FOR IMMEDIATE RELEASE

Hitachi to Commence Tender Offer for the Shares of its Subsidiary,
Hitachi Software Engineering
Tokyo, July 28, 2009—Hitachi, Ltd. (NYSE: HIT / TSE: 6501 / “Hitachi”) today
announced that it has decided to acquire the common stock of Hitachi Software
Engineering Co., Ltd. (TSE: 9694), by way of a tender offer (the “Tender Offer”).
1. Purpose of the Tender Offer(1) Outline of the Tender Offer
Hitachi currently holds 51.55% of Hitachi Software Engineering’s issued shares,
including indirect shareholdings of 0.20%, and thus accounts for Hitachi Software
Engineering as a consolidated subsidiary. Hitachi intends to acquire all the issued
shares of Hitachi Software Engineering (exclusive of its treasury stock) in order tomake Hitachi Software Engineering a wholly owned subsidiary through the Tender
Offer. The Tender Offer does not set maximum and minimum limits to the number ofshares to be purchased.
According to Hitachi Software Engineering, its Board of Directors resolved toapprove the Tender Offer and to recommend that the shareholders of Hitachi Software
Engineering subscribe to the Tender Offer at a meeting of its board of directors held
today.
(2) Decision-Making Process of the Tender Offer, and Management Policy after
the Tender Offer
The Hitachi Group, which consists of Hitachi, its subsidiaries and affiliated companies,
conducts a wide range of business activities from the development, production andsales of offerings to the provision of relevant services in seven business segments:
Information & Telecommunication Systems; Electronic Devices; Power & Industrial
Systems; Digital Media & Consumer Products; High Functional Materials &Components; Logistics, Services & Others; and Financial Services.

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In the information & telecommunication systems business, the Hitachi Group wasquick in initiating, as part of its effort to meet changing users’ needs, the developmentof various information and telecommunication systems that correspond to various
types and lines of business (system integration). The Hitachi Group has also expanded
its outsourcing business and has been a pioneer in the SaaS (Software as a Service)business, which grants customers the use of software for their needs. These initiatives
have progressed well.
As for the business, in countries and regions that have already built a certain degreeof social infrastructure, including power systems, transportation systems, roads andwater and other public systems, information and telecommunication systems are
expected to grow further as part of social infrastructures and to be increasingly fusedwith existing social infrastructures. Therefore, with its extensive track record in theconventional fields of both the social infrastructure business and the information &telecommunication systems business, the Hitachi Group intends to utilize thatexperience, expertise and technological capability to concentrate on the “social
innovation business” that fuses its social infrastructure business with its information &telecommunication systems business.
Hitachi Software Engineering was established in 1970 and currently engages insoftware service businesses, including systems development, services and products &packages, and the information processing equipment business. The systems
development business mainly handles the development of large-scale systems for
major financial and public institutions—Hitachi’s principle clients. The services
business conducts an Internet banking service “FINEMAX,” and SaaS businesses
utilizing “Salesforce”, a product of Salesforce.com, Inc. of the U.S. The products &packages business offers package software solutions including “HIBUN,” which isused in security fields, and “KATSUBUN,” which contributes to promoting thepaperless office. The information processing equipment business offers electronic
blackboard system “StarBoard,” which enjoys a high market share at home and abroad.
However, the domestic information service market is currently at a critical turning
point. In the conventional information service market, users’ demand for hardware andsoftware to establish, operate and maintain their own information andtelecommunication systems led to the expansion and growth of the market. However,interest in system investments has been shifting recently from the maintenance of
information systems (system integration) to the more efficient use and operation of
information and telecommunication systems (e.g., outsourcing and SaaS).
Consequently, it is expected that users’ demand for these new services, including the- more --3-

use of packaged software products and systems for shared use, will become a driving
force in the market. In order to secure earnings and achieve further growth byresponding to the changing market needs at this period of transition in the information
service market, the Hitachi Group believes it necessary to enlarge the global businessthat have been led solely by Hitachi Software Engineering, as well as to further
enhance the Group’s advanced and large-scale system-building capability andhigh-quality software development abilities.
Hitachi anticipates that demand for the social innovation business, on which the
Hitachi Group intends to focus its marketing efforts, will expand significantly. Hitachisees urgent tasks in the business to be the Hitachi Group’s development of products
and packages commensurate with the business and the swift establishment of service
business foundations for the growth of the business. Consequently, Hitachi considers it
necessary that the Hitachi Group invests its management resources in the information& telecommunication systems business.
Under these circumstances, since early April 2009, Hitachi and Hitachi Software
Engineering have worked together and continued to discuss and consider various
measures for business structural reform with the goal of raising their respective
enterprise values. As a result, Hitachi and Hitachi Software Engineering havedetermined that strengthening the collaboration between Hitachi Software Engineeringand the Hitachi Group and promoting the integration of the information
telecommunication systems businesses in the Hitachi Group could be reinforced byestablishing a closer capital relationship between both corporations, and thereby:
1) Hitachi Software Engineering, as a core company in the Hitachi Group, will beable to reinforce its response capabilities to big accounts, expansion of businesses
for leading medium-sized enterprises, and development of products & packages orservice business foundation in market demands as well as high-quality basic
software and embedded software;
2) Hitachi Software Engineering will be able to strengthen its earning power by utilizing
the Hitachi Group’s human resources, sales and marketing and technologicalcapabilities;
3) Hitachi Software Engineering will be able to further expand its global businesses
through the active utilization of the Hitachi Group’s overseas sales and marketingstrengths; and
4) The social innovation business on which the Hitachi Group focuses its efforts will
create and expand new business opportunities by swiftly conducting various
developments required for the business expansion.
Hitachi and Hitachi Software Engineering have reached a conclusion that these- more --4-

effects will enhance the enterprise value of both companies and the Hitachi Group andto achieve the intended effects it is essential to make Hitachi Software Engineering awholly owned subsidiary of Hitachi. Hitachi believes that making Hitachi Software
Engineering a wholly owned subsidiary will enable the concentration and organic
combination of the Hitachi Group’s management resources, including intellectual
properties, human resources and technological capabilities associated with systemdevelopment, software development and system operations, thereby facilitating various
developments required for the expansion of the social innovation business on which
the Hitachi Group focuses its efforts.
In an attempt to establish the business structure described above, concurrently withthe commencement of the Tender Offer, Hitachi has initiated tender offers for theissued shares of Hitachi Systems & Services, Ltd. and Hitachi Information Systems,
Ltd., both of which will assume their respective businesses in the information &telecommunication systems business in the Hitachi Group, with the aim of making
them wholly owned subsidiaries.
As a specific method to establish a new business structure, establishment of an informationand telecommunication company as a virtual entity within the Hitachi Group is been
considered. Five major existing companies―Hitachi (Information & Telecommunication
Group), Hitachi Software Engineering, Hitachi Systems & Services, Hitachi Information
Systems and Hitachi Electronics Services Co., Ltd., a wholly owned subsidiary of
Hitachi—would be equal partners in this virtual company. The most appropriate strategies
and business structure for the future information and telecommunication company as awhole, as well as the strategies to reinforce the social innovation business will be decided
and implemented.
Under such business structure, the Hitachi Group intends to improve and expand thestructure to flexibly cope with customer needs while taking into account the industry,scale and the type of business of each customer with the aim of providing valuable
one-stop services throughout the whole IT life cycle to customers in the global market
as follows.
1) Development of the data center operation business optimizing green IT
technologies;
2) Offer of highly reliable cloud computing environment;
3) Expansion of global businesses utilizing collaborations with local business
partners and localized operations;4) Strengthen our readiness for projects of large-scale accounts, such as backbone
systems for financial institutions including megabanks and optimization systems in- more --5-

