IR News｜News

 Okayama,Japan,August 8,2002-Benesse Corporation today announced its acquisition of a 24.82-percent equity stake in UP Inc., an educational service company mainly offering juku schools(after school preparatory school) based in Hyogo prefecture, and the conclusion of a collaboration agreement with the company.The transactions were approved this morning by the Benesse and UP Inc. boards of directors.

Under the purchase agreement, Benesse acquired 2.1 million shares of UP Inc. common stock, representing 24.82% of the company's total outstanding shares, for a total purchase price of 1,058.4 million yen1 from Maruyu Co., Ltd., thereby replacing it as UP Inc.'s largest shareholder.At the same time, Benesse and UP Inc. agreed to enter into a collaborative alliance to more effectively deploy the companies' management resources and to further enhance the quality and reliability of the educational services offered to customers in Japan.

Benesse and UP Inc. agreed to join forces in order to better respond to the growing demand for innovative private-sector educational services. The recent adoption of curricular reforms to Japan's public education system, and the continuing debate over educational objectives and philosophies, has prompted increased scrutiny of private educational services as well.Parents and guardians increasingly regard these services as a necessity adjunct to the public school system; in turn, the educational industry is expanding into a variety of educational fields. Benesse and UP Inc. are committed to jointly developing educational venues and products that will provide the foundation for today's children to grow into adults with global perspectives and skills, who are at ease in international settings.

Benesse and UP Inc. have agreed to focus on the following five areas for cooperation:
1)Information exchanges: The companies will share information and operational knowhow.
2)Market expansion: Benesse and UP Inc. will join forces to expand UP Inc.'s operations in regions other than the Kansai area, an UP Inc. stronghold, including Juku schools (after-school preparatory schools), "Science Lab" classes for learning science and conducting experiments, and "Edison Club" handicraft workshops.
3)Development of new educational curricula: Benesse and UP Inc. will jointly develop new curricula, educational materials and methods, including learning through hands-on experience and active discussion.
4)Joint research: The two companies will collaborate in researching future educational trends and their target operations.
5)Personnel exchanges: Benesse and UP Inc. will engage in intercompany personnel exchanges. To initiate this program, UP Inc. President Masakatsu Kinoshita will assume the position of Benesse's advisor as of September 1, 2002.

Benesse expects its equity participation in UP Inc. to contribute a slight impact on estimated results for the fiscal year ending March 31, 2003.

About UP Inc.
Address: 15-41 Takamatsu-cho, Nishinomiya-shi, Hyogo prefecture
Established in October 18, 1977, UP Inc. (JASDAQ 9630) develops and markets educational materials, operates Juku and other extracurricular schools, and provides educational services to a wide range of age groups from toddlers to adults. The company had annual sales of 5,173 million yen and ordinary income of 856 million yen in fiscal 2001, and employs 212 people. Its paid-in capital stood at 1,640 million yen as of March 31, 2002.

Note 1:
The per-share purchase price of 504 yen was calculated based on the average of closing price quotations during the month preceding August 1, 2002. The payment of 1,058,400,000 yen was also made to Maruyu on August 8, 2002.