KKR L P : Announcement Regarding Progress Toward Conducting the Tender Offerfor Shares of Hitachi Kokusai Electric Inc.

In its press release dated April 26, 2017, titled 'Announcement Regarding the Tender Offer for the Shares of Hitachi Kokusai Electric Inc. (Securities Code 6756)' (the 'April 26 Press Release'), HKE Holdings G.K. ('HKE') announced that it aims to commence a tender offer (the 'Tender Offer') in early August 2017 for the common shares of Hitachi Kokusai Electric Inc. (Securities Code: 6756, First Section of the Tokyo Stock Exchange) (the 'Target Company').

As stated in the April 26 Press Release, the Tender Offer is subject to the condition that the third-party committee established by the Target Company (the 'Third-Party Committee') has provided and has not withdrawn a positive report in answering the Matters of Inquiry ((i) the purpose of the Transaction (as defined in the April 26 Press Release; hereinafter the same) is justifiable and reasonable; (ii) the fairness of the procedures for the Transaction has been ensured; (iii) the legitimacy and propriety of the terms of the Transaction have been ensured; and (iv) the implementation of the Transaction is not disadvantageous to the minority shareholders of the Target Company) (the 'Condition Precedent') and certain other matters designated as preconditions.

As of July 19, 2017, HKE notified the Target Company of HKE's intention to commence the Tender Offer on August 10, 2017, designated as the tender offer commencement date, subject to satisfaction of these preconditions for commencement of the Tender Offer.

In response, according to notice HKE received from the Target Company on August 9, 2017, the Target Company requested that the Third-Party Committee examine whether there is any change in its opinion expressed in its report dated as of April 26, 2017 (the 'Original Report') to the Target Company's Board of Directors; and if there has been no change, to report to the Target Company's Board of Directors that there has been no change; or if there has been any change, to report its opinion after the change. Regarding this inquiry, also according to the notice from the Target Company, the Third-Party Committee submitted to the Target Company's Board of Directors a report as of August 9, 2017 (the 'Report') stating that, in respect of Matters of Inquiry (i) and (ii), the Third-Party Committee does not see any necessary changes to its opinion in the Original Report, but in respect of Matter of Inquiry (iii), the Third-Party Committee finds it difficult at the current time to maintain its opinion that the legitimacy and propriety of the Tender Offer Price and the Share Repurchase Price (as each term is defined in the April 26 Press Release) are ensured, and accordingly the Third-Party Committee also finds it difficult to maintain its opinion in the Original Report regarding Matter of Inquiry (iv), which was premised on the Third-Party Committee's opinion in respect of Matter of Inquiry (iii).

Given that the Condition Precedent has not been satisfied as of August 9, 2017 because the Report withdraws the positive Original Report with respect to the Matters of Inquiry, HKE has decided not to commence the Tender Offer in early August as previously scheduled.

HKE will continue discussing matters, including its plans regarding the Tender Offer, and whether to conduct the Tender Offer and its possible timing, etc., with the Target Company, Hitachi, Ltd., Japan Industrial Partners, Inc. and other parties; and HKE will announce promptly after the details are decided.

End

(Reference)

For a summary of the Third-Party Committee's opinion, etc., please see the Target Company's press release, dated August 9, 2017, titled 'Announcement Regarding Progress Toward Conducting the Tender Offer for Shares of Hitachi Kokusai Electric Inc. by HKE Holdings G.K.'

Company Name: HKE Holdings G.K.

Representative: William Janetschek, Executor

Contact: 03-6268-6000