the public sector;5) Unify the information system businesses for the SMB (small to medium business)markets, mainly in the industrial and distribution fields;6) Expand the development system for middleware and embedded software for
products; and
7) Strengthen and expand the network service business and the outsourcing business.
Although the optimal solution for the basic strategies and future orientation of theinformation and telecommunication company after making Hitachi Software Engineering
a wholly owned subsidiary will be determined in consultation with Hitachi Software
Engineering, Hitachi intends to reinforce Hitachi Software Engineering’s businesses,
even after making it a wholly owned subsidiary, by not only respecting its self-initiatives
and independence but also paying attention to the business features and the management
which fully utilizes operational and structural strengths.
(3) Measures to Ensure the Fairness of the Tender Offer including Measures to
Ensure the Fairness of the Tender Offer Price and to Avoid Conflicts ofInterest
Hitachi principally took into consideration the following matters to ensure the fairnessof the Tender Offer.
1) Acquisition of the valuation report on the equity value received from an independent
third-party appraiser
In determining the purchase price for the Tender Offer (the “Tender Offer Price”),
Hitachi requested that Nomura Securities Co., Ltd. (“Nomura Securities”), a financial
adviser as a third-party appraiser independent from Hitachi and Hitachi Software
Engineering, calculate the equity value of Hitachi Software Engineering as one of themeasures to ensure the fairness of the Tender Offer Price.
To calculate the equity value of Hitachi Software Engineering, Nomura Securities
used the average market share price method, the comparable company analysis method
and the discounted cash flow method (the “DCF” method). Hitachi received thevaluation report regarding the valuation results on the equity value of Hitachi Software
Engineering (the “Valuation Report for Hitachi”) today, from Nomura Securities(Hitachi did not obtain an opinion on the fairness of the valuation results of the Tender
Offer Price, the so-called Fairness Opinion, from Nomura Securities.)
The range of valuations per share of common stock of Hitachi Software Engineering
calculated according to each method is as follows.
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Average market share price method¥1,364 to ¥1,712

Comparable company analysis method ¥1,417 to ¥1,872
DCF method¥2,044 to ¥2,932

First, under the average market share price method, Nomura Securities judged therange per share of common stock to be ¥1,364 to ¥1,712 based on the closing price ofHitachi Software Engineering’s common stock on the First Section of the Tokyo Stock
Exchange on the record date of July 24, 2009, the average closing price for the mostrecent one week, the average closing price for the most recent one month, the averageclosing price for the most recent three months and the average closing price for themost recent six months.
Secondly, under the comparable company analysis method, Nomura Securities judged
the range per share of common stock to be ¥1,417 to ¥1,872, evaluating Hitachi
Software Engineering’s equity value by comparing share prices and financial indicatorssuch as the profitability of listed companies engaged in relatively similar businesses tothose of Hitachi Software Engineering.
Finally, under the DCF method, Nomura Securities judged the range per share ofcommon stock to be ¥2,044 to ¥2,932 after analyzing enterprise value and equity value
by discounting free cash flows Hitachi Software Engineering is expected to generate in
the future by a certain discount rate to arrive at a net present value. This analysis was
based on Hitachi Software Engineering’s estimated future profits from the fiscal year
ending March 31, 2010 and later, taking into consideration Hitachi Software
Engineering’s business plans, an interview with management of Hitachi Software
Engineering, recent business performance, public information disclosures and othercontributing factors.
Hitachi took into account the valuation results received from Nomura Securities using
each method in its Valuation Report for Hitachi as a reference and comprehensively
considered examples of premiums added as of determining tender offer prices in pastexamples of tender offers for shares by entities other than issuers; whether the Board of
Directors of Hitachi Software Engineering would accept the Tender Offer; the market
share price trend of Hitachi Software Engineering’s common stock; the expected numberof subscriptions to the Tender Offer; and other factors. Furthermore, taking into accountthe results of consultations and negotiations with Hitachi Software Engineering, the final
Tender Offer Price was determined at ¥2,650 per share of common stock by Hitachi’s
President and Chief Executive Officer today.
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The Tender Offer Price per share of ¥2,650 represents a premium of 54.8% (rounded
to the first decimal place) on the closing price of ¥1,712 of Hitachi Software
Engineering shares on the First Section of the Tokyo Stock Exchange on July 24, 2009(*). It also represents a premium of 56.9% (rounded to the first decimal place) on thesimple average of ¥1,689 (rounded to the nearest yen) of the closing share prices ofcommon stock of Hitachi Software Engineering for the past month (from June 25 toJuly 24, 2009) as well as a premium of 72.4% (rounded to the first decimal place) on
the simple average of ¥1,537 (rounded to the nearest yen) of the closing share prices ofcommon stock of Hitachi Software Engineering for the past three months (from April
27 to July 24, 2009) and a premium of 94.3% (rounded to the first decimal place) on
the simple averages of ¥1,364 (rounded to the nearest yen) of the closing share pricesof common stock of Hitachi Information Systems for the past six months (fromJanuary 26, 2009, to July 24, 2009).
(*)The stock price of Hitachi Software Engineering rose following a news report
regarding the business restructuring of the Hitachi Group on July 27, 2009, which isthe day before the day when the aforementioned decision was made by Hitachi's
President and Chief Executive Officer. Considering this rise in the stock price, thepremium was calculated using the stock price on July 24, 2009, a business day before
July 27, 2009. The calculations of the respective premiums on the simple average ofthe closing share prices of common stock for the past one month, for the past threemonths and for the past six months were made in the same manner.

On the other hand, according to Hitachi Software Engineering, in determining an opinion
on the Tender Offer Price, Hitachi Software Engineering had Mizuho Securities Co., Ltd.
calculate its equity value as a measure to ensure the fairness of the evaluation of theTender Offer Price. Mizuho Securities is a financial advisor as a third party appraiser
independent of Hitachi and Hitachi Software Engineering, and also does not hold thestatus as a Related Party. On this basis, Mizuho Securities calculated the equity value of
Hitachi Software Engineering and Hitachi Software Engineering received a valuation
report on its equity value (the “Valuation Report for Hitachi Software Engineering”) as
of July 27, 2009 from Mizuho Securities. Mizuho Securities used the market share pricemethod, the comparable company analysis method and the DCF method. Valuation
results on the value per share of common stock of Hitachi Software Engineeringcomputed using each method was as follows. According to Hitachi Software
Engineering, carefully inspected the Tender Offer Price based on these valuation results
and judged the Tender Offer Price to be at an appropriate level and reasonable. Hitachi
Software Engineering did not obtain an opinion on the fairness of the Tender Offer Price,- more --8-

the so-called Fairness Opinion, from Mizuho Securities, according to Hitachi Software
Engineering.
(i) market share price method: ¥1,364 to ¥1,712—¥
According to Hitachi Software Engineering, the average market price method is amethod to compute the equity value of Hitachi Software Engineering based on theshare prices of Hitachi Software Engineering in the stock market. The share prices
are determined through the principle of market competition with many entrants,
widely disclosed and objective. They are taken into account in the valuation ofshare prices of listed companies. For these reasons, this method was employed.
With the average market price method, based on the simple average of closing
prices based on July 24, 2009, the record date, of the common stock of Hitachi
Software Engineering on the First Section of the Tokyo Stock Exchange for the
past six months until the record date, the per share price of the shares of Hitachi
Software Engineering was calculated to be ¥1,364 to ¥1,712.
(ii) Comparable Company Analysis method: ¥1,813 to ¥2,502
According to Hitachi Software Engineering, the comparable company analysis
method is a method to calculate Hitachi Software Engineering’s share price using
multipliers of financial indicators relative to aggregate stock prices of listedcompanies operating in the same business as that of Hitachi Software Engineering.
Taking into account the situation of major markets and business scale, Hitachi
Software Engineering judged that this method would produce probable results andemployed this method. Using the Comparable Company Analysis method, the pershare price of the shares of Hitachi Software Engineering was calculated to be¥1,813 to 2,502—.
(iii) DCF method: ¥2,107 to ¥3,081—
According to Hitachi Software Engineering, the DCF method is a method to
calculate the value of Hitachi Software Engineering’s business and share price by
estimating and discounting future free cash flows that Hitachi Software
Engineering will produce through business activities by a certain discount rate togive their present values. Adding value of non-operating assets to the resulting
Hitachi Software Engineering’s business value and deducting net liabilities, theshare price is derived. Regarding this method as an effective and general financial
theory, Hitachi Software Engineering employed this method. Using the DCF
method, the per share price of the shares of Hitachi Software Engineering was
calculated to be ¥2,107 to ¥3,081—.
According to Hitachi Software Engineering, in view of the above recognition anddiscussions as well as the analyses of the appropriateness of the Tender Offer Price- more --9-and other matters, Hitachi Software Engineering has concluded that the Tender
Offer will contribute to reinforce Hitachi Software Engineering’s operating base,accelerating business strategies and future development, and that the conditions of
the Tender Offer are reasonable, providing Hitachi Software Engineering’s
shareholders with an opportunity to sell their shares at a reasonable price.
Therefore, Hitachi Software Engineering has agreed that Hitachi would conduct theTender Offer with the aim of making Hitachi Software Engineering its wholly
owned subsidiary and further decided to recommend that Hitachi Software
Engineering’s shareholders subscribe to the Tender Offer.
2) Legal advice from law officeAccording to Hitachi Software Engineering, Hitachi Software Engineering received
legal advice from its legal advisor the MIYAKEZAKA SOGO LAW OFFICES on thefairness and appropriateness of the decision-making process of the Board of Directors.
3) Approval of all the directors attending the Board of Directors’ meeting
Furthermore, according to Hitachi Software Engineering, Hitachi Software Engineering
carefully discussed on the Tender Offer at a meeting of its Board of Directors of held
today, which was attended by all Directors who have no vested interest with Hitachi, andresolved to approve the Tender Offer by unanimous approval of the attending Directors
and to recommend that Hitachi Software Engineering’s shareholders subscribe to theTender Offer. Among Hitachi Software Engineering’s Directors, Kotaro Muneoka andKoichiro Nishikawa, who concurrently serve as an advisor or executive officer ofHitachi, respectively, did not participate in the discussion or the decisions with regard to
the Tender Offer to avoid any conflict of interest and refrained from expressing theiropinions at the meeting. In addition, neither has participated in the consultations andnegotiations with Hitachi from the standpoint of being director of Hitachi Software
Engineering.
4) Setting the Tender Offer Period at a relatively long period
By setting the Tender Offer Period at 33 business days, which is a relatively long
period, Hitachi provides the shareholders of Hitachi Software Engineering with theopportunity to fully reflect on the application for the Tender Offer and ensures thefairness of the Tender Offer Price.
(4) Policy on Matters including Organizational Restructuring after the Tender
Offer (Matters concerning the so-called Two-Step Acquisition)
As described in “(1) Outline of the Tender Offer” above, Hitachi aims to make Hitachi- more -- 10 -

