Yokogawa Electric Corporation (Yokogawa) and Ando Electric Co., Ltd., (Ando) today signed a partnership agreement in which the two companies will collaborate on business strategies for their measurement and electronic device testing equipment. At the same time, NEC Corporation (NEC) (NASDAQ: NIPNY, FTSE: 6701q.l, TSE: 6701) agreed to transfer 33% of Ando's issued shares to Yokogawa on February 28, 2001. NEC currently holds 35% of Ando's issued shares.

On January 14, 2000, Yokogawa announced a new corporate strategy focusing its business efforts on the measurement sector and a policy to accelerate sales growth. Ando has also set itself on a path to reinforcing development of its core business by investigating the formation of a strategic alliance with an industry partner, while NEC has focused on a reorganization of its group wide structure.

The alliance between Ando and Yokogawa will center on Ando's measurement systems for the optical communications area, together with Yokogawa's measurement instruments for the development of communications networks and multimedia communications equipment. It also covers areas both companies have been involved with, such as ATE semiconductor testing and device handling systems where the partners intend to offer a wide range of products and services to create greater customer satisfaction and global competitiveness as test solutions providers.

The collaboration in their ATE and measurement equipment businesses by the two partners is worth 130 billion Yen. But, by taking advantage of the anticipated synergies created through their alliance and by focusing on the communications, multimedia, semiconductor and other growth areas, the two companies forecast this figure to reach 200 billion Yen in 2005.

One highly anticipated synergy is the integration of Ando's world-class optical technologies and Yokogawa's compound semiconductor technologies, that is expected to be key to the development of next-generation high-speed, high capacity optical communications equipment. Another synergy will be in the mobile communications and Internet protocol (IP) based data communications realm, where the combination of resources and technology at both companies is forecast to result in significant business growth.

In the ATE area, the strategic alliance between Ando and Yokogawa is expected to give them strong coverage and leading test solutions in all device testing fields, from mixed signal devices to logic and memory devices. Considering the increasing need for digital information in the coming IT society, the companies will focus on the development of test solutions for key enabling devices. In the largest ATE market, memory devices, the partners will take advantage of Ando's leading high-speed test technology to enhance sales at both companies.

NEC, aiming to maximize the corporate value of the overall NEC Group by reviewing capital relationships, will sell all but 2% of its 35% holding in Ando to Yokogawa to promote business synergy. NEC and Yokogawa enjoy a strong relationship based on their procurement of semiconductors and measurement equipment from each other, and NEC believes that an alliance between Ando and the world-leading Yokogawa will enhance business development at Ando significantly. It is also seen as a means of continuing the close business relationship among the three parties.

About Ando Electric Co., Ltd.
Ando Electric Co., Ltd., is a pioneering test and measurement company based in Japan. Ando is an industry leader with its cutting edge optical and digital communications test gear including Ando's Optical Spectral Analyzer for DWDM, Tunable Laser Source, and the world's first OC-192 SONET Analyzer. Ando currently employs over 1,400 people at 26 locations worldwide, including the US, Japan, Asia and Europe. For further information, please visit the Ando Electric home page at: http://www.ando.co.jp

About NEC Corporation
NEC Corporation (NASDAQ: NIPNY) (FTSE: 6701q.l) (TSE: 6701) is a leading provider of Internet solutions, dedicated to meeting the specialized needs of its customers in the key computer, network and electron device fields through its three market-focused in-house companies: NEC Solutions, NEC Networks and NEC Electron Devices. NEC Corporation, with its in-house companies, employs more than 150,000 people worldwide and saw net sales of 4,991 billion Yen (approx. US$48 billion) in fiscal year 1999-2000. For further information, please visit the NEC home page at: http://www.nec-global.com