Hitachi Metals : Announcement of Holding an Extraordinary Shareholders Meeting Related to Share Consolidation, Abolition of the Provisions regarding a Share Unit, and Partial Amendment to the Articles of Incorporation

November 21, 2022

To all parties concerned,

Company Name: Hitachi Metals, Ltd. Name of Representative: Mitsuaki Nishiyama Chairperson, President, and CEO (Code: 5486; Prime Market of the Tokyo Stock Exchange) Contact: Izumi Tsubouchi

General Manager, Corporate Communications Dept. (Phone: [phone])

Announcement of Holding an Extraordinary Shareholders Meeting Related to Share

Consolidation, Abolition of the Provisions regarding a Share Unit, and Partial Amendment to

the Articles of Incorporation

Hitachi Metals, Ltd. (the "Company") announces that it has decided to convene an extraordinary shareholders meeting to be held on December 9, 2022 (the "Extraordinary Shareholders Meeting") and submit to the Extraordinary Shareholders Meeting the proposal for share consolidation and the proposal for abolition of the provision regarding a share unit and partial amendment to the Articles of Incorporation, as below.

The common shares of the Company (the "Company Shares") will meet the delisting criteria of Tokyo Stock Exchange, Inc. (the "Tokyo Stock Exchange") in the process of the procedures above. In doing so, it is expected that the Company Shares will be designated as securities to be delisted between December 9, 2022 and December 28, 2022, and then be delisted as of December 29, 2022. Please note that the Company Shares will no longer be tradable on the Tokyo Stock Exchange after they are delisted.

1. Date and venue of the Extraordinary Shareholders Meeting

1. Date
   10 a.m., Friday, December 9, 2022
2. Venue
   B1 Banquet Room AURORA, Tokyo Dome Hotel, 1-3-61 Koraku, Bunkyo-ku, Tokyo

1. Proposals to be submitted to the Extraordinary Shareholders Meeting
   Matters for resolution:
   Proposal No. 1 Share Consolidation
   Proposal No. 2 Partial Amendment to the Articles of Incorporation

1. Share consolidation

1. Purposes of and reasons for share consolidation

As announced in the Company's press release dated October 26, 2022 titled "Announcement of Results of the Tender Offer by K.K. BCJ-52 for the Shares of Hitachi Metals, Ltd., and Change in a Major Shareholder and an Other Affiliate," K.K. BCJ-52 (the "Tender Offeror") implemented a tender offer for the Company Shares (the "Tender Offer") from September 27, 2022, and consequently, came to own 152,194,289 shares of the Company Shares (voting right ownership ratio (Note): 35.60%) as of November 1, 2022, the commencement date of the settlement of the Tender Offer.

(Note): The "voting right ownership ratio" is calculated using as a denominator the number of voting rights (4,275,529 units) pertaining to the number of shares (427,552,987 shares), which is obtained after deducting the treasury shares owned by the Company (1,351,266 shares) and the Company Shares equal to less than one unit owned by Hitachi, Ltd. ("Hitachi") (99 shares), which were not planned to be acquired through the Tender Offer, as of September 30, 2022 from the Company's outstanding shares (428,904,352 shares) as of the same date, and is rounded to the second decimal place. The same applies below.