Software Engineering a wholly owned subsidiary and intends to acquire all the issued
shares of Hitachi Software Engineering (exclusive of its treasury stock) through theTender Offer and a series of subsequent procedures.
If Hitachi cannot acquire all the issued shares of Hitachi Software Engineering(exclusive of its treasury stock) through the Tender Offer, Hitachi intends to acquire all
the issued shares of Hitachi Software Engineering (exclusive of its treasury stock) byproviding all the shareholders of Hitachi Software Engineering other than Hitachi withthe opportunity of selling Hitachi Software Engineering shares held thereby by thefollowing measures.
Specifically, after the Tender Offer comes into effect, Hitachi intends to request that
Hitachi Software Engineering hold an extraordinary general meeting of shareholders(the “Extraordinary Shareholders’ Meeting”), which would include in the agenda Items
1) through 3) as follows: 1) The Articles of Incorporation of Hitachi Software
Engineering shall be partly amended to make Hitachi Software Engineering a
corporation issuing class shares (shurui kabushiki hakkou kaisha) under the Companies
Act; 2) The Articles of Incorporation of Hitachi Software Engineering shall be partly
amended to the effect that all issued shares of common stock of Hitachi Software
Engineering shall be appended with a call provision (zenbu-shutoku-joko) (a provision
regarding the redeemable right of Hitachi Software Engineering for all the shares as
stipulated in Article 108, Paragraph 1, Item 7 of the Companies Act; hereinafter thesame shall apply); and 3) a different class of Hitachi Software Engineering shares shallbe issued in exchange for acquiring all the stocks with the call provision of Hitachi
Software Engineering (exclusive of its treasury stock).
Furthermore, as Hitachi Software Engineering will become a corporation issuing classshares under the Companies Act on the condition that agenda Item 1) above is approvedby the Extraordinary Shareholders’ Meeting, with respect to agenda Item 2), pursuant to
Article 111, Paragraph 2, Item 1 of the Companies Act, it will be necessary, in addition to
the resolution adopted by the Extraordinary Shareholders’ Meeting, to have a resolution
at a meeting of shareholders with class shares (the “Class Shareholders’ Meeting”), at
which the participants will be shareholders who hold all the stocks with the callprovision of Hitachi Software Engineering. For this purpose, Hitachi will also requestthat Hitachi Software Engineering hold the Class Shareholders’ Meeting to include
agenda Item 2) above for partial amendment to the Articles of Incorporation. Meanwhile,
Hitachi will vote for the respective agenda items above at the Extraordinary
Shareholders’ Meeting and the Class Shareholders’ Meeting.
If all of the above procedures are completed, all shares issued by Hitachi Software
Engineering will be subject to the call provision and shall be acquired by Hitachi- more -- 11 -

Software Engineering (exclusive of its treasury stock) and a different class of Hitachi
Software Engineering shares shall be delivered to such shareholders of Hitachi
Software Engineering as consideration for such acquisition by Hitachi Software
Engineering. Shareholders who are to receive fractions of the different class of Hitachi
Software Engineering shares will receive cash as consideration, which will be obtained
through a sale of the different class of Hitachi Software Engineering shares that
correspond to the sum of all such fractions (including the purchase of a whole or a partof the sum of such fractions by Hitachi Software Engineering) (fractions of theaggregate number to be rounded down) through the procedures pursuant to Article 234of the Companies Act and other applicable laws and regulations. The selling price ofthe different class of Hitachi Software Engineering shares corresponding to the sum of
all such fractions (and the cash amount to be delivered to each of the relevant
shareholders, resulting from the sale of the aggregate number of fractions) is expected
to be calculated on the basis of the Tender Offer Price. Although the class and numberof shares of Hitachi Software Engineering to be delivered as consideration for theacquisition of the stocks with the call provision of Hitachi Software Engineering havenot been determined as of the date hereof, Hitachi intends to request Hitachi Software
Engineering to determine that the shares that must be delivered to shareholders who
have not tendered the Tender Offer other than Hitachi shall be limited to such fractionsof the different class of Hitachi Software Engineering for the purpose of enabling
Hitachi to acquire all the issued shares of Hitachi Software Engineering (exclusive of
its treasury stock).
As provisions to protect the rights of minority shareholders in connection with theabove respective procedures, the Companies Act provides that (i) in the event that the
Articles of Incorporation are partly amended to the effect that all the common stock
issued by Hitachi Software Engineering shall be subject to the call provision as statedin agenda Item 2) above, any shareholder may request that Hitachi Software
Engineering purchase his/her shares in accordance with Articles 116 and 117 of theCompanies Act and other applicable laws and regulations, and that (ii) in the casewhere acquisition of all the stock with the call provision, as described in agenda Item3) above, has been resolved by the General Meeting of Shareholders, any shareholder
may file a petition for determination of a fair price for the acquisition in accordancewith Article 172 of the Companies Act and other applicable laws and regulations. In
addition, the purchase price and the acquisition price per share under (i) and (ii) above
would be determined in the last instance by a competent court.
With regard to the above procedures, there is a possibility that Hitachi may request
Hitachi Software Engineering to conduct another method that would have similareffects depending on such factors as Hitachi’s holding status of Hitachi Software- more -- 12 -Engineering shares after the Tender Offer, the holding status of Hitachi Software
Engineering shares by shareholders other than Hitachi, or the interpretation of thecompetent authorities on the applicable laws and regulations or the like and such steps
might require some time to be successfully completed. Even in such a case, however,Hitachi intends to make Hitachi Software Engineering a wholly owned subsidiary byadopting the method of finally delivering cash to shareholders of Hitachi Software
Engineering other than Hitachi. In such cases, the resulting cash amount to bedelivered to the relevant shareholders is also expected to be calculated on the basis of
the Tender Offer Price.
The Tender Offer is not intended to solicit shareholders of Hitachi Software Engineering
to vote in favor of the proposals to be put to the Extraordinary Shareholders’ Meeting andthe Class Shareholders’ Meeting.
(5) Likelihood of the Delisting of the Shares and the Reasons thereof
As of the date hereof, the common stock of Hitachi Software Engineering is listed on
the First Section of the Tokyo Stock Exchange. As Hitachi has not set the maximum
limit to the number of shares to be purchased through the Tender Offer, Hitachi
Software Engineering shares may be subject to delisting upon the fulfillment of certain
predetermined procedures if the result of the Tender Offer falls under the delisting
standards of the Tokyo Stock Exchange. In addition, even if the delisting standards are
not met upon completion of the Tender Offer, the shares of Hitachi Software
Engineering will be delisted in accordance with the delisting standards because Hitachiintends to hold all the issued shares of Hitachi Software Engineering (exclusive of its
treasury stock) in accordance with the procedures set forth in Item (4) Policy on
Matters including Organizational Restructuring after the Tender Offer (Mattersconcerning the so-called Two-Step Acquisition). Trading of common stock of Hitachi
Software Engineering will become unavailable on the Tokyo Stock Exchange after thedelisting.

