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      Matsushita Electric Industrial Co., Ltd.
        Mike Kitadeya / Karl Takahashi
        International PR
        Tel: +81-6-6949-2293  Fax: +81-6-6949-2255
        Panasonic News Bureau
        Tel: +81-3-3542-6205  Fax: +81-3-3542-9018
		
      Matsushita Electric Works, Ltd.
        Yukio Kinashi, Publicity Dept.
        Tel: +81-6-6909-7187  Fax: +81-6-6908-7127

Matsushita Group to Reorganize and Consolidate Industrial Equipment Business

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Osaka, Japan - Matsushita Electric Industrial Co., Ltd. (MEI [NYSE:MC]), best known for its Panasonic brand products, and Matsushita Electric Works, Ltd. (MEW) today announced a reorganization plan of their industrial equipment businesses in line with the comprehensive collaboration efforts between the two companies. The plan, involving businesses mainly carried out by MEI's subsidiary, Matsushita Industrial Information Equipment Co., Ltd. (MIIE), aims to eliminate overlaps, further maximizing the group's growth potential in the industrial equipment business and the electrical supplies business in the commercial building market.
 
The details of specific initiatives are as follows:
 

1.	High-voltage power distribution equipment business and central monitoring and control system business to be integrated into MEW

Matsushita's power distribution equipment business will be consolidated by transferring MIIE's high-voltage power distribution equipment (CUBICLE) business and MEW's low-voltage power distribution equipment business (i.e. power distribution boards) for commercial buildings into a new MEW subsidiary, which will be established in January, 2005. The consolidation will allow MEW to offer a complete range of power distribution equipment, a critical component in electrical supplies business, from high voltage to low voltage.
 
MIIE's central monitoring and control system business for facility management will be merged into MEW and placed under the management of its Security and Building Automation System (BAS) Business Promotion Department.
 

2.	Information equipment and systems businesses to be integrated into Panasonic Communications Co., Ltd.

Panasonic Communications Co., Ltd. (PCC) will take over MIIE's information equipment business, including such products as credit authorization terminals, barcode readers and Radio Frequency Identification (RFID) devices, as well as credit authorization terminal development and manufacturing functions currently carried out by Panasonic System Solutions Company (PSS).
 
At the same time, distribution systems business being done at Matsushita Industrial System Engineering Co., Ltd. (MISEC), a subsidiary of MIIE, will be transferred to a subsidiary of PCC.
 
This reorganization will boost the group's capability of developing new products with future growth potential such as contactless IC card and wireless tag readers in the RFID field. It will also contribute to increasing synergy effects in the areas of the manufacturing, procuring and marketing operations.
 

3.	MIIE's two subsidiaries to be transferred to Matsushita Welding Systems Co., Ltd.

Two subsidiaries of MIIE, Kaga Matsushita Electric Co., Ltd. and MISEC, will be transferred to Matsushita Welding Systems Co., Ltd. Kaga Matsushita now serves as MIIE's manufacturing base for welding and CUBICLE related products, while MISEC offers public infrastructure businesses which include utility machinery and related services such as tunnel ventilation control systems and water and sewage treatment plants.
 
As a result of those consolidations and transfers, MEI will eventually take over MIIE. The reorganization is scheduled to take place on April 1, 2005. Two transfers, however, will be carried out on March 31, 2005: MIIE's CUBICLE business to the new subsidiary of MEW and MIIE's central monitoring and control system business to MEW.
 
About Matsushita Electric Industrial Co., Ltd. (Panasonic)
Matsushita Electric Industrial Co., Ltd., best known for its Panasonic brand name, is a worldwide leader in the development and manufacture of electronic products for a wide range of consumer, business, and industrial needs. Based in Osaka, Japan, the company recorded consolidated sales of US$71.92 billion for the fiscal year ended March 31, 2004. Matsushita's shares are listed on the Tokyo, Osaka, Nagoya, New York (NYSE:MC), Euronext Amsterdam and Frankfurt stock exchanges. For more information on the company and its Panasonic brand, visit the Matsushita website at http://www.panasonic.co.jp/global/top.html.

 
< Reference 1>
 
Businesses to be transferred
   (Signing of the agreement is scheduled for early February, 2005)
 

	Businesses to be transferred		Transfer Method	Annual Sales* (Billion Yen)
	From	To
1	High-voltage power distribution equipment (CUBICLE) business (MIIE)	MEW New subsidiary of Information Equipment & Wiring Products Division Company	Business transfer	Approx. 3.4
2	Central monitoring and control system business (MIIE)	MEW Security and Building Automation System Business Promotion Department, Information Equipment & Wiring Products Division Company	Business transfer	Approx. 0.8
3	Power distribution board business (MEW)	MEW New subsidiary of Information Equipment & Wiring Products Division Company	Business division	Approx. 13.2
4	Information equipment and systems business (MIIE)	PCC Devices & Components Company	Business division	Approx. 8.8
5	Credit authorization terminal business (PSS)	PCC Devices & Components Company	Asset transfer	Approx. 0.3
6	Distribution system business (MISEC)	PCC subsidiary	Business transfer	Approx. 0.7
7	Kaga Matsushita Electric Co., Ltd. and MISEC	Matsushita Welding Co., Ltd.	Business division	-

* For the year ended March 2004.
   ** Business transfer schemes are subject to change according to future discussions.
 

<Reference 2>   Business transfer at a glance

 
 

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