Komatsu Industries Makes Alliance and Equity Acquisition

Komatsu Industries Corporation (hereinafter referred to as "Komatsu Industries"), a wholly owned subsidiary of Komatsu Ltd. (hereinafter referred to as "Komatsu"), today reached an agreement with MARUKA MACHINERY CO., LTD. (hereinafter referred to as "MARUKA MACHINERY") and its subsidiary, Sonoruka Engineering Co., Ltd. (hereinafter referred to as "Sonoruka Engineering"), concerning a business alliance between Komatsu Industries and Sonoruka Engineering, including Komatsu Industries' acquisition of Sonoruka Engineering's equity.

[Outline of the Agreement]

1. Summary
Komatsu Industries sells Sonoruka Engineering-made industrial machinery as peripheral equipment of its presses to automakers, consumer electronics and machinery and related companies. Therefore, Komatsu Industries regards this alliance as an important sales strategy. Through this alliance, Sonoruka Engineering will be able to gain Komatsu Industries' expertise in the industrial machinery business. Sonoruka Engineering can expect to further improve its technical capabilities and reduce costs as it works to expand its operations in the future.

2. Alliance
1) The two companies will unify their drawing standards of some products to reduce their production costs.
2) They will share their know-how of press peripheral equipment to improve engineering capabilities.
3) They will work to strengthen their engineering capabilities through active exchanges between their related departments.

3. Equity Acquisition
Komatsu Industries will acquire 21,600 shares (18% of the total number of shares issued and outstanding) of Sonoruka Engineering held by MARUKA MACHINERY.

4. Outline of Komatsu Industries
Trade name: Komatsu Industries Corporation
Established: May 1994
Address: 1-6-8 Omori-kita, Ota-ku, Tokyo, 143-0016, Japan
Representative: Kouji Yamada, President
Paid-in capital: ¥990 million
Shareholder: Komatsu Ltd. (100%)
Annual sales: ¥45.9 billion for the fiscal year ended March 31, 2006
Line of business: Development, production, sales and services of presses, sheet metal machinery, and peripheral equipment

5. Sonoruka Engineering
Trade name: Sonoruka Engineering Co., Ltd.
Established: February 1974
Address: 2-28 Itsukaichimidori-machi, Ibaraki City, Osaka, 567-8520, Japan
Representative: Shinji Kamae, President
Paid-in capital: ¥60 million
Shareholder: MARUKA MACHINERY CO., LTD. (100%)
Annual sales: ¥1.9 billion for the fiscal year ended November 30, 2005
Line of business: Production and sales of peripheral equipment of presses

6. MARUKA MACHINERY
Trade name: MARUKA MACHINERY CO., LTD.
Established: December 1946
Address: 2-28 Itsukaichimidori-machi, Ibaraki City, Osaka, 567-8520, Japan
Representative:Shinji Kamae, President
Paid-in capital: ¥1,403 million
Listing: Second sections of Tokyo and Osaka stock exchanges
Annual sales: ¥41.0 billion for the fiscal year ended November 30, 2005
Line of business: Domestic sales and export/import of machine tools, presses, civil engineering and construction equipment, material handling equipment, food processing machines, water cleaning systems and other machines.

7. Schedule
October 20, 2006: Komatsu Industries, Sonoruka Engineering and MARUKA MACHINERY will enter the formal contract for the alliance agreement.
October 24, 2006: Komatsu Industries will acquire the shares of Sonoruka Engineering.

8. Outlook
Komatsu believes this alliance agreement will have only a minimal impact on its business performance for the current fiscal year.

(end)