(6) Matters concerning Material Agreement regarding the Application to theTender Offer between the Tender Offeror and Shareholders of the Target
Company
Not applicable- more -- 13 -

2. Outline of the Tender Offer and Other Information(1) Outline of the Target Company
Corporate Name
Description ofBusinesses
Date Established
Head Office
Name and Title ofRepresentative
Paid-in Capital

Major Shareholders
and Shareholdings

Relationships between
the Tender Offeror andthe Target Company

Hitachi Software Engineering Co., Ltd.
Development and sales of computer software
Sales of information processing equipment
September 21, 1970
12-7, Higashishinagawa 4-chome, Shinagawa-ku, Tokyo, Japan
Isao Ono, President, Chief Executive Officer¥34,182 million (As of March 31, 2009)
Hitachi, Ltd.

51.34%

Japan Trustee Services Bank, Ltd. (Trust Account)

3.62%

Japan Trustee Services Bank, Ltd. (Trust Account 4G)

3.28%

The Master Trust Bank of Japan, Ltd. (Trust Account)

2.81%

Hitachi Software Engineering Group Employees’
Shareholding Association

2.03%

TAM TWO (Standing proxy: The Bank ofTokyo-Mitsubishi UFJ, Ltd.)

1.40%

Trust & Custody Services Bank, Ltd. (Securities Investment
Trust Account)

1.12%

State Street Bank and Trust Company 505227 (Standing
proxy: Mizuho Corporate Bank, Ltd., Kabuto-cho Securities
Settlement Operation Center)

0.83%

Mellon Bank, N.A. as Agent for its Client Mellon Omnibus
US Pension (Standing proxy: Mizuho Corporate Bank, Ltd.,
Kabuto-cho Securities Settlement Operation Center)

0.75%

State Street Bank and Trust Company 505019 (Standing
proxy: Mizuho Corporate Bank, Ltd., Kabuto-cho Securities
Settlement Operation Center)

0.72%

CapitalRelationships
Personnel
Relationships

Transaction
Relationships(As of March 31, 2009)
Hitachi holds 33,238,836 shares of Hitachi Software
Engineering, equivalent to a shareholding of 51.55% of thetotal number of issued shares, including indirect holdings of
0.20%. (As of March 31, 2009)
One Hitachi executive officer and one advisor sit on Hitachi
Software Engineering’s Board of Directors.
Hitachi conducts sales of electronic computers for sale,etc., to Hitachi Software Engineering and purchases
software and information processing equipment fromthem also. Hitachi receives funds from Hitachi Software
Engineering under the Hitachi Group’s cash poolingsystem.

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Status as a
Related Party

Hitachi Software Engineering is a consolidated
subsidiary of Hitachi, and therefore a Related Party of
Hitachi.

(2) Tender Offer Period1) Initial Period of the Tender Offer in the Registration
From Thursday, August 20, 2009 to Thursday, October 8, 2009 (both inclusive) (33business days)
2) Possibility of Extending the Above Period upon Request of the Target Company
None(3) Tender Offer Price: ¥2,650 per share of common stock(4) Basis of Calculation of the Tender Offer Price
1) Basis of Calculation
For reference in determining the Tender Offer Price, Hitachi requested that Nomura
Securities, a financial adviser as a third-party appraiser independent from Hitachi and
Hitachi Software Engineering, calculate the equity value of Hitachi Software
Engineering. To calculate the equity value of Hitachi Software Engineering, Nomura
Securities used the average market share price method, the comparable company
analysis method and the DCF method. Hitachi received the Valuation Report for
Hitachi today from Nomura Securities (Hitachi did not obtain an opinion on thefairness of the valuation results of the Tender Offer Price, the so-called Fairness
Opinion, from Nomura Securities.) The range of valuations per share of common stockof Hitachi Software Engineering calculated according to each method is as follows.
Average market share price method¥1,364 to ¥1,712

Comparable company analysis method¥1,417 to ¥1,872

DCF method¥2,044 to ¥2,932

First, under the average market share price method, Nomura Securities judged therange per share of common stock to be ¥1,364 to ¥1,712 based on the closing price ofHitachi Software Engineering’s common stock on the First Section of the Tokyo Stock
Exchange on the record date of July 24, 2009, the average closing price for the mostrecent one week, the average closing price for the most recent one month, the average- more -- 15 -

closing price for the most recent three months and the average closing price for themost recent six months.
Secondly, under the comparable company analysis method, Nomura Securities
judged the range per share of common stock to be ¥1,417 to ¥1,872, evaluating Hitachi
Software Engineering’s equity value by comparing share prices and financial indicatorssuch as the profitability of listed companies engaged in relatively similar businesses tothose of Hitachi Software Engineering.
Finally, under the DCF method, Nomura Securities judged the range per share ofcommon stock to be ¥2,044 to ¥2,932 after analyzing enterprise value and equity value
by discounting free cash flows Hitachi Software Engineering is expected to generate in
the future by a certain discount rate to arrive at a net present value. This analysis was
based on Hitachi Software Engineering’s estimated future profits from the fiscal year
ending March 31, 2010 and later, taking into consideration Hitachi Software
Engineering’s business plans, an interview to the management of Hitachi Software
Engineering, recent business performance, public information disclosures and othercontributing factors.
Hitachi took into account the valuation results received from Nomura Securities using
each method in the Valuation Report for Hitachi as a reference and comprehensively
considered examples of premiums added as of determining tender offer prices in pastexamples of tender offers for shares by entities other than issuers; whether the Board of
Directors of Hitachi Software Engineering would accept the Tender Offer; the market
share price trend of Hitachi Software Engineering’s common stock; the expected
number of subscriptions to the Tender Offer; and other factors. Furthermore, taking
into account the results of consultations and negotiations with Hitachi Software
Engineering, the final Tender Offer Price was determined at ¥2,650 per share ofcommon stock by Hitachi’s President and Chief Executive Officer on July 28, 2009.
The Tender Offer Price per share of ¥2,650 represents a premium of 54.8% (rounded
to the first decimal place) on the closing price of ¥1,712 of common stock of Hitachi
Software Engineering on the First Section of the Tokyo Stock Exchange on July 24,
2009 (*). It also represents a premium of 56.9% (rounded to the first decimal place) on
the simple average of ¥1,689 (rounded to the nearest yen) of the closing share prices ofcommon stock of Hitachi Software Engineering for the past month (from June 25 toJuly 24, 2009), a premium of 72.4% (rounded to the first decimal place) on the simple
average of ¥1,537 (rounded to the nearest yen) of the closing share prices of common
stock of Hitachi Software Engineering for the past three months (from April 27 to July24, 2009) and a premium of 94.3% (rounded to the first decimal place) on the simple
average of ¥1,364 (rounded to the nearest yen) of the closing share prices of common- more -- 16 -

