President's Statement

Nomura Principal Finance Co., Ltd.
President Shoichi Nagamatsu

The Nomura Group has been actively engaged in principal investment overseas since 1995. Backed by its eminent reputation and sophisticated financial technology, it has invested a total of £13.2 billion (equity: £3.8 billion) in various enterprises. The Group's investment in, for example, the privatization of British Railways and military housing, major hotel groups and pub-restaurant chains spread across the U.K. has earned it a reputation for financial excellence.

With that track record, Nomura Group established Nomura Principal Finance (NPF) in July 2000 for the purpose of making similar investments in Japan. As a business partner, NPF has provided unprecedented solutions to diverse management problems, such as spin-offs of non-core businesses and MBOs (management buyouts). In addition, other methods include the management succession of family-owned enterprises, restructurings of shareholder ownership, the rebuilding of businesses, and changes in business models and business lines. It has done so while maintaining a basic orientation toward long-term investment returns.

In recent years selection and concentration, the reorganization of group operations and the concentration on core businesses, have been recognized by Japanese companies as urgent management tasks. In addition, we are now seeing a marked increase in calls for additional capital to support business expansion as the economy recovers, along with higher needs for capital to be used in strategic de-listings. As such, our business of providing risk capital is in a position to play an increasingly large role in the Japanese business landscape.

In view of this situation, we are being proactive in providing risk capital. We are also taking full advantage of the Nomura Group's specialized services. Such services include risk management and management consulting services and services to improve balance sheets and arrange business tie-ups, so as to rebuild and revitalize the companies we invest in. Through our efforts to enable these companies to fully demonstrate the potential of their management resources for the benefit of society, we will do our utmost to infuse a new dynamism into the Japanese economy.

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