September 27, 2005

Name of company:

KAGA ELECTRONICS CO., LTD.

Stock code:

8154

Stock exchange listing:

Tokyo Stock Exchange, First Section

Headquarters:

2-2-9, Hongo, Bunkyo-ku, Tokyo

Representative

 

Title:

Founder & CEO

Name:

Isao Tsukamoto

Contact person

 

Title

Senior Managing Director, Finance & Administration Headquarters

Name:

Waichiro Shimoyama

Tel:

+81-(0)3-4455-3111

 

Notice of establishment of subsidiaries

 

KAGA ELECTRONICS CO.,LTD.(Founder & CEO: Isao Tsukamoto, Headquarters: Bunkyo-ku,

Tokyo, Capital: 11,933million yen) has established KGF CO.,LTD. in September 16, 2005, and

thereby makes the following announcement.

 

1. Company profile

Name of company:

KGF CO.,LTD.

Headquarters:

2-2-9, Hongo, Bunkyo-ku, Tokyo

Date of establishment:

September 16, 2005

Capital:

30 million yen

Representative

 

Title:

President

Name:

Shinsuke Takahashi

Major stockholders:

KAGA ELECTRONICS CO., LTD.

(Ownership: 86.67%)

 

Other stockholders

(Ownership: 13.33%)

Description of business:

Operates a restaurant, sales of foods, beverages and health supplements

Financial outlook:

Fiscal year ended March 2006: Net sales 93 million yen

 

2. Reason for establishment of subsidiaries

The establishment of specialized subsidiary is aimed to expand into new business field,

utilizing the sales network and know-hows from KAGA ELECTRONICS' long experience. The

Company expects a new growth strategy in inaugurating new business.

 

3. Financial outlook

KAGA ELECTRONICS calculates in net sales of 100 million yen at the end of the first fiscal

year. And the Company is expecting about 500 million yen in net sales in another three years.