stock of Hitachi Software Engineering for the past six months (from January 26 to July24, 2009).
(*)The stock price of Hitachi Software Engineering rose following a news report
regarding the business restructuring of the Hitachi Group on July 27, 2009, which isthe day before the day when the aforementioned decision was made by Hitachi's
President and Chief Executive Officer. Considering this rise in the stock price, thepremium was calculated using the stock price on July 24, 2009, a business day
before July 27, 2009. The calculations of the respective premiums on the simple
average of the closing share prices of common stock for the past one month, for the
past three months and for the past six months were made in the same manner.
2) Background of the Valuation(Background to the decision regarding the Tender Offer Price)
Hitachi Software Engineering, a consolidated subsidiary of Hitachi, currently engages
in software service businesses, including systems development, services and package
products, and information processing equipment business. The Hitachi Group,
including Hitachi, has launched measures earlier than its competitors to addresschanging user needs in its information & telecommunication systems business, with acertain level of successful results.
The Hitachi Group intends to utilize its experience, expertise and technologicalcapability to concentrate on the “social innovation business” that fuses the social
infrastructure business with the information & telecommunication systems business incountries and regions that have already built a certain degree of social infrastructure
which includes power systems, transportation systems, roads and water and otherpublic systems.
However, the domestic information service market is currently at a critical turning
point.
Reflecting a change in the type of interests in system investments, users’ demand for
hardware and software is being replaced by that for information system services,
including the use of packaged software products and systems for shared use, which is
expected to be a driving force in the market. At this turning point, Hitachi believe it
essential that the Hitachi Group quickly make large-scale investments in R&D inadvanced technologies and infrastructure such as data center networks and put in placefoundations that will allow Hitachi to further enhance the global business so that the
Hitachi Group can appropriately cope with market changes and further expand
businesses in the information service market.
Hitachi anticipates that demand for the social innovation business, on which the
Hitachi Group intends to focus its marketing efforts, will expand significantly. Hitachi- more -- 17 -

sees urgent tasks in the business to be the Hitachi Group’s development of products
and packages commensurate with the business and the swift establishment of service
business foundations for the growth of the business. Consequently, Hitachi considers it
necessary that the Hitachi Group invests its management resources in the information& telecommunication systems business.
Under these circumstances, since early April 2009, Hitachi and Hitachi Software
Engineering have worked together and continued to discuss and consider various
measures for business structural reform with a goal of raising their respective
enterprise values. As a result, Hitachi and Hitachi Software Engineering havedetermined that strengthening the collaboration between Hitachi Software Engineeringand the Hitachi Group and promoting the integration of the information
telecommunication systems businesses in the Hitachi Group could be reinforced byestablishing a closer capital relationship between both corporations, and thereby:
1) Hitachi Software Engineering, as a core company in the Hitachi Group, will beable to reinforce its response capabilities to big accounts, expand businesses forleading medium-sized enterprises, and enhance the development of products &packages of market needs, and strengthen its abilities to develop businessfoundations for products & packages and the development of high-quality basic
software and embedded software;
2) Hitachi Software Engineering will be able to strengthen its earning power by utilizing
the Hitachi Group’s human resources, sales and marketing and technologicalcapabilities;
3) Hitachi Software Engineering will be able to further expand its global businesses
through the active utilization of the Hitachi Group’s overseas sales and marketingstrengths; and
4) The social innovation business on which the Hitachi Group focus its efforts will
create and expand new business opportunities by swiftly conducting various
developments required for the business expansion .
Hitachi and Hitachi Software Engineering have reached a conclusion that these effects
will enhance the enterprise value of both companies, and to achieve the intended
effects it is essential to make Hitachi Software Engineering a wholly owned subsidiaryof Hitachi. Therefore, it was decided that Hitachi would conduct the Tender Offer, andthe Tender Offer Price was determined in the following manner.
(i) Name of the Third Party from Which Hitachi Obtained Valuations

In determining the Tender Offer Price, Hitachi around May 2009 requested that
Nomura Securities, a financial adviser as a third-party appraiser independent from- more -- 18 -

Hitachi and Hitachi Software Engineering, calculate the equity value of Hitachi
Software Engineering. Hitachi received the Valuation Report for Hitachi on theequity value of Hitachi Software Engineering on July 28, 2009, from Nomura
Securities. (Hitachi did not obtain an opinion on the fairness of its valuations of theTender Offer Price, the so-called Fairness Opinion, from Nomura Securities.)(ii) Outline of the Valuation Report for Hitachi

To calculate the equity value of Hitachi Software Engineering, Nomura Securities
used the average market share price method, the comparable company analysis
method and the DCF method. The range of valuations per share of common stock of
Hitachi Software Engineering calculated according to each method is as follows.
Average market share price method¥1,364 to ¥1,712

Comparable company analysis method¥1,417 to ¥1,872

DCF method¥2,044 to ¥2,932(iii) Process for Determining the Tender Offer Price Based on the Valuation Reportfor Hitachi
Hitachi took into account the valuation results using each method in the Valuation
Report for Hitachi received from Nomura Securities as reference and comprehensively
considered examples of premiums added as of determining tender offer prices in pastexamples of tender offers for shares by entities other than issuers; whether the Board of
Directors of Hitachi Software Engineering would accept the Tender Offer; the market
share price trend of Hitachi Software Engineering’s common stock; the expected
number of subscriptions to the Tender Offer; and other factors. Furthermore, taking into
account the results of consultations and negotiations with Hitachi Software Engineering,
the final Tender Offer Price was determined at ¥2,650 per share of common stock by
Hitachi’s President and Chief Executive Officer today.
(Measures to Ensure the Fairness of the Tender Offer including Measures to
Ensure the Fairness of the Tender Offer Price and to Avoid Conflicts of Interest)
Hitachi principally took into consideration the following matters to ensure the fairness of
the Tender Offer.

- more -- 19 -(i) Acquisition of the valuation report on the equity value from the Independent
Third-Party Appraiser
In determining the Tender Offer Price, Hitachi requested that Nomura Securities, afinancial adviser and third-party appraiser independent from Hitachi and Hitachi
Software Engineering, calculate the equity value of Hitachi Software Engineering
shares as one of the measures to ensure the fairness of the Tender Offer Price.
To calculate the equity value of Hitachi Software Engineering shares, Nomura
Securities used the average market share price method, the comparable company
analysis method and the DCF method. Hitachi received the Valuation Report for
Hitachi from Nomura Securities today. (Hitachi did not obtain an opinion on thefairness of the valuation results of the Tender Offer Price, the so-called Fairness
Opinion, from Nomura Securities.)
Hitachi took into account the valuation results using each method in the Valuation
Report for Hitachi received from Nomura Securities as a reference andcomprehensively considered examples of premiums added as of determining tender
offer prices in past examples of tender offers for shares by entities other than issuers;whether the Board of Directors of Hitachi Software Engineering would accept theTender Offer; the market share price trend of Hitachi Software Engineering’s common
stock; the expected number of subscriptions to the Tender Offer; and other factors.
Furthermore, taking into account the results of consultations and negotiations with
Hitachi Software Engineering, the final Tender Offer Price was determined at ¥2,650
per share of common stock by Hitachi’s President and Chief Executive Officertoday.
On the other hand, according to Hitachi Software Engineering, in determining an
opinion on the Tender Offer Price, Hitachi Software Engineering had Mizuho
Securities Co., Ltd. (“Mizuho Securities”) calculate its equity value as a measure toensure the fairness of the evaluation of the Tender Offer Price. Mizuho Securities is afinancial advisor as a third-party appraiser independent of Hitachi and Hitachi
Software Engineering, and also does not hold the status as a Related Party. On thisbasis, Mizuho Securities calculated the equity value of Hitachi Software Engineeringand Hitachi Software Engineering received the Valuation Report for Hitachi Software
Engineering as of July 27, 2009 from Mizuho Securities. Mizuho Securities used themarket share price method, the comparable company analysis method and the DCF
method. Per-equity value of common stock of Hitachi Software Engineering computed
using each method was as follows. Hitachi Software Engineering did not obtain an
opinion on the fairness of the Tender Offer Price, the so-called Fairness Opinion, from
Mizuho Securities, according to Hitachi Software Engineering.

