ValueAct Capital Responds to Seven & i Presentation

ValueAct is a major, long-term shareholder with a longstanding history of constructive engagement

Issues letter calling for removal of Seven & i's President due to long track record of entrenchment

Latest examples of entrenchment include denial of an independent investigation of secret recordings of shareholders and denial of an independent review of a shareholder proposal

ValueAct proposed a refreshed Board with mandate to select a new President through independent process in line with Japan's Corporate Governance Code

New President should prioritize stakeholder interests and improve performance

ValueAct submitted proposals to remove four entrenched and long-tenured incumbent Directors: Mr. Ryuichi Isaka (President), Mr. Katsuhiro Goto (Vice President), Mr. Kunio Ito (Chairman of Nomination Committee), and Mr. Toshiro Yonemura (Member of Nomination Committee) 

ValueAct proposed to re-elect the six new Independent Outside Directors who joined the Board in 2022 and four Inside Directors who directly manage major businesses and group functions to ensure operational continuity 

ValueAct also nominated four new Independent Outside Directors who are qualified, diverse business leaders with relevant skills and experiences

Full letter available at https://valueact.com/presentations/

SAN FRANCISCO, April 20, 2023 /PRNewswire/ -- ValueAct Capital ("ValueAct"), a global investment firm who has been a major shareholder of Seven & i Holdings ("Seven & i", "the Company"), since 2020, today sent an open letter (the "Letter") (see attached) to shareholders of Seven & i in response to the Presentation made public by Seven & i on April 18, 2023.

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ValueAct has a unique 22-year history of helping companies pursue successful transformations and long-term value creation through respectful dialogue and constructive relationship building. Seven & i, however, has continually failed to provide shareholders with an objective review of the Company's conglomerate structure following many years of poor corporate value creation and operating underperformance. After extensive dialogue over several years, ValueAct has been unable to establish confidence in the management, strategy, or governance of the Company.

As detailed in the letter issued by ValueAct today, ValueAct has called for the removal of Seven & i's President based on a long series of bad faith actions over his seven-year tenure. Most notably, just in the past month, the President refused to allow an independent investigation into the practice of secretly recording shareholders without consent and the subsequent leak of one such recording to a journalist at a major news outlet. In addition, the President denied an independent review of a sensitive shareholder proposal which presented major conflicts of interest for the President and the majority of the Board.

The Letter goes on to detail ValueAct's shareholder proposal to elect a Board with the skills, independence, and mandate to appoint a new President & Representative Director who can prioritize the interests of common shareholders and lead the company as a global champion in line with Japan's Corporate Governance Code. ValueAct has proposed re-electing the Company's six Independent Outside Directors and replacing four entrenched and long-tenured directors with four new and highly qualified director candidates who are diverse business leaders with relevant skills and experiences.

ValueAct is known for its patient, constructive and relationship-oriented approach to long-term investing. ValueAct will not hesitate to exercise their shareholder rights as part of their fiduciary duty when the opportunity for stakeholders to benefit from transformation is so high, and the evidence of management's entrenchment becomes undeniable.

The Letter was written to Shareholders and shared publicly because ValueAct believes there is an urgent need for change at the Company in order to repair trust in its governance and management.

About ValueAct Capital
ValueAct Capital, established in 2000, is a global investment firm managing capital on behalf of some of the world's largest institutional investors. The Firm's goal is to transform companies and help them become 21^st Century Global Champions. VAC seeks to identify and invest in high-quality businesses that are temporarily under-valued, taking a patient, collaborative and constructive approach to value building for all stakeholders with long-term investments. The firm generally holds 10-18 investments at any given time, and ValueAct Capital's internal team has built a track record serving on over 55 public company board seats.  For more information, please see https://valueact.com/.  To view the full letter please visit https://valueact.com/presentations/.

CONTACT: [email protected]

SOURCE ValueAct Capital