful reduction of cross-shareholdings
   • Improve return-over-risk at operating subsidiaries through rigorous segment/product reviews and reallocating capital away from low-return or high‑risk products
   • Strategically use reinsurance, proactively reinsuring in-force savings-type policies with low risk‑adjusted returns
3. Reassess Group governance
   • Discontinue the dual roles of the Taiyo Life and Daido Life presidents as T&D HD directors
   • Establish a committee consisting solely of outside directors of T&D HD who are independent of its operating subsidiaries

Farallon hopes that the Perception Study will help T&D HD to develop a more robust next Group Long-Term Vision and governance structure. Farallon intends to continue its constructive dialogue with the Company to enhance T&D HD's long-term corporate value.

About Farallon

Farallon Capital Management, L.L.C., is a global investment firm founded in 1986 and registered as an investment adviser with the United States Securities and Exchange Commission since 1990. Farallon seeks investments across asset classes and around the world through a process of bottom-up fundamental research and analysis emphasizing capital preservation. More information on Farallon is available at www.faralloncapital.com.

Disclaimer

This press release is for general information purposes only and is not complete. Under no circumstances is this intended to be, nor should it be construed as an offer, invitation, marketing of services or products, advertisement, inducement or representation of any kind, nor as investment advice or a recommendation to buy or sell any investment products or make any type of investment in securities. This press release should not be construed as legal, tax, investment, financial or other advice. Additionally, this press release should not be construed as an offer to buy any investment in any fund or account managed by Farallon Capital Management L.L.C. or any of its affiliates or representatives (collectively, "Farallon").

The Perception Study was conducted by an independent global research firm retained by Farallon for a fixed fee with no performance or outcome-linked consideration.

This press release is not intended and should not be considered to solicit, encourage, induce or seek T&D HD shareholders to authorize Farallon or any other third party as their proxy in exercising their voting rights on their behalf. Farallon is not soliciting or requesting other shareholders of T&D HD to jointly exercise their shareholders' rights with Farallon (including, but not limited to, voting rights). Farallon declares that it does not intend to be treated or deemed a "joint holder" (kyo-do hoyu-sha) under the Japanese Financial Instruments and Exchange Act or a "related person" (kankei-sha) under the Foreign Exchange and Foreign Trade Act with other T&D HD shareholders.

Farallon does not have the intention to make a proposal, directly or through other shareholders of T&D HD to transfer or abolish the business or assets of T&D HD and/or T&D HD group companies (the T&D HD Group) at the general shareholders meeting of T&D HD. Farallon does not have the intention and purpose to engage in any conduct which constricts the continuing and stable implementation of the businesses of any member of the T&D HD Group.

This press release is made available exclusively by Farallon and not by or on behalf of T&D HD or its affiliates or subsidiaries or any other person. Farallon is not an affiliate of any member of the T&D HD Group and neither Farallon nor its principals or representatives are authorized to disseminate any information for or on behalf of any member of the T&D HD Group; nor does Farallon purport to do so.

In respect of information that has been prepared by Farallon (and not otherwise attributed to any other party) and which appears in the English language version of this press release, in the event of any inconsistency between the English language version and the Japanese language version of this press release, the meaning of the Japanese language version shall prevail unless otherwise expressly indicated.