- more -- 20 -(i) Average Market Price method:¥1364 to ¥1,712
According to Hitachi Software Engineering, the Average Market Price method is amethod to compute the equity value of Hitachi Software Engineering based on theshare prices of Hitachi Software Engineering in the stock market. The share prices
are determined through the principle of market competition with many entrants,
widely disclosed and objective. They are certainly taken into account in valuationof share prices of listed companies. For these reasons, this method was employed.
With the Average Market Price method, based on the closing price of the common
stock of Hitachi Software Engineering on the First Section of the Tokyo Stock
Exchange on the record date of July 24, 2009 and the simple average of closing
prices for the past six months until the record date, the per share price of theshares of Hitachi Software Engineering was calculated to be ¥1,364 to ¥1,712.
(ii) Comparable Company Analysis method: ¥1,813 to ¥2,502
According to Hitachi Software Engineering, the Comparable Company Analysis
method is a method to calculate Hitachi Software Engineering’s share price using
multipliers of financial indicators relative to aggregate stock prices of listedcompanies operating in the same business as that of Hitachi Software Engineering.
Taking into account the situation of major markets and business scale, Hitachi
Software Engineering judged that this method would produce probable results andemployed this method. Using the Comparable Company Analysis method, the pershare price of the shares of Hitachi Software Engineering was calculated to be¥1,813 to 2,502.
(iii) DCF method: ¥2,107 to 3,081
According to Hitachi Software Engineering, the DCF method is a method to
calculate the value of Hitachi Software Engineering’s business and share price by
estimating and discounting future free cash flows that Hitachi Software
Engineering will produce through business activities by a certain discount rate togive their present values. Adding value of non-operating assets to the resulting
Hitachi Software Engineering’s business value and deducting net liabilities, theshare price is derived. Regarding this method as an effective and general financial
theory, Hitachi Software Engineering employed this method. Using the DCF
method, the per share price of the shares of Hitachi Software Engineering was
calculated to be ¥2,107 to 3,081.
According to Hitachi Software Engineering, in view of the above recognition anddiscussions as well as the analyses of the appropriateness of the Tender Offer Priceand other matters, Hitachi Software Engineering has concluded that the Tender
Offer will contribute to reinforcement of Hitachi Software Engineering’s operating- more -- 21 -

base, accelerating business strategies and future development, and that theconditions of the Tender Offer are reasonable, providing Hitachi Software
Engineering’s shareholders with an opportunity to sell their shares at a reasonable
price. Therefore, Hitachi Software Engineering has agreed that Hitachi would
execute the Tender Offer with the aim of making Hitachi Software Engineering its
wholly owned subsidiary and further decided to recommend that Hitachi Software
Engineering’s shareholders subscribe to the Tender Offer.
(ii) Legal advice from law officeAccording to Hitachi Software Engineering, Hitachi Software Engineering received legal
advice from its legal advisor the MIYAKEZAKA SOGO LAW OFFICES on the fairness
and appropriateness of the decision-making process of the Board of Directors.
(iii) Approval of all the directors attending the Board of Directors’ meeting
Furthermore, according to Hitachi Software Engineering, Hitachi Software Engineering
carefully discussed on the Tender Offer at a meeting of its Board of Directors of held
today, which was attended by all Directors who have no vested interest with Hitachi,
and resolved to approve the Tender Offer by unanimous approval of the attending
Directors and to recommend that Hitachi Software Engineering’s shareholders subscribe
to the Tender Offer. Among Hitachi Software Engineering’s Directors, Kotaro Muneoka
and Koichiro Nishikawa, who concurrently serve as advisor or executive officer ofHitachi, respectively, did not participate in the discussion or the decisions with regard to
the Tender Offer to avoid any conflict of interest and refrained from expressing theiropinions at the meeting. In addition, neither has participated in the consultations andnegotiations with the Hitachi form the standpoint of being director of Hitachi Software
Engineering.
(iv) Setting the Tender Offer Period at a relatively long period
By setting the Tender Offer Period at 33 business days, which is a relatively long
period, Hitachi provides the shareholders of Hitachi Software Engineering with theopportunity to fully reflect on the application for the Tender Offer and ensures thefairness of the Tender Offer Price.
(5) Number of Shares to Be Purchased
Number of Shares to Be
Purchased
29,685,236 shares

Minimum Number of Shares to
Be Purchased— shares- more -Maximum Number of Shares to
Be Purchased— shares- 22 Notes:
1. As the maximum and minimum limits to the number of shares to be purchased through theTender Offer are not set, all of the tendered shares will be purchased.
2. Less-than-one-unit shares (tangen-miman-kabushiki) are also eligible for the Tender Offer. In
addition, Hitachi Software Engineering may purchase its own shares during the Tender Offer
Period, pursuant to applicable laws and regulations, if shareholders owning less-than-one-unit
shares exercise their right to request purchase of their shares in accordance with the relevant
provisions of the Companies Act.
3. Hitachi does not intend to acquire treasury stock held by Hitachi Software Engineering throughthe Tender Offer.
4. The maximum number of shares of Hitachi Software Engineering to be acquired by Hitachi
through the Tender Offer is stated in the “Number of Shares to Be Purchased.” This number
indicates Hitachi Software Engineering shares (29,685,236 shares) (the “Maximum Number of
Shares to Be Purchased”) that are to be obtained by deducting the total of the number of shares
held by Hitachi as of the date hereof (33,107,000 shares) and the number of shares of treasury
stock held by Hitachi Software Engineering as of March 31, 2009 (1,687,145 shares), from thetotal number of issued shares of Hitachi Software Engineering as of March 31, 2009
(64,479,381 shares), which are stated in the securities report of the 39th term filed by Hitachi
Software Engineering on June 26, 2009.

(6) Changes in the Shareholdings due to the Tender Offer
Number of voting rights represented byshares held by the Tender Offeror
immediately before the Tender Offer
Number of voting rights represented byshares held by Special Related Parties
immediately before the Tender Offer
Number of voting rights represented byshares to be purchased by the Tender Offer
Total number of voting rights held by all theshareholders in the Target Company

331,070 units— units
296,852 units(Shareholdings immediately
before the Tender Offer: 52.72%)(Shareholdings immediately
before the Tender Offer: — %)(Shareholdings after theTender Offer: 100.00%)

627,412 units

Notes:
1. The "Shareholdings immediately before the Tender Offer" was calculated using the "Total
number of voting rights held by all the shareholders in the Target Company" as thedenominator.
2. The “Number of voting rights represented by shares held by Special Related Parties
immediately before the Tender Offer” represents the total of voting rights relating to shares
held by respective Special Related Parties as identified by Hitachi as of the date hereof.
Provided, however, that such Special Related Parties shall exclude those to be excluded fromthe category of Special Related Parties (the “Small-Scale Owners”) in accordance with Article
3, Paragraph 2, Item 1 of the Cabinet Office Ordinance regarding Disclosure of Tender Offers
for Shares, etc., by Entities Other than Issuers (Ministry of Finance Ordinance No. 38 of 1990;
including amendment thereof; the “Ordinance”) in calculating the shareholdings, as set forth in
the respective items of Article 27-2, Paragraph 1 of the Financial Instruments and Exchange
Law (Law No. 25 of 1948; including amendment thereof; the “Law”).
3. The “Number of voting rights represented by shares to be purchased by the Tender Offer”
indicates the number of voting rights relating to the number of shares to be purchased in theTender Offer (29,685,236 shares).
4. Because the shares held by respective Special Related Parties (exclusive of its treasury stock
held by Hitachi Software Engineering being a Special Related Party) are also subject to the- more -- 23 -

Tender Offer, the “Number of voting rights represented by shares held by Special Related
Parties immediately before the Tender Offer” is not included in the numerator in the calculationof “Shareholdings after the Tender Offer.”
5. The “Total number of voting rights held by all the shareholders in the Target Company” (100shares represent the number of shares per unit (tangen)) indicates the number of voting rights
of all the shareholders of Hitachi Software Engineering as of March 31, 2009, which is statedin the securities report of the 39th term filed by Hitachi Software Engineering on June 26, 2009.
Because all the shares issued by Hitachi Software Engineering (exclusive of treasury stock heldby Hitachi Software Engineering) are subject to the Tender Offer, the “Shareholdings after theTender Offer” were calculated using the number of voting rights (627,922 units) relating to thenumber of shares of Hitachi Software Engineering (62,792,236 shares)—which corresponds tothe number derived by deducting the number of its treasury stock as of March 31, 2009
(1,687,145 shares) from the total number of issued shares of Hitachi Software Engineering asof March 31, 2009 (64,479,381 shares) stated in said securities report—as the denominator.
6. The figures in the “Shareholdings immediately before the Tender Offer” and the“Shareholdings after the Tender Offer” were rounded to two decimal places.

(7) Tender Offer Cost: ¥78,666 million
Note: The Tender Offer Cost is calculated by multiplying 29,685,236 shares (Number of Shares to
Be Purchased) by the Tender Offer Price for each share of ¥2,650.

