MEDIROM Healthcare Technologies Inc. (NasdaqCM: MRM), a holistic healthcare company based in Japan ("MEDIROM" or the "Company"), today announced that at a meeting of the Board of Directors held on May 31, 2023, the Board approved a reorganization of the Company, where the Company will transfer its Digital Preventative Healthcare business to a newly established wholly-owned subsidiary of the Company and transfer the Company's existing salon development department (which is responsible for sourcing and setting up store spaces) and general corporate department (which includes accounting, legal, general affairs, human resources, IT and corporate functions) to an existing wholly-owned subsidiary of the Company (the transactions contemplated thereunder collectively, the "Reorganization")
Purpose of the Reorganization With the official launch and the first batch of shipment of MOTHER Bracelet in 2022, the Digital Preventative Healthcare business experienced strong growth last year. In order to strengthen the Digital Preventative Healthcare business as a major segment of business operations, the Company has decided to spin off the business from the parent company to form a new wholly-owned subsidiary, which is intended to be self-managed based on clearly defined responsibilities and authority pursuant to the management policies implemented in 2021. In addition, by spinning off the Company's salon development and general corporate departments, each operating subsidiary is expected to benefit from quick decision-making and independent management, which, in turn, may strengthen the business competitiveness of each subsidiary. As a result of the Reorganization, the parent company, MEDIROM Healthcare Technologies Inc., as a holding company, will continue to support the business growth of each operating subsidiary and strive to enhance the corporate value of the entire group.