Sumitomo Mitsui Banking Corporation (President & CEO: Akihiro Fukutome, hereinafter "SMBC") announced a capital investment agreement with CHITOSE BIO EVOLUTION PTE. LTD. (CEO: Tomohiro Fujita, hereinafter collectively referred to as "CHITOSE Group") for an amount of 1 billion yen.

CHITOSE Group is a group of biotechnology companies leading the global bioeconomy (*1). To live in abundance beyond the next millennium using the ability of living things, CHITOSE Group pursues the possibilities of biotechnology through technological and business development collaborating with its business partners all over the world. CHITOSE Group develops in breeding and cultivating technology for a wide range of organisms. They conduct extensive R&D and business development in various fields, including microalgae, cells, fermentation, agriculture, and intestinal bacteria. As global social issues such as population growth, increasing food shortages, and climate change become more serious, international attention is paid to the bioeconomy as a means of promoting sustainable economic growth.

Government support in Japan is also strengthened in this field, where the Japanese government developed "Japan's Bioeconomy Strategy" in 2019 to achieve the world’s most advanced bioeconomy society in Japan by 2030.

Microalgae, which can efficiently produce a variety of valuable raw materials from carbon dioxide and photosynthesis, are expected to be used not only as a substitute for fossil resources but also for a wide range of other purposes. CHITOSE Group, as an initiative toward the mass production and commercialization of such biotechnology, is leading the MATSURI (MicroAlgae Towards SUstainable & Resilient Industry) project, which aims to build a microalgae industry and value chain.

Sumitomo Mitsui Financial Group, Ltd. (President & Group CEO: Toru Nakashima) has set "Create social value" as one of the basic policies in its current Mid-Term Management Plan and designated "environment" as one of its priority issues. In terms of above issue, "Social Value Creation Investment Fund" (*2) have been established as a framework to support the creation of businesses with customers who wish to create social value through risk-taking.

This investment in CHITOSE Group is accomplished within the framework of above. Taking this opportunity, we will further pursue the decarbonization of the industry by collaborating not only with CHITOSE Group but also with companies that are building value chains utilizing biotechnology.

(※1) Bioeconomy The knowledge-based production and use of biological resources to provide products, processes and services in all economic sectors within the frame of a sustainable economic system.

(※2) Social Value Creation Investment Fund Please kindly refer to the news release “Establishment of Expense Budget for Creation of Social Values” dated May 17, 2024.