Briefing Material for March 2026 M&A (with Script)

I am Suzuki, Corporate Vice President & Group CFO.

Thank you for joining this special conference call on such short notice. Today, we announced the acquisition of two medical device manufacturers based in Boston, Acra Cut, Inc. and Intech, Inc. In this session, I would like to provide an overview of this transaction.

In our Mid Term Management Plan "NV2030," which we announced last August, we defined our M&A strategy and stated that we would continue managing a pipeline of acquisition opportunities in the surgical business. Among the opportunities in that pipeline, the transactions we were most eager to pursue are precisely the acquisitions of Acra Cut and Intech announced today. Acra Cut is a company that manufactures and sells highly specialized consumable products in the field of surgical medical devices. We expect that integrating their brand and manufacturing expertise will represent a significant step forward for the growth of our surgical business.

DCI

Surgical

Surgical

DCI

OR,U.S.A.

AcraCut Intech

MA, U.S.A. MA, U.S.A.

100%

100%

Dental Surgical In-

dustrial

NSK America HD

DE, U.S.A.

NSK America

IL, U.S.A.

Nakanishi Inc.

Kanuma, JPN

( North America )

100% 100%

M&A Structure

© 2026 NAKANISHI INC.

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The structure of the transaction is shown on the left side of the slide.

Through our U.S. subsidiary, NSK America, we will acquire 100% of the shares of Acra Cut and Intech, using a combination of cash on hand and borrowings as the source of funds. Following the acquisition, both companies will become subsidiaries of NSK America, and therefore our second-tier subsidiaries. This structure reflects our expectation that NSK America will take a leading role in the integration process that follows. In the PMI phase, we believe that leveraging NSK America's operational platform and organizational know-how will be essential. At the same time, because NSK America is primarily a sales company, we plan for our headquarters to provide support in areas such as manufacturing capabilities and related functions.

Please note that this share acquisition is subject to a confidentiality obligation with the individual counterparty, and therefore details such as the acquisition price will not be disclosed. Thank you for your understanding. Today, our Board of Directors approved the acquisition, and we have executed the agreement with the counterparty. The share transfer is scheduled to be completed on April 1.

Overview of Acra Cut and Intech

▲ Cranial Perforator

▲ Acra Cut / Intech Headquarters

© 2026 NAKANISHI INC.

3

The image in the upper left of the slide shows representative products of Acra Cut and Intech - cranial perforators, commonly referred to simply as "perforators," which are disposable surgical drills. Perforators are medical devices used during craniotomy procedures to create initial burr holes in the skull. Surgeons drill several holes with the perforator and then use a craniotome-a surgical saw-to cut and open the skull starting from those holes. Perforators are equipped with an automatic clutch mechanism that stops drilling once the skull is penetrated, allowing for safe and controlled operation. There are both reusable and single-use types, but the market has largely shifted toward single-use, disposable perforators.

The images in the lower left of the slide show the headquarters and manufacturing facilities of Acra Cut and Intech. They are located in Acton, a quiet suburb of Boston. There are several similarities between the Acra Cut and Intech factories and our own. Their production process begins with machining raw materials-using equipment such as automatic lathes-and continues through multiple steps before the products are completed as surgical drills. In addition to the similarity in the products themselves, namely surgical drills, I would like to note that there are also commonalities in production capabilities, including machine tools and machining know-how.

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© 2026 NAKANISHI INC.

Estimated based on data from: Fundamental Business Insights and Consulting, "Cranial Perforator Market Size and Forecast 2026-2035";Global Market Monitor, "Global Cranial Perforator Market Competition Pattern", and in-house research

Limited market share

in Europe and Asia

(aggressive low-price strategies by new entrants)

Medtronic

U.S.A.

etc.

High market share

in the U.S. and Japan

(strong brand and customer base)

Adeor

Germany

Largest market: United States

(approx. 40% of the global market)

Future growth driven by Asia

(approx. 7% growth)

Stryker

U.S.A.

Recognized for reliable quality

and strongly supported by healthcare professionals

CAGR 2～5％

Codman

U.S.A.

Perforators

Global market size … 120 ~150M$

Acra Cut and Intech's

Positioning

Competitors

Market Size

Market Environment and Positioning

Please let me now explain the market environment and Acra Cut's positioning.

We estimate the global market for perforators to be approximately USD 120-150 million annually, with an expected growth rate of around 2-5% per year. The market forecasts cited here are based on the references noted at the bottom of the slide. Within this market, we believe that Acra Cut holds a share of roughly 15%.

Key players in this market include Codman in the United States, Adeor in Germany, as well as Stryker and Medtronic.

Acra Cut is positioned as a manufacturer that primarily offers high-quality, premium-priced products. This positioning serves as both a strength and a challenge. While Acra Cut enjoys strong market share in regions where customers value and are willing to purchase higher-priced products-such as the United States and Japan-its share remains low in markets such as Europe and emerging economies, where price competition is more significant. To expand its global market share, we believe it will be necessary to pursue business strategies that go beyond the company's traditional approach-for example, by adding more cost-competitive products to the lineup in the future.

Strategic Value of the Acquisition

Enhancing the foundation of Surgical Business

through the Acra Cut and Intech acquisitions

Securing

U.S. manufacturing capabilities

Intech has accumulated extensive manufacturing expertise,

with solid production foundation for the consumables business

Ensuring a wide range of options for the future reorganization

of the Surgical Business platform

© 2026 NAKANISHI INC.

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Creating sales synergies

NSK and Acra Cut complement each other's product lineups

×

Strengthening sales approaches through the shared customer base and sales network

Expanding market coverage through the collaboration between NSK and Acra Cut

Expansion of the U.S. business

A strong brand built on high-quality products

×

A consumables business with stable and high profitability

Enhancing market presence as a driver of sustainable growth

An important point in understanding the strategic significance of acquiring Acra Cut and Intech is that we are acquiring manufacturers of rotary cutting instruments, drills. Our company produces dental drills, which are disposable rotary instruments used for tooth preparation, while Acra Cut and Intech produce disposable drills used to cut through the skull. Because the core technologies and manufacturing know-how that underpin both businesses are highly similar, we believe there is strong potential to generate operational synergies.

Building on this fundamental concept, the first strategic significance of the acquisition is the expansion of our surgical business in the United States. Acra Cut is a well-recognized manufacturer in the U.S. market and possesses a strong brand presence. A key driver of this brand strength is the high quality of its products, which is an important aspect of this transaction. Another point of significance is that their products are consumables, providing a recurring revenue model that supports stable earnings. By gaining a strong brand with recurring income, we expect to enhance our market presence and create a solid foundation for further growth.

Another point of significance is that our options have broadened with respect to the reorganization of production functions. By having acquired the production capabilities of Acra Cut and Intech, we view it as meaningful that our range of options has expanded as we consider future reorganization of production functions. Sharing the manufacturing know-how possessed by the two companies will also lead to improvements in productivity. We believe that the availability of these new options will be a plus for Nakanishi in the future.