(8) Method of Settlement
1) Name and Location of Head Office of Securities Companies/Banks, etc., in
Charge of Settlement
Nomura Securities Co., Ltd.
9-1, Nihonbashi 1-chome, Chuo-ku, Tokyo
JOINVEST Securities Co., Ltd. (Sub-Agent)
15-1, Konan 2-chome, Minato-ku, Tokyo

2) Commencement Date of Settlement
Friday, October 16, 20093) Method of Settlement
With respect to tendering shareholders through the Tender Offer Agent, upon expiration of
the Tender Offer Period, Hitachi will, without delay, send notice of the Tender Offer
purchases to the addresses of tendering shareholders (in the case of a foreign resident who
does not hold a working account with the Tender Offer Agent including the case of an
institutional shareholder, to its standing proxy). With respect to tendering shareholders
through JOINVEST Securities Co., Ltd., the Sub-Agent, the notice will be delivered inaccordance with the method described on the Sub-Agent’s website (https://www.joinvest.jp/).
- more -- 24 -

Purchases will be made in cash. Payment for purchased shares will be made by meansof remittance, etc., in accordance with the instructions of tendering shareholders. (Feesmay be incurred for remitting payment.)4) Method of Returning Shares
In the event that Hitachi does not purchase all of the tendered shares in accordance withthe conditions mentioned in “2) Conditions of Withdrawal of Tender Offer, Details
thereof and Method of Disclosing the Withdrawal” of “(9) Other Conditions andMethods of the Tender Offer” below, Hitachi will return shares by recovering the record
to the status immediately before the shares were tendered, soon after the commencement
date of settlement (if the Tender Offer is withdrawn, the date of withdrawal). (If sharesare to be transferred to an account of a tendering shareholder at another securities
company, etc., please provide instructions to that effect.)(9) Other Conditions and Methods of the Tender Offer
1) Conditions and Details in Each Item of Article 27-13, Paragraph 4 of the Law
As the maximum and minimum limits to the number of shares to be purchased throughthe Tender Offer are not set, Hitachi will purchase all of the tendered shares.
2) Conditions of Withdrawal of the Tender Offer, Details thereof and Method ofDisclosing the Withdrawal
Upon the occurrence of any event falling under the provisions of Article 14, Paragraph
1, Items 1.1 or 1.9 and 1.12 or 1.18, Item 2, Items 3.1 or 3.8, Item 4, Item 5 and Article
14, Paragraph 2, Items 3 or 6 of the Enforcement Regulations of the Financial
Instruments and Exchange Law (Regulation No. 321 of 1965; including amendment
thereof; the “Enforcement Regulations”), Hitachi may withdraw the Tender Offer. If
Hitachi decides to withdraw the Tender Offer, Hitachi will make a public noticeelectronically, and publish a notice in the Nihon Keizai Shimbun. Provided, however,that if it is difficult to make such a public notice by the end of the Tender Offer Period,
Hitachi will make an announcement as provided for in Article 20 of the Ordinance andthereafter give notice without delay.
3) Conditions for Reducing the Tender Offer Price, Details thereof and Method ofDisclosing the Reduction
If Hitachi Software Engineering takes any actions provided for in Article 13, Paragraph
1 of the Enforcement Regulations during the Tender Offer Period in accordance withthe provisions of Article 27-6, Paragraph 1, Item 1 of the Law, the Tender Offer Price- more -- 25 -

may be reduced in accordance with the provisions of Article 19, Paragraph 1 of theOrdinance. If Hitachi decides to reduce the Tender Offer Price, Hitachi will make apublic notice electronically, and publish a notice in the Nihon Keizai Shimbun.
Provided, however, that if it is difficult to make such a public notice by the end of theTender Offer Period, Hitachi will make an announcement as provided for in Article 20of the Ordinance and thereafter give notice without delay. If the Tender Offer Price isreduced, the shares tendered before the public notice, will also be purchased at the
reduced Tender Offer Price.
4) Matters concerning Tendering Shareholders’ Rights to Cancel Agreements
Any tendering shareholder may cancel agreements relating to the Tender Offer at any
time during the Tender Offer Period. If tendering shareholders who tendered for sharesthrough the Tender Offer Agent intend to cancel agreements relating to the Tender
Offer, they should deliver or send a Cancellation Statement for Tender Offer
Agreement (the “Cancellation Statement”) along with the tender offer application
acceptance receipt to the head office or nationwide branch offices of the Tender Offer
Agent who accepted the application, by 3:30 p.m. on the last day of the Tender Offer
Period. Provided, however, that cancellations sent by tendering shareholders, mustreach the said offices by no later than 3:30 p.m. on the last day of the Tender Offer
Period. If tendering shareholders who tendered for share through JOINVEST Securities
Co., Ltd., the Sub-Agent, intend to cancel agreements relating the Tender Offer, theymust complete the cancellation procedures by 3:30 p.m. on the last day of the Tender
Offer Period in accordance with the instructions on the Sub-Agent’s website(https://www.joinvest.jp/).
The agents with the authority to receive a Cancellation Statement:
Nomura Securities Co., Ltd.
9-1, Nihonbashi 1-chome, Chuo-ku, Tokyo(other nationwide branch offices in Japan)
JOINVEST Securities Co., Ltd. (Sub-Agent)
15-1, Konan 2-chome, Minato-ku, Tokyo
Hitachi will not make any claim for damages or the payment of penalties to a tendering
shareholder if a tendering shareholder cancels an agreement. In addition, Hitachi willbear the costs of returning tendered shares.

- more -- 26 -

5) Method of Disclosure if Conditions, etc., of the Tender Offer are Changed
If Hitachi decides to change the Tender Offer conditions, etc., the Hitachi will make apublic notice electronically, and publish a notice in the Nihon Keizai Shimbun detailingthe changes. Provided, however, that it is difficult to make such a public notice by theend of the Tender Offer Period, Hitachi will make an announcement as provided for in
Article 20 of the Ordinance and thereafter give notice without delay. If Tender Offer
conditions, etc., are changed, shares tendered before the public notice will also bepurchased under the amended conditions.
6) Method of Disclosure When Submitting an Amendment Statement
If an Amendment Statement is filed with the Director of the Kanto Local Finance
Bureau in Japan, Hitachi will immediately announce details from the Amendment
Statement that relate to the contents of the public notice of the commencement of theTender Offer, in accordance with the manner prescribed by Article 20 of the Ordinance.
Hitachi will also immediately change the Tender Offer Explanatory Statement anddeliver the amended document to tendering shareholders who have already received
the Tender Offer Explanatory Statement. However, if the changes are only minor innature, Hitachi will prepare a document stating the reasons for such amendments, theitems that have been amended and the details, and deliver said document to tendering
shareholders.
7) Method of Disclosing Tender Offer Results
Hitachi will publicly announce the results of the Tender Offer the day after the last dayof the Tender Offer Period, in accordance with the provisions of Article 9-4 of the
Enforcement Regulations and of Article 30-2 of the Ordinance.
(10) Date of Public Notice of Commencement of the Tender Offer
Thursday, August 20, 2009(11) Tender Offer Agent
Nomura Securities Co., Ltd.
9-1, Nihonbashi 1-chome, Chuo-ku, Tokyo
To delegate a part of its duties, the Tender Offer Agent has appointed the following
company as a Sub-Agent:
JOINVEST Securities Co., Ltd. (Sub-Agent)
15-1, Konan 2-chome, Minato-ku, Tokyo- more -- 27 -

3. Management Policy and Outlook after the Tender Offer(1) Management Policy after the Tender Offer
Refer to “1. Purpose of the Tender Offer” with regard to the management policy after
the Tender Offer.
(2) Outlook for Future Business Performance after the Tender Offer
The expected impact of the Tender Offer on the Hitachi Group’s business results will
be announced as soon as it is determined.

