Hitachi, Ltd.'(NYSE:HIT) and Showa Denko K.K.,have entered into a basic agreement 
under which Hitachi will become a majority shareholder in Showa Denko Computer 
Service Co., Ltd. (SCS), Showa Denko's wholly-owned information processing subsidiary. 
 On October 1, SCS will restart operations as a member of the Hitachi Group, 
provisionally renamed Hitachi SC Co., Ltd. (HSC) .  HSC will carry on SCS's business 
operations, involving performing information processing on an outsourcing basis for 
Showa Denko and the member companies of the Showa Denko Group, the sale and 
development of software, consulting, and other such information system building and 
operating services.  HSC will also focus on providing solutions for other companies 
outside the Showa Denko Group.

For enterprises faced with stiff competition, concentrating management resources 
on their core competencies has become major focus.  At the same time, however, in order 
to compete, companies also have the task of having to incorporate systems based on the 
latest information technology.  This has led to a steady increase in the use of outsourcing 
companies to develop and run such information systems.

As part of a move to strengthen its service business, Hitachi is pushing forward 
with the expansion of related operations by entering into alliances with leading enterprises 
in each area of industry.  HSC will be strategically positioned to serve the chemicals 
industry, using the advanced expertise and high level of personnel resources and 
information processing technology built up over the years by SCS to provide the Showa 
Denko Group and the chemicals industry in general with solutions to their information 
processing requirement.

In 1984, Showa Denko established SCS as a wholly-owned subsidiary for carrying 
out information processing work for Showa Denko and the Showa Denko Group.  In the 
same way, these companies will be able to use HSC to meet their information processing 
requirements on an outsourcing basis, thereby enabling them to increase efficiency by 
channelling management resources into their areas of core competency.

Under the agreement between the companies, Hitachi will hold 55.6% of HSC 
stock, with Showa Denko holding the remaining 44.4%.  HSC will be run jointly by the 
two companies.  The synergy between the systems expertise built up by SCS in the 
chemicals sector and Hitachi's information technology infrastructures, will be used to 
provide high quality, highly competitive information systems implementation and 
operating services.  One of HSC's main contracts involves the construction and operation 
of an SAP R/3 system for Showa Denko.  Looking ahead, this will be utilized to attract 
new customers from among the ranks of Showa Denko Group companies as well as other 
companies within the chemicals sector.

Outline of the new company
Company name:		Hitachi SC Co., Ltd. (provisional)
Location:		Yokohama,Kanagawa,Japan
Business:      		-Outsourcing
               		-Development and sale of software
               		-Consulting services
               		-Sale of Information & Telecommunication products
Capital:		90 million yen
Projected sales: 	3.3 billion yen in first fiscal year (fiscal 1999)
Fiscal year:		April 1 to March 31
Start of operations: 	October 1, 1999
President:		Hiroyuki Nishikubo (Hitachi, Ltd.)
Number of employees:	Approximately 150

Outline of Hitachi and Showa Denko
Hitachi, Ltd.
President:		Etsuhiko Shoyama
Location:		Tokyo,Japan
Date established:	February 1, 1910 (incorporated 1921)
Capital:		281,735 million yen
Number of employees:	67,078 (as of March 31, 1999)
Web site:               http://www.hitachi.co.jp

Showa Denko K.K.
President&CEO:		Mitsuo Ohashi
Location:		Tokyo,Japan
Date established:	June 1, 1949 (incorporated 1916)
Capital:		105,448 million yen
Number of employees:	4,199 (as of June 30, 1999)
Web site:               http://www.sdk.co.jp

SAP and R/3 are registered trademarks of SAP AG.

<Press Contacts>
Hitachi,Ltd.                               	Hitachi America, Ltd. USA
Masanao,Sato                                    Gerard F. Corbett
Tel:+81-3-3258-2056                             Tel: +1-650-244-7900
E-mail:syoujiki@cm.head.hitachi.co.jp		E-Mail:gerard.corbett@hal.hitachi.com
	
Hitachi Europe Ltd.				Hitachi Asia Ltd.
Masao Takebayashi                               Yuuji Hoshino
Tel: +44-1628-585000		                TEL: +65-231-2522
E-Mail:mtake@hitachi-eu.com                     E-Mail:yhoshino@has.hitachi.com.sg
	
Showa Denko K.K.
Sadamasa,Takamizu
Tel:+81-3-5470-3235
e-mail:Sadamasa_Takamizu@sdk.co.jp