May 11, 2007

Japan AE Power Systems Corporation Established a New Engineering and Manufacturing Joint Venture Company for GIS and GCB in Suzhou City, China

Japan AE Power Systems Corporation (headquartered in Minato-ku, Tokyo, President and Director: Masakazu MORI) announces the establishment of AE Power (Suzhou) EHV Switchgear Corporation in People’s Republic of China (PRC), a new joint venture company with Chung Hsin Electric & Machinery Manufacturing Corporation (headquartered in Taiwan, ROC, Chairman: Eric CHIANG) and Hitachi High-Technologies Corporation (headquartered in Minato-ku, Tokyo, CEO: Hidehito OBAYASHI), for engineering and manufacturing of the units and complete set of Gas Insulated Switchgear (GIS) and Gas Circuit Breaker (GCB). The company, which is our fifth joint venture company in China, has been established as part of our efforts to expand our business in China and overseas.

1. Purpose of establishment
	Thanks to the rapid economic growth in China, large-scale investments are expected in the field of electrical power, which is a fundamental infrastructure. We have been expanding our businesses through our joint venture companies such as Shandong Luneng AE Power Systems Co., Ltd. and Shanghai Zonfa E Power EHV Equipment Co., Ltd. The newly established company will be organized to have substantial function of designing, manufacturing and inspecting GIS and GCB, which employs various parts from local vendors, thus minimizing cost while maintaining the reliability of those products and providing high-quality parts and units to our customers enables us to aim increase our shares in China and Asia.
2. Outline of the new company
	Company name : AE Power (Suzhou) EHV Switchgear Corporation Location : Suzhou City, Jiangsu, People’s Republic of China Business activities : Engineering and manufacturing of units and complete sets of GIS and GCB Date of establishment : April 23, 2007 Start of production : August 2007 (Plan) Capital : US$5 million (Apx. 600 million Japanese Yen) Shareholders : Japan AE Power Systems Corp.: 81% Chung Hsin Electric & Machinery Manufacturing Corp.: 10% Hitachi High-Technologies Corp.: 9% Officers : Chairman : Toyokazu TANAKA (Japan AE Power Systems Corp., Executive Officer and General Manager, High Voltage Switchgear Division)     Vice Chairman : Chou-Liang LAI (Chung Hsin Electric and Manufacturing Corp., Vice President)     President : Hiroshi SUZUYAMA (Japan AE Power Systems Corp., Chief Advisor, HV Switchgear Division) Site area : Apx. 39,500m2 Number of employees : Apx. 100 (Plan for 2007) Amount of sales : US$14.2 million (Apx. 17 billion Japanese Yen) (Target for 2010)
3. Outline of the partners
	Company name : Chung Hsin Electric and Manufacturing Corporation Location : Taoyan Hsien, Taiwan, Republic of China Date of establishment : 1956 (Present company name adopted in 1962) Capital : NT$6,230 million (Apx. 21.8 billion Japanese Yen) Amount of sales : Apx. NT$10,000 million (Apx. 35 billion Japanese Yen) Representative : Eric CHIANG, Chairman Business activities : Manufacturing and sales of transmission and distribution equipment including GIS and GCB       Company name : Hitachi High-Technologies Corporation Location : Minato-ku, Tokyo, Japan Date of establishment : 1947 Capital : 7.9 billion Japanese Yen Amount of sales : 952 billion Japanese Yen (Fiscal year 2006) Representative : Hidehito OBAYASHI, CEO Business activities : Manufacturing and sales of electronics related products