2008 Press Releases-07

Yokogawa Electric Corporation and TESEC Corporation have come to terms on the transfer of Yokogawa's IC handler business to TESEC, and a business transfer agreement was signed on March 26. The companies will subsequently determine the details of the transfer, which is to be formally implemented on July 1, 2008.

As a part of its business restructuring strategy, Yokogawa has been selecting and focusing on promising businesses whose technologies differentiate it in the marketplace and enjoy good synergy with other businesses. As the IC handler business is not expected to be a market leader and has little synergy with other main businesses, Yokogawa has decided to transfer it. The company plans to enhance its value by making effective and efficient use of its investment capital and focusing investment on the core businesses of test and measurement as well as industrial automation and control.

TESEC's main business consists of handlers and systems for testing discrete semiconductors(*). Since its foundation, the company has attached strategic important to the handler business and expanded into the IC market. The company believes that this transfer of the IC handler business from Yokogawa will enrich its IC handler product line and customer base, thereby strengthening its competitiveness in the world market and adding to its business volume. The company will endeavor to enrich its development capability by integrating the transferred technology, and will engage in mass production to reduce production costs. Further, the company aims to grow its semiconductor test equipment business and increase its company value.

* Discrete semiconductors: collective name for transistors, diodes and other single function semiconductor elements

Overview of business transfer

1. Scope
   development, manufacturing, sales, and servicing of handlers
   
   
2. Sales volume
   Fiscal year 2006: 2,880 million yen
   Fiscal year 2007: 1,721 million yen (as of the end of the third quarter)
   
   
3. Transfer assets
   approximately 900 million yen (as of December 31, 2007)
   
   
4. Goodwill
   250 million yen

Effect on the two companies' businesses
This business transfer will not have any effect on the business results of either company in the current fiscal year. The impact on Yokogawa in the next fiscal year will be negligible. The impact on TESSEC is uncertain at this moment and will be disclosed as soon as such a forecast is available.