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Initiatives for the Rapid Recovery of Disaster–stricken Companies

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Financial Support for Joban Kosan

Supporting a Customer's Business Recovery

Spa Resort Hawaiians is a hot–spring theme park operated by Joban Kosan Co., Ltd. in Iwaki, a city in Fukushima Prefecture. Japanese know it well as the set for the movie, Hula Girl. Spa Resort Hawaiians suffered major damage from the Great East Japan Earthquake, which occurred on March 11, 2011, and another earthquake that occurred on April 11. The epicenter for the latter, in fact, was right under the city of Iwaki. Disabled by these events, Spa Resort Hawaiians was in urgent need of financing to repair its facilities.

The management of Joban Kosan judged that JPY 10 billion was needed to get the resort back on its feet and sought cooperation from Mizuho and other financial institutions. As Joban Kosan's main bank, Mizuho lead discussions with other financial institutions, ultimately arriving at an agreement to provide JPY 10 billion in loans and investments. The needed financial assistance having been secured, Spa Resort Hawaiians achieved a partial reopening on October 1, 2011 and its grand reopening on February 8, 2012. The latter included the revivals of the Beach Theater – the main hula show venue – and the Water Park, as well as the opening of the new Monolith Tower hotel.

Support in the Form of a Loan and Investment

The JPY 10 billion in financial support arranged for Joban Kosan included JPY 3 billion from a third–party allocation of preferred shares, and JPY 7 billion in the form of a syndicated loan.

Arranging for some of the funds Joban Kosan needed to come from a share issuance had the effect of increasing the company's capital and providing it with stable funding and a strengthened financial base.

The preferred shares were allocated to the Mizuho Tohoku Industry Development Fund, the Japan Industrial Solutions Fund I, and the Fukushima Support Fund, with each investing JPY 1 billion.

The Mizuho Tohoku Industry Development Fund was created by Mizuho in August 2011 to support recovery efforts in the Tohoku Region. Capital for the fund was provided by MHCB and MHBK. The fund provides assistance to not only Mizuho customers but also companies introduced by Mizuho customers and financial institutions in disaster–stricken areas. Drawing on a combination of MHCB's industry knowledge and network of major corporations and financial institutions, and MHBK's experience with middle market and small and medium–size enterprises, the Mizuho Tohoku Industry Development Fund is an initiative aimed at contributing to the growth of economic activity in disaster–stricken areas. Joban Kosan was the first company to receive an investment from the fund.

Mizuho Tohoku Industry Development Fund Operating Scheme
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*JV: Joint Venture

MHCB is also an investor in the Japan Industrial Solutions Fund I, which was created to promote the revitalization of industry all over Japan. Joban Kosan was the first recipient of an investment from this fund, as well.

For the syndicated loan, MHCB, acting as the lead arranger, performed tasks like analyzing Joban Kosan's repayment plan and coordinating lending terms with other financial institutions in successfully arranging the syndicated loan of JPY 7 billion from eight financial institutions.

Mizuho, as Joban Kosan's main bank, played a central role in helping it obtain the financial assistance it needed and supported its efforts to recover from disaster damage through a combination of investments and a syndicated loan.

Customer's Voice

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Mr. Kazuhiko Saito
Representative Director and President,
Joban Kosan Co., Ltd.

Following the Great East Japan Earthquake, Spa Resort Hawaiians found it impossible to operate for a significant amount of time. Funding became a major hurdle when it came to recovery. Mizuho, however, stepped in and, as our main bank, led wide–ranging efforts to arrange the loans and investments that were keys to our getting back on our feet as quickly as we did.

Now, we are committed to making fiscal 2012 the "first year of the recovery" of our efforts to work hand–in–hand with the region to recover from the disaster and reinvigorate the tourism industry.

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