4. Other Information(1) Agreement between the Tender Offeror and the Target Company and/or Its
Directors
According to Hitachi Software Engineering, Hitachi Software Engineering resolved toapprove the Tender Offer and to recommend that Hitachi Software Engineering’s
shareholders subscribe to the Tender Offer by unanimous approval at a meeting of its
Board of Directors held on July 28, 2009 where all of the Directors of Hitachi Software
Engineering except Kotaro Muneoka and Koichiro Nishikawa, who concurrently serveas advisor or executive officer of Hitachi, respectively, participated in the discussions
and the resolution.
Refer to “(2) Decision-Making Process of the Tender Offer, and Management Policy after
the Tender Offer” and “(3) Measures to Ensure the Fairness of the Tender Offer including
Measures to Ensure the Fairness of the Tender Offer Price and to Avoid Conflicts ofInterest” of “1. Purpose of the Tender Offer” with regard to the “Decision-Making Processof the Tender Offer” and “Details of Measures to Avoid Conflicts of Interest.”(2) Other Information Considered Necessary for Helping Investors Decide
Whether to Subscribe to the Tender Offer
Hitachi Software Engineering publicly announced its closing of accounts information
for the first quarter of the 40th fiscal term on July 23, 2009, at the Tokyo Stock
Exchange. A summary of Hitachi Software Engineering’s consolidated operating
results and other financial information based on this release is provided below. The
summary of this disclosed information is an excerpt of the announcement released by
Hitachi Software Engineering, and Hitachi is not in a position to independently verify
the precision and truthfulness thereof and has not verified it, in effect.

- more -- 28 -

1) Operating Results (millions of yen)First Quarter of 40th Business Period(From April 1, 2009 to June 30, 2009)
31,372
24,764
5,897
299
55
689

Accounting Period
Revenue
Cost of sales
Selling, general and administrative expenses
Non-operating income
Non-operating expenses
Net income
Note: Revenue exclude consumption tax, etc.

2) Data per Share (yen)Accounting Period

First Quarter of 40th Business Period(From April 1, 2009 to June 30, 2009)

Net income per share
Dividend per share
Net assets per share

10.97―
1819.11- more -- 29 -

Cautionary Statement
Certain statements found in this document may constitute “forward-looking statements” as defined in
the U.S. Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” reflect
management’s current views with respect to certain future events and financial performance and include
any statement that does not directly relate to any historical or current fact. Words such as “anticipate,”“believe,” “expect,” “estimate,” “forecast,” “intend,” “plan,” “project” and similar expressions whichindicate future events and trends may identify “forward-looking statements.” Such statements are basedon currently available information and are subject to various risks and uncertainties that could cause
actual results to differ materially from those projected or implied in the “forward-looking statements”
and from historical trends. Certain “forward-looking statements” are based upon current assumptions of
future events which may not prove to be accurate. Undue reliance should not be placed on“forward-looking statements,” as such statements speak only as of the date of this document.
Factors that could cause actual results to differ materially from those projected or implied in any“forward-looking statement” and from historical trends include, but are not limited to:
-

-

-

-

economic conditions, including consumer spending and plant and equipment investments in Hitachi’smajor markets, particularly Japan, Asia, the United States and Europe, as well as levels of demand in the
major industrial sectors which Hitachi serves, including, without limitation, the information, electronics,
automotive, construction and financial sectors;
fluctuations in product demand and industry capacity, particularly in the Information &Telecommunication Systems segment, the Electronic Devices segment and the Digital Media &Consumer Products segment;
increased commoditization of information technology products and digital media related products andintensifying price competition for such products, particularly in the Information & Telecommunication
Systems segment, the Electronic Devices segment and the Digital Media & Consumer Products
segment;
uncertainty as to Hitachi’s ability to continue to develop and market products that incorporate newtechnology on a timely and cost-effective basis and to achieve market acceptance for such products;
rapid technological innovation, particularly in the Information & Telecommunication Systems segment,
the Electronic Devices segment and the Digital Media & Consumer Products segment;
exchange rate fluctuation for the yen and other currencies in which Hitachi makes significant sales or inwhich Hitachi’s assets and liabilities are denominated, particularly against the U.S. dollar and the euro;
fluctuations in the price of raw materials including, without limitation, petroleum and other materials,
such as copper, steel, aluminum and synthetic resins;
uncertainty as to Hitachi’s ability to implement measures to reduce the potential negative impact offluctuations in product demand, exchange rate and/or price of raw materials;
general socio-economic and political conditions and the regulatory and trade environment of Hitachi’smajor markets, particularly Japan, Asia, the United States and Europe, including, without limitation,
direct or indirect restrictions by other nations on imports, or differences in commercial and businesscustoms including, without limitation, contract terms and conditions and labor relations;
uncertainty as to Hitachi’s access to, or ability to protect, certain intellectual property rights, particularly
those related to electronics and data processing technologies;
uncertainty as to the outcome of litigation, regulatory investigations and other legal proceedings of which
the Company, its subsidiaries or its equity method affiliates have become or may become parties;
the possibility of incurring expenses resulting from any defects in products or services of Hitachi;
uncertainty as to the success of restructuring efforts to improve management efficiency and to strengthen
competitiveness;
uncertainty as to the success of alliances upon which Hitachi depends, some of which Hitachi may notcontrol, with other corporations in the design and development of certain key products;
uncertainty as to Hitachi’s ability to access, or access on favorable terms, liquidity or long-term
financing; and- more -- 30 -

uncertainty as to general market price levels for equity securities in Japan, declines in which may require
Hitachi to write down equity securities it holds.

The factors listed above are not all-inclusive and are in addition to other factors contained in Hitachi’s
periodic filings with the U.S. Securities and Exchange Commission and in other materials published by
Hitachi.
Other Cautionary Matters- In accordance with the provisions of Article 167, Paragraph 3 of the Financial Instruments andExchange Law and Article 30 of its Enforcement Regulations, anyone having read this news releaseis considered a primary recipient of information from the viewpoint of insider trading regulations.
Hitachi accordingly urges you to exercise due care as you may be prohibited from purchasing theshares of Hitachi Software Engineering before 12 hours have passed from the time of thisannouncement. If you are held liable under criminal, civil, or administrative laws for making such aprohibited purchase, Hitachi notes that it will assume no responsibility whatsoever.
- This news release is to announce the Tender Offer and has not been prepared for the purpose ofsoliciting an offer to sell shares. If shareholders wish to make an offer to sell their shares, they should
first read the Explanatory Document for the Tender Offer and make their own decision. This news
release does not constitute, nor form part of, any offer or invitation to buy, sell, exchange orotherwise dispose of, or issue, or any solicitation of any offer to sell or issue, exchange or otherwise
dispose of, buy or subscribe for, any securities. In addition, this news release does not constitute, orform part of, any offer or invitation to sell, or any solicitation of any offer to purchase any securities
in any jurisdiction, nor shall it (or any part of it) or the fact of its distribution form the basis of or be
relied on in connection with any agreement thereof.
- The Tender Offer is targeted at the common stock of Hitachi Software Engineering, a company
incorporated in Japan. The Tender Offer is to be conducted in compliance with the procedures andinformation disclosure standards prescribed in the Financial Instruments and Exchange Law of Japan.
These procedures and standards are not necessarily the same as the procedures and information
disclosure standards in the United States. In particular, Section 13(e) and Section 14(d) of the U.S.
Securities and Exchange Act of 1934 and the regulations stipulated there under are not applicable to
the Tender Offer and the Tender Offer does not conform to those procedures and standards. Not all
financial information included in this news release is in conformity with the U.S. GAAP. Further,as the Tender Offeror is a company incorporated outside the U.S. and most officers of the Tender
Offeror are residents outside the U.S., it may be impossible to exercise rights and claims that may beasserted under the securities-related laws of the U.S. There is also a chance that it may be difficult toinstitute proceedings in a court outside the U.S. against a company outside the U.S. or its officers
based on a violation of the securities-related laws of the U.S. Additionally, there is no guarantee that
it would be possible to make a company outside the U.S. and its subsidiary or affiliate subject to thejurisdiction of a U.S. court.
- Some countries or regions may impose restrictions on the announcement, issue or distribution of thisnews release. In such cases, please take note of such restrictions and comply with them. In countries
or regions where the implementation of the Tender Offer is illegal, even upon receiving this news
release, such receipt shall not constitute a solicitation of an offer to sell or an offer to buy shares
relating to the Tender Offer and shall be deemed a distribution of materials for informative purposes
only.

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Information contained in this news release is current asof the date of the press announcement, but may be subject
to change without prior notice.
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