As described in "[2] Purpose and Background of the Transaction, including the Tender Offer, and Management Policy Following the Tender Offer" of "(2) Grounds and reasons for the opinions concerning the Tender Offer" of "3. Details of, and Grounds and Reasons for, the Opinion on the Tender Offer" of "Announcement of Opinion in Support of the Tender Offer by K.K. BCJ-52 for the Shares of Hitachi Metals, Ltd., and Recommendation of Tender" published by the Company on September 26, 2022 (the "Press Release Expressing the Company's Opinion"), the Company formulated our Mid-Term Management Plan for Fiscal Year 2021 (announced in April 2019), setting "Create People, Create Innovation, and Create the Future" as our vision, where the Company aims to become a high-functional materials company that supports a sustainable society by promoting management strategies and measures to further strengthen our development capabilities to create "Only one, Number one" products, which are our strengths, through collaborative creation with customers in various business fields, and strengthen our manufacturing capabilities to mass-produce them. To this end, specifically, the Company has been working on the following action plans: [1] concentration of resources on high-growth, high- profit areas, [2] maximization of synergies through organizational reforms [3] strengthening of the front- end structure and collaborative creation with customers, [4] full utilization of large-scale capital investments, and [5] implementation of structural reforms and measures to strengthen the management base. However, since the announcement of the medium-term management plan, profitability has deteriorated, such as impairment loss recorded in the second quarter financial results for FY2019 (announced on October 29, 2019), and down ward revision in the full-year consolidated earnings forecast for FY2019, due to factors such as the fact that demand in the automotive sector, factory automation, robotics and other industrial sectors, as well as in the electronics sector, has become more severe than anticipated at the time of the announcement. Since then, the Company has continued to consider various measures to fundamentally restore its business performance and to develop growth strategies. In addition, the business environment has changed significantly due to the recent outbreak of COVID-19. In particular, in the automotive sector, a decline in global automobile sales volume has led to a decline in demand for many key products, while in the aircraft sector, a decline in demand for aircraft-related materials has resulted from a decline in demand for aircraft. Although the Company stated that it would improve capital efficiency and concentrate resources on growth business in the medium-term management plan, it has not achieved results and its profitability has deteriorated due to a decrease in sales revenue, resulting in the announcement of the outlook of negative adjusted operating margin in FY2020 (2021/3), announced on May 27, 2020. Also, the Company has also announced "Misrepresentation of Test Results in the Inspection Reports with Respect to Certain Products of the Company and Its Subsidiaries" on April 27, 2020, and as of the end of May 2020, multiple directors including the CEO, as well as one director who was a former CEO have resigned. To accelerate decision making going forward, the chairperson of the board of directors has also been made to serve as the CEO

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as of June 1, 2020, while the Company is also appointing new directors, and moving to a new management structure.

Based on the above profitability and consideration, the Company decided on middle of June that it is necessary to improve speed of decision-making, obtain funds for investment, and introduce external knowledge in order to increase its enterprise value by reinforcing its competitiveness and profitability, and that the best way for that goal was to proceed with reforms after delisting without being restricted by the current capital structure. This decision does not have any direct relationship with the content of the aforementioned "Misrepresentation of Test Results in the Inspection Reports with Respect to Certain Products of the Company and Its Subsidiaries," nor with the subsequent move to a new management structure.

Then, as described in "[4] The process of decision-making for how the Company came to agree with the Tender Offer, and the grounds therefor" of "(2) Grounds and reasons for the opinions concerning the Tender Offer" of "3. Details of, and Grounds and Reasons for, the Opinion on the Tender Offer" of the Press Release Expressing the Company's Opinion", the Company and Hitachi started the bidding process, which was comprised of two stages (the "Bidding Process"): the first bidding process and the final bidding process for the selection of the partner candidates, from early November 2020, which included due diligence by several candidates and discussions with each candidate. Through this bidding process and as a result of considering the proposal details of each candidate comprehensively, the Company selected BC Consortium (the general term for Bain Capital Private Equity, LP and its group (collectively, "Bain Capital"), Japan Industrial Partners, Inc. ("JIP"), and Japan Industrial Solutions K.K. ("JIS"); the same applies below) as the final purchaser candidate from among several candidates in early April 2021 and started discussions and considerations with BC Consortium for implementation of the transaction aimed at making the Company a wholly-owned subsidiary (the "Transaction"), including the Company acquiring all of the Company Shares owned by Hitachi (228,221,199 shares, ownership ratio: 53.38%, the "Shares to Be Sold by Hitachi") (the "Share Repurchase" and the acquisition price of treasury shares through the Share Repurchase, the "Share Repurchase Price").

