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SDK Transfers SCSM Shares to Cabot

January 31, 2002

Showa Denko K.K. (SDK) today concluded an agreement with Cabot Corporation of the United States (Cabot) whereby SDK will transfer all shares it owns in Showa Cabot Supermetals K.K. (SCSM) to a newly established company within the Cabot Group. The transfer of shares will be made sometime between mid-February and end of March.
SCSM is a 50-50 joint venture between SDK and Cabot engaged in production and sale of capacitor-grade tantalum powder. As part of the ongoing medium-term consolidated business plan named the "Cheetah project," SDK has been reducing its debt partly through sale of some of its operations and affiliates. Meanwhile, Cabot is committed to further strengthening its tantalum powder operations.

Profile of Showa Cabot Supermetals K.K.

Capital ¥434 million
Shareholders Showa Denko K.K. (50%)
Cabot International Capital Corporation (50% )
Main business Production and sale of capacitor-grade tantalum
powder, tantalum ingot and mill products;
Import and resale of tantalum mill products,
niobium and related products
Total assets ¥23,332 million (Estimate as of December 31, 2001)
Sales for 2001 ¥18,594 million (Estimate)
Head office 9-5, Shiba-koen 2-chome, Minato-ku, Tokyo
President Minoru Yamanaka
Number of employees 139

Profile of Aizu Holdings Co., Ltd.(Transferee of SCSM shares)

Capital ¥268 million
Shareholders Cabot Corporation (100% )
Main business To own shares in a company for tantalum operations
Head office 1-15, Shiba 3-chome, Minato-ku, Tokyo
President Yasuto Komatsu

SDK will record a profit of approx. ¥13 billion. This transaction is already included in SDK's performance forecast for 2002 (January 1 - December 31, 2002) announced on January 29.
For your information, SDK has announced the following performance forecast

(Unit: billions of yen)

Sales Operating Incom Ordinary Profit Net Profit (loss)
Consolidated 680 30.0 16.5 12.0
Non-consolidated 414 13.2 5.6 14.5