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Mitsubishi Electric and Toshiba Announce Integration of Industrial Electric and Automation Systems Businesses

18 April, 2003


New Joint Venture To Enhance Competitiveness
In Japan and the World Market

Mitsubishi Electric Corporation
Toshiba Corporation

TOKYO, April 18, 2003 -- Mitsubishi Electric Corporation (President and CEO: Tamotsu Nomakuchi) and Toshiba Corporation (President and CEO: Tadashi Okamura) announced that they would establish a new joint venture company integrating their businesses in industrial electric and automation systems, including industrial supervisory control systems, drive systems and power distribution systems. From October 1, 2003, the new company will start business by offering customers worldwide advanced capabilities in industrial electric and automation systems, covering industries as diverse as metal processing, pulp and paper, petrochemicals, automobiles and foods.

The new joint venture will bring together all key functions in the partners’ respective businesses including development, manufacturing and engineering, sales, installation and services. It will integrate the assets of the relevant divisions of each partner, TMA Electric Corporation, an equally owned joint venture of Mitsubishi Electric and Toshiba for large capacity motors, and Toshiba GE Automation Systems Corporation, a Toshiba subsidiary in Japan. The combined operations of the new company are expected to promote overall competitiveness and a global presence, and to support an operating structure that will position the new entity as a leading system integrator in industrial electric and automation systems.

The global market outlook for industrial electric systems remains severe. In Japan, manufacturers continue to cut back on capital investment. While overseas markets are characterized by stable demand they are also witnessing intensified competition. Mitsubishi Electric and Toshiba decided to integrate their businesses to enhance competitiveness and promote their presence in the overseas markets for industrial electric and automation systems.

This integration is expected to benefit to three key areas

1. Enhanced product competitiveness.
Reorganizing development and manufacturing facilities and promoting product line integration will achieve this. Centralized product development activities will lead to faster product development. Review and realignment of product lines and reorganized manufacturing will improve cost competitiveness.
2. Reinforced market presence.
A reinforced market presence in both Japan and overseas will follow complementary customer and market integrations in Japan based on the partners’ strengths. A more global sales network will boost visibility overseas.
3. Enhanced operating efficiency.
This will be achieved through business integration and a new management structure will promote speedy decision-making.

Outline of New Company

Company name TBA
Start of operations October 1, 2003
Capitalization and
capital reserve
Approximately 35 billion yen (planned)
Shareholding Toshiba 50%, Mitsubishi Electric 50%
President TBA
Headquarters Tokyo, Japan (planned)
Business area
1) Sales, engineering, installation and servicing of industrial
electric and automation systems for wide range of industrial manufacturing plants.
2) Development and manufacturing of power electronic apparatus, large capacity electric motors and automation systems for industrial applications.
Sales Target Approximately 160 billion yen in fiscal year 2006
Manufacturing
Facilities
1) Supervisory control systems for manufacturing plant:
Fuchu (part of Toshiba Fuchu Complex); Kobe and Nagasaki (parts of Mitsubishi Electric facilities)
2) Power electronics equipment:
Fuchu (part of Toshiba Fuchu Complex); Kobe and Nagasaki (parts of Mitsubishi Electric facilities)
3) Large capacity electric motors:
Keihin, Mie, Nagasaki (currently handled by TMA Electric Corporation)
Employees Approximately 2,300 (at initial operation)

About Mitsubishi Electric Corporation

With over 80 years of experience in providing reliable, high-quality products to both corporate clients and general consumers all over the world, Mitsubishi Electric Corporation (TSE: 6503) is a recognized world leader in the manufacture, marketing and sales of electrical and electronic equipment used in information processing and communications, space development and satellite communications, consumer electronics, industrial technology, energy, transportation and building equipment. The company has operations in 35 countries and recorded consolidated group sales of 3,649 billion yen (US$27.4 billion) in the year ended March 31, 2002. For more information about Mitsubishi Electric visit http://global.mitsubishielectric.com

About Toshiba Corporation

Toshiba Corporation, a world leader in high technology, is a diversified manufacturer and marketer of advanced electronic and electrical products, spanning information and communications equipment and systems, internet-based solutions and services, electronic components and materials, power systems, industrial and social infrastructure systems, and household appliances. The company’s integration of these wide-ranging capabilities assures its position as a leading company in all aspects of industrial electric and automation systems. Toshiba has 176,000 employees worldwide and annual sales of over US$40 billion. Visit Toshiba's web site at http://www.toshiba.co.jp/index.htm

For Media inquiries only

Mitsubishi Electric Corporation
Robert Barz
Public Relations Department
Tel: +81-3-3218-2346
Robert.Barz@hq.melco.co.jp

Toshiba Corporation
Junko Furuta
Corporate Communications Office
Tel: +81-3-3457-2105
press@toshiba.co.jp


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