The purchaser finally selected from among the candidates and the Company's parent company, Hitachi, will execute a final contract that covers implementation of the Tender Offer. As described in "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" of "3. Basis, etc. for the amount of money expected to be delivered to shareholders as a result of processing the treatment of fractional shares pertaining to share consolidation" below, considering that there might be a chance that Hitachi and the Company's general shareholders might have conflicts of interest, the Company established a special committee on September 3, 2020, before the start of the first bidding process, in order to eliminate arbitrariness in the Company's decision-making concerning the Transaction, and the candidate selection process during the Bidding Process, and to consider and evaluate, among other things, the validity of the transaction conditions, including pros and cons of the Transaction or the structure and fairness of the procedures, including the process of selecting the purchaser (partner), from the standpoint of aiming to increase corporate value and to make profits for general shareholders. The Company has consulted with the special committee on the fairness and validity of the Transaction procedures, among other matters (for the composition of the committee and other specific matters regarding which it was consulted, please refer to "[2] Establishment of a special committee independent of the Company and acquisition of opinions" of "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below). Additionally, after the Company took the measures described in "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below, it carefully discussed and considered the selection of candidates in and conditions for the Transaction, considering details in the stock valuation report obtained from BofA Securities Japan Co., Ltd. ("BofA Securities"), the Company's financial advisor, and the legal advice received from Nishimura & Asahi, the Company's legal advisor, with the utmost respect given to the report submitted by the special committee on April 28, 2021 (the "April 2021 Report").

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In order to increase corporate value, the Company comprehensively considered, from perspectives of the stock valuation, transaction structure, contract terms, financing ability/funding prerequisites, management strategy and support system after implementation of the Transaction including value-up measures, whether any changes are planned to the terms and conditions of the management policy, such as treatment of employees and the governance system, the necessity of procedures like acquisition of clearance under competition law and other regulatory laws and whether the required period for such procedures are within a reasonable range, and how the Company can maximize the profits of its general shareholders. As a result, the Company came to the conclusion that BC Consortium is the best purchaser as a partner for the Company, to aim for further growth, and will contribute to the improvement of corporate value in the future, from the standpoint of the highest stock valuation and the Tender Offer Price, as well as its financial capability and preconditions for financing being not inferior to those of other candidates, and the proposed management strategy and support system after implementation of the Transaction, including value-up measures.

The Company notified all candidates in the first-round bidding process that the Company would not accept joint proposals by consortia with third parties, as if the Company allowed candidates to form a consortium freely, this would lead to the sharing of proposal terms and conditions including proposal values among candidates, thus possibly leading to the bidding process losing its validity and fairness. In the final bidding process, however, the Company permitted Bain Capital, JIP and JIS to form a consortium as they wished, and also permitted other candidates to form consortia with candidates other than Bain Capital, JIP and JIS, as the pool of candidates was limited as result of the first round, and as it was critical for consortium participants to align on matters such as post-investment policy.

In addition, with regard to the tender offer price of 2,181 yen per Company Share (the "Tender Offer Price"), (a) as mentioned above, the stock valuation BC Consortium provided was the highest amount compared with the stock valuations presented by each candidate that participated in the final bidding process, (b) as described in "[4] Acquisition of the Stock Valuation Reports from the Company's independent financial advisor and third-party valuation institution" of "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below, in the valuation of the Company Shares as stated in the April 2021 Stock Valuation Report (as defined in "[4] Acquisition of the Stock Valuation Reports from the Company's independent financial advisor and third-party valuation institution" of "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below) by BofA Securities, the Tender Offer Price exceeds the upper limit of the calculation obtained through market price analysis, comparable companies analysis, and comparable transactions analysis, and it also exceeds the median of the calculation range in the discounted cash flow analysis ("DCF Analysis"), (c) it is the price after adding a premium of 74.48% (rounded to the second decimal place; the same shall be adopted below in the calculation of the premium rate) to JPY 1,250, the closing price of the Company Shares on the Tokyo Stock Exchange on October 25, 2019, which was the day when the news that Hitachi was discussing capital relations with its four listed subsidiaries, which triggered the fluctuation in the stock price of the Company due to expectations that the Hitachi group would be reorganized, was announced by President Toshiaki Higashihara of Hitachi after the close of trading of the Company Shares on the Tokyo Stock Exchange; 80.25% (rounded to the nearest whole number; the same shall be adopted below in the calculation of the simple average value) to JPY1,210, the simple average value of closing prices for one month prior to that point of time; 86.57% to JPY1,169, the simple average value of closing prices for three months prior to that point of time; and 85.93% to JPY1,173, the simple average value of closing prices for six months prior to that point of time, and it is the price after adding a premium of 15.76% to JPY1,884, the closing price of the Company Shares on the Tokyo Stock Exchange on April 27, 2021, the business day prior to the date of announcement of the Tender Offer, 16.32% to JPY1,875, the simple average value of closing prices for one month prior to that point of time; 21.23% to JPY1,799, the simple average value of closing prices for three months prior to that point of time; and 30.99% to JPY1,665, the simple average value of closing prices for six months prior to that point of time, and these premium are considered reasonable compared to past cases involving tender offers by persons other than issuers acting with the aim of making a wholly-owned subsidiary, and (d) as described in "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below, measures have been taken to ensure the fairness of the Tender Offer,

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and it is recognized that the profits of general shareholders have been considered. Given the above, the Company came to the conclusion that the Tender Offer will provide the Company's shareholders with a reasonable opportunity to sell their shares.

Therefore, at the board of directors' meeting held on April 28, 2021, as the Company's opinion at that point in time, the Company adopted a resolution to express its opinion to support the Tender Offer when the Tender Offer commences and to recommend that the Company's shareholders tender in the Tender Offer.

In addition, the Tender Offer will commence promptly when the Conditions for the Commencement of the Tender Offer have been satisfied (or waived by the Tender Offeror). According to the Tender Offeror, as of April 28, 2021, the Tender Offeror planned to commence the Tender Offer in late November 2021; however, it was difficult to estimate the period required for the procedures involving domestic and international competition authorities accurately. Therefore, the board of directors' meeting above also adopted a resolution that when the Tender Offer commences, the board of directors will request that the special committee established by the Company consider whether there are changes in its opinions as expressed to the board of directors on April 28, 2021, and, if there are no changes, make a statement to that effect, or, if there are changes, state the changed opinions (the "Additional Matters of Inquiry"), and that based on such opinions, the Company will express its opinions on the Tender Offer again when the Tender Offer commences, and the Company consulted with the special committee on the Additional Matters of Inquiry.

Thereafter, having been notified by the Tender Offerors on September 20, 2022 that it intends to commence the Tender Offer with a Tender Offer Commencement Date of September 27, 2022, as clearances had been obtained on September 7, 2022 (local times) for the necessary permits and authorizations based on competition laws and other regulatory laws domestically and internationally (Japan, Brazil, China, the EU, Serbia, South Korea, Taiwan and Vietnam, but excluding the necessary permits and authorizations based on the FEFTA of Japan), and on the assumption that all other Conditions for the Commencement of the Tender Offer have been fulfilled or the Tender Offeror waives all other Conditions for the Commencement of the Tender Offer, the Company shared details on the status of the Company and the Tender Offerors with all members of the Special Committee at its 24th meeting held on September 26, 2022. As described in "[2] Establishment of a special committee independent of the Company and acquisition of opinions" under "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below, the special committee deliberated carefully about the Additional Matters of Inquiry. As a result, the special committee submitted a supplementary report (the "Supplementary Report") dated September 26, 2022 to the Company's board of directors indicating that its opinion dated April 28, 2021 had not changed.

Consequently, the Company once again carefully deliberated on and considered the content of the various conditions related to the Tender Offer, on the basis of the Company's business performance, including the effects of COVID-19, progress of yen depreciation, soaring raw material prices, and changes in the market environment since April 28, 2021, by fully respecting the content of the Supplementary Report submitted by the special committee to the utmost. Therefore, the Company concluded that (a) as of September 26, 2022, there is no cause to change the judgment it made regarding the Tender Offer on April 28, 2021, given facts such as that the Transaction will contribute to the Company's corporate value, the unchanged necessity to improve the Company's corporate value by recovering its prior competitiveness and earning power and to renew its growth, and also that (b) in the valuation of the Company Shares as stated in the September 2022 Stock Valuation Report (as defined in "[4] Acquisition of the Stock Valuation Reports from the Company's independent financial advisor and third-party valuation institution" of "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below) by BofA Securities described in "[4] Acquisition of the Stock Valuation Reports from the Company's independent financial advisor and third-party valuation institution" of "(3) Measures to ensure the fairness of the Transaction and measures to avoid conflicts of interest" below, the Tender Offer Price exceeds the upper limit of the calculation obtained through market price analysis, comparable companies analysis, and comparable transactions analysis, as well as

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