Implementation of the Tender Offer for the Company Shares, Etc. by DigitalBridge Strengthening the management base to establish an infrastructure sharing market in Japan and contributing to the development of the telecommunications industry

DigitalBridge Group, Inc. (including affiliates and other related entities; “DigitalBridge”) has announced today that it will, through DB Pyramid Holdings, LLC acquire common shares of JTOWER Inc. (the “Company”) and the Stock Acquisition Rights of the Company through the tender offer (the “Tender Offer”) under the Financial Instruments and Exchange Act (Act No. 25 of 1948, as amended). At the same time, the Company also adopted at its board of directors meeting held today a resolution to the effect that it shall express its opinion in support of the Tender Offer by DigitalBridge, and that it shall recommend that its shareholders tender their shares in the Tender Offer and that it shall leave to the Stock Acquisition Rights Holders the decision on whether or not to tender their Stock Acquisition Rights in the Tender Offer.

Background: The growing need for infrastructure sharing requires strengthening the management base for continued business expansion
In the Japanese telecommunications industry, in addition to the deployment of new communication technologies for Beyond 5G and 6G, the burden on telecommunications carriers is expected to continue to increase due to the expansion of the coverage area required not only for disaster response and rural areas on land, but also for the sky, sea, and outer space. In addition, as the population continues to decline, a major issue is how to maintain and operate communication infrastructure in a stable manner with limited human resources.
In this context, there is a growing need to improve the efficiency of indoor and outdoor network development and the maintenance and operation of communication infrastructure through infrastructure sharing, and the Company believes that the existence of infrastructure sharing business operators with sufficient systems and technical capabilities to take on this role is essential for the development of the telecommunications industry.
The Company Group’s capital investment and system reinforcement in the indoor infrastructure sharing business and tower business, both of which are core businesses of the Company, as well as initiatives to upgrade the sharing area, will require responding flexibly to future additional funding needs and making up-front investments from a long-term perspective.
However, in the stock market, there is a possibility of restrictions on raising funds due to share price conditions, and there is a strong tendency to prioritize short-term profitability, which makes it difficult to make up-front investments for future growth.
The Company has received representations from DigitalBridge that it is prepared to provide additional equity capital required to fully support the growth of the Company Group after the Company goes private through the Tender Offer, and through the Tender Offer, we expect that we will be able to raise funds for growth in an agile and stable manner from DigitalBridge. As a result, we will be able to respond flexibly to future additional funding needs and make up-front investments from a long-term perspective, thereby appropriately being able to seize growth opportunities in the infrastructure sharing market and further increase the speed of business growth.
Against such background, the Company has decided this time to strengthen its management base by adding DigitalBridge as our new partner to contribute to the development of the Japanese telecommunications industry by establishing an infrastructure sharing market as a pioneer of infrastructure sharing in Japan.

Regarding DigitalBridge: A leading, global-scale digital infrastructure investment firm with approximately $84.5 billion in managed asset under management globally. ^*1
DigitalBridge is a leading, global-scale digital infrastructure investment firm based in the U.S. with approximately $84.5 billion in managed assets under management globally. It has a heritage of over 25 years in the digital infrastructure business, including cell towers, data centers, fiber, small cells (small base station), and edge infrastructure. DigitalBridge and its telecommunications tower portfolio companies have been value added partners to many MNOs*3, including through the delivery of large-scale BTS*2 programs. DigitalBridge has extensive expertise in operations, financing, development, and mergers and acquisitions (M&A) within the telecommunications tower sector.
In addition, DigitalBridge has extensive knowledge in taking digital infrastructure companies private, and in every project it has worked on, DigitalBridge partnered with existing management teams and employees, receiving active support from the target company’s key clients. After privatization, DigitalBridge was successful in accelerating the growth of these businesses through strategic value added initiatives and robust capital support.

*1　AUM as of June 30, 2024, and inclusive of portfolio companies in which DigitalBridge Group, Inc. (”DBRG”) has invested from its balance sheet (either directly or indirectly through an investment vehicle managed by a subsidiary of DBRG) or for which a subsidiary of DBRG provides investment advisory services. Includes AUM of non-digital portfolio companies under the InfraBridge platform.
*2　BTS: Built-to-suit. “BTS program” means a program in which infrastructure facilities that are customized to align with the needs and requirements of specific telecommunications companies and clients are designed and built.
*3　MNO: Mobile network operators. “MNO” means an entity which has its own telecommunication channels for mobile use and that provides data transmission services.

Capital structure, management policy and major alliances, etc. after the Transaction
In the event of the consummation of the Tender Offer (including when the Squeeze Out Procedures are implemented), the shareholders of the Company will only be a U.S. subsidiary of DigitalBridge and Cultive, Inc (an asset management company of Atsushi Tanaka, Representative Director and President of the Company).
Furthermore, even after the Tender Offer is consummated, the current management structure of the Company will be maintained in principle, and the current management, including Atsushi Tanaka, will continue to lead the Company’s management. In addition, the Company will maintain its business alliance with existing capital and business alliance partners Nippon Telegraph and Telephone Corporation, NTT DOCOMO, INC., and KDDI CORPORATION even after the consummation of the Tender Offer, and will strive to improve and innovate the services so that the Company can provide additional value to all mobile carriers and other users of the Company services.
Through execution of the Tender Offer, the Company aims to further expand its business by maximizing the use of DigitalBridge’s capital, global industry knowledge, and network, etc. to enhance its corporate value.

[Upcoming schedule for the Tender Offer]
The upcoming schedule for the Tender Offer is as follows:
Date of public announcement: 2024/8/14 (Wed)
Tender Offer Period: 2024/8/15 (Thu) to 2024/10/10 (Thu)
Commencement date of settlement: 2024/10/18 (Fri)

For details, please check “Notice Regarding Expression of Opinion in Support of the Tender Offer for the Company Shares, Etc. by DB Pyramid Holdings, LLC and Recommendation of Tender” dated August 14, 2024.

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