Relevant Press Releases

FOR IMMEDIATE RELEASE
Media Contacts:  Yasuhiro Fukagawa, International PR, Tokyo
                (Tel: 03-3578-1237, Fax: 03-5472-7608)

Matsushita to Make Two Group Companies Wholly-Owned Subsidiaries

---

     Matsushita Electric Industrial Co., Ltd. (MEI [NYSE and PCX symbol: MC]) announced that, upon resolutions adopted at respective Board of Directors meetings held today, MEI and each of Matsushita Electronic Components Co., Ltd. (MACO) and Matsushita Battery Industrial Co., Ltd. (MBI) have entered into share exchange agreements pursuant to the Commercial Code of Japan, to transform MACO and MBI into wholly-owned (100% share ownership) subsidiaries of MEI.
 
     The share exchange agreements will be subject to, and submitted for, approval at the extraordinary general meetings of shareholders of MACO and MBI, scheduled to be held on November 19, 2002. Upon approval, the share exchanges will be implemented on April 1, 2003.
 

1.	Purpose of Share Exchanges

     The Matsushita Group is implementing a comprehensive business and organizational restructuring through such initiatives as transforming five of its Group companies* into wholly-owned subsidiaries of MEI, effective October 1, 2002, aiming at maximizing overall corporate value through establishment and practice of integrated strategies at each business domain. In line with such restructuring initiatives, MEI will transform MACO and MBI into its wholly-owned subsidiaries via share exchanges in order to realize a more flexible and agile operational structure in the components and devices area that contribute to the further strengthening of the overall Group management.
 

*	Matsushita Communication Industrial Co., Ltd., Kyushu Matsushita Electric Co., Ltd., Matsushita Seiko Co., Ltd., Matsushita Kotobuki Electronics Industries, Ltd. and Matsushita Graphic Communication Systems, Inc.

2.	Terms and Conditions of Share Exchanges

A.

Schedule

September 26, 2002 Boards of directors approve share exchange agreements September 26, 2002 Signing of share exchange agreements November 19, 2002 (planned) Shareholder approval of share exchange agreements at respective extraordinary general meetings of shareholders of MACO and MBI March 31, 2003 (planned) Due date for submission of share certificates of MACO and MBI April 1, 2003 (planned) Share exchanges

B.	Share Exchange Ratios

     MEI and each of MACO and MBI entered into the share exchange agreements with the following share exchange ratios.
 
     In the event any material changes arise in assets or management conditions of the companies involved, the parties will collaborate on adjusting the exchange ratios to reflect such changes.
 

Company	MEI (to be 100% parent company)	MACO (to be 100% subsidiary)	MBI (to be 100% subsidiary)
Exchange Ratio	1	0.476	0.945

Notes:		1.		The share exchange ratios were determined based on analysis provided by Nomura Securities Co., Ltd. (Nomura Securities), the financial advisor for MEI, MACO and MBI. Nomura Securities considered and used such methods as market price analysis, net worth method and discounted cash flow analysis regarding MEI. In valuating MACO and MBI, Nomura Securities considered and used such methods as comparable company method, net worth method and discounted cash flow analysis.
		2.		No shares of MEI shall be allotted to shares of MACO and MBI held by MEI.

C.	New MEI Shares to be Issued for the Share Exchanges

     MEI will issue new shares of its common stock in an amount equal to 0.476 shares and 0.945 shares, respectively, per share of common stock of MACO and MBI held by shareholders (excluding MEI) of record as of the close of the day immediately preceding the date of share exchanges.
 

D.	Cash Distribution Upon Share Exchanges

     There will be no cash distribution in relation to the share exchanges.
 

E.	Increases in Capital Stock and Capital Reserve

     The capital stock of MEI will not increase as a result of the share exchanges. The increase in MEI's capital reserve is obtained by multiplying shareholders' equity of each of MACO and MBI at the time of the share exchange by a ratio of shares to be transferred to MEI in the share exchanges to the total number of outstanding shares of each of MACO and MBI.
 

3.	Basic Information for MEI, MACO and MBI (non-consolidated basis)

(as of March 31, 2002)

Trade Name MEI MACO MBI Principal Lines of Business Manufacture and sale of electronic and electric equipment Manufacture and sale of electronic components, equipment and parts and materials Manufacture and sale of batteries, battery operated products and battery parts and components Date of Incorporation December 15, 1935 January 19, 1976 January 16, 1979 Principal Office Kadoma-shi, Osaka, Japan Kadoma-shi, Osaka, Japan Moriguchi-shi, Osaka, Japan Representative Kunio Nakamura, President Koshi Kitadai, President Toru Ishida, President Capital Stock (million yen) 258,737 23,012 10,500 Shares Issued 2,138,514,603 304,500,000 210,000,000 Shareholders' Equity (million yen) 2,553,374 79,614 138,183 Total Assets (million yen) 4,565,972 242,741 199,557 Financial Closing Date March 31 March 31 March 31 Employees 49,513 5,848 3,792 Major Customers Consumer products-- distributed mainly through consumer sales networks. Business and industrial equipment and components-- sold mainly to corporations, government agencies and manufacturers through various other sales networks. MEI MEI Major Shareholders and Shareholdings Sumitomo Mitsui Banking 4.56%     Japan Trustee Services Bank (Trust account)   4.52% Moxley & Co. 4.45%     Sumitomo Life Insurance 3.58%     Mitsubishi Trust and Banking (Trust account)   3.16% MEI 99.20% MEI 97.90% Major Banks Sumitomo Mitsui Banking, The Asahi Bank, etc. Sumitomo Mitsui Banking, The Asahi Bank, etc. Sumitomo Mitsui Banking, The Asahi Bank, etc.

Note: Amounts less than one million yen have been omitted. (hereinafter the same)
 

4.	Financial Results for the Most Recent Three Fiscal Years (non-consolidated basis)

(in millions of yen, except per share amounts)

Matsushita Electric Industrial