Komatsu Executes Agreement with TOYOBO Concerning the Acquisition of Shares of NIPPEI TOYAMA

KOMATSU LTD. (President: Masahiro Sakane) ("Komatsu") executed a Share Transfer Agreement today with TOYOBO CO., LTD. (President: Ryuzo Sakamoto) ("TOYOBO") to acquire 20.4% of the shares of NIPPEI TOYAMA CORPORATION (President: Hiroyuki Horii) ("NIPPEI TOYAMA") owned by TOYOBO. Upon completion of certain procedures, such as notifications and approvals, etc. under the competition laws of relevant jurisdictions, the share acquisition is scheduled to be completed by the end of December of this year.
Komatsu is positioning its expanded industrial machinery business, which is a combination of its construction and mining equipment business and its industrial machinery business, which is mainly comprised of stamping press machines used in the forming of automobile components, fabricating machineries and machine tools such as crankshaft millers, to be a core business of the Komatsu Group.
NIPPEI TOYAMA is highly regarded in the industry as a top manufacturer in the field of transfer machines used in the processing of automobile engines, various grinding machines, wire saws used in the semiconductor and solar application industries, and laser cutting machines, etc. The major customers for both NIPPEI TOYAMA and the industrial machinery business of Komatsu are the industries related to automobiles and semiconductors, and the synergies derived from the complementary effect of the product mix is strong. In addition, they each have manufacturing bases in the Hokuriku region of Japan. By this purchase of an equity interest and by becoming the largest shareholder of NIPPEI TOYAMA, Komatsu expects that synergies can be developed in the manufacturing area as well as in the research, development, sales and service areas.


[Outline of NIPPEI TOYAMA CORPORATION]
Corporate name:NIPPEI TOYAMA CORPORATION
Date of establishment:July 26, 1945
Location:6-26-2 Minami-Oi, Shinagawa-ku, Tokyo
Representative Director:Hiroyuki Horii
Capital:¥6 billion
Listing:Second section of the Tokyo Stock Exchange
Net sales:¥73.6 billion (Fiscal year ended March 31, 2006)
Business activities:Manufacture and sales of machine tools, industrial machines, real estate sales, etc.
Manufacturing bases:Toyama and Kanagawa, Japan
Number of employees:1,526 (Consolidated, as of March 31, 2006)

[Outline of TOYOBO CO., LTD.]
Corporate name:TOYOBO CO., LTD.
Date of establishment:June 26, 1914
Location:2-2-8 Dojima Hama, Kita-ku, Osaka
Representative Director:Ryuzo Sakamoto
Capital:¥43.3 billion
Listing:First section of the Tokyo and Osaka Stock Exchange
Net sales:¥401.9 billion (Fiscal year ended March 31, 2006)
Business activities:Manufacture and sales of plastics, functional materials, bio-science and medicals, and textiles
Manufacturing bases:Tsuruga, Iwakuni, Shougawa and Inuyama, Japan
Number of employees:11,705 (Consolidated, as of March 31, 2006)

[Number of the Share Acquisition, Ownership Ratio and Acquisition Amount]
Number of shares owned prior to acquisition:0 shares (ownership ratio: 0%)
Number of shares acquired:10,315,000 shares (ownership ratio: 20.4%)
Acquisition amount:¥ 9,180 million

[Outlook]
Komatsu believes this acquisition of the shares will have only a minimal impact on its business performance for the current fiscal year.

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