Tokyo, February 22, 2001 --- Hitachi, Ltd. (TSE: 6501) and Nissei Sangyo Co., Ltd. (TSE: 8036) announced today they have reached an agreement under which Hitachi's Instruments Group and Semiconductor Manufacturing Equipment Group will be separated and merged with Nissei Sangyo on October 1. At the same time, Nissei Sangyo Co., Ltd. will undergo a change of name to (provisionally) Hitachi Advanced Technologies, Ltd. The move is being done to enable management to speedily respond to market changes in nanotechnology areas such as semiconductor manufacturing equipment and biotechnology-related products. The formal approval of the agreement will take place in June, at Nissei Sangyo's Ordinary General Meeting of Shareholders.
     To integrate domestic and overseas sales of the Instrument Group's clinical testing systems, Hitachi Medical Corporation's (TSE: 6910) sales operation relating to those systems will be transferred to the new company, also on October 1.


     The new company will integrate Hitachi's instruments and semiconductor manufacturing equipment operations with Nissei Sangyo's trading company functions, and will also take over sales of Hitachi Medical's clinical testing systems, resulting in an integrated management system in these nanotechnology areas that encompasses everything from development through to manufacturing, marketing and services. This will speed up decision-making in both business sectors, increasing management efficiency.
     By concentrating resources and making effective use of these resources, the aim of the consolidation is to strengthen market competitiveness and create new businesses in the biotechnology and other sectors to become the world leader in instruments and semiconductor manufacturing equipment.


     In the Medium-term Business Plan the"i.e.HITACHI Plan"announced in November 1999, Hitachi stated its intention to strategically employ the resources of the Hitachi Group to reform itself, both qualitatively and structurally, into the best solutions partner for its customers. Also, as part of Hitachi's basic policy of increasing its total market value, the company has been moving ahead with the implementation of a consolidated management system, based on Hitachi Group based reorganizations, reappraisals and coordinations.
     This consolidation is part of a Group strategy of strengthening nanotechnology operations, which include the instruments and semiconductor manufacturing equipment businesses, and is also based on a fundamental strategy of further strengthening and expanding the integration of operations between Hitachi's business groups and affiliated companies.


     In response to market needs in the area of fine patterning technology, the Instruments Group and Semiconductor Manufacturing Equipment Group have produced numerous products for the semiconductor, materials and biotechnology sectors, including semiconductor manufacturing, inspection and evaluation equipment, clinical analyzers and electron microscopes. In terms of technology, Hitachi is a world leader in the area of medical testing equipment such as automatic blood chemistry analyzers, as well as in the areas of electron microscopes and semiconductor manufacturing equipment, including inspection and evaluation systems for use on semiconductor production lines. Enjoying the synergistic effect with Nissei Sangyo's global sales strengths, those businesses have been expanding.
     However, in order to stay competitive in such leading-edge market sectors, it is also necessary to be the first to develop new technologies and to provide customers with optimized solutions to their needs.


     In the nanotechnology areas of semiconductor manufacturing equipment and biotechnology related products, which are part of the Hitachi Group's strengths, the aim of this latest consolidation of operations is to create a company that is a world leader in its sector, by building an integrated system that includes development, manufacturing, marketing, and services, and utilizing Hitachi's advanced technology and product development capabilities, together with Nissei Sangyo's sales capabilities and service expertise, to speedily provide solutions that are closely matched to customers' needs.
     By also integrating sales of clinical testing systems now being conducted by Hitachi Medical Corporation, the reorganization will consolidate the sales systems both domestic and overseas, helping the company to strengthen its abilities to respond to its customers' needs around the world.


     With the consolidation in October, the employees of the Instruments Group, Semiconductor Manufacturing Equipment Group and related sales departments, as well as Hitachi Medical employees engaged in sales of clinical testing systems, will be transferred to the new company.
     Following the consolidation in October, related facilities in Japan and overseas are expected to be reorganized to strengthen the ability of the new company to respond to the customers' needs in markets around the world.


     The consolidation makes use of the Revisions to the Commercial Code on corporate reorganization, which come into force on April 1, 2001. Under the provisions of this stock for asset transaction, Nissei Sangyo will issue new shares that will be allocated to Hitachi, while continues to list its shares on stock exchanges under the new company name. The parties to the agreement will endeavor to work out by April the number of new shares to be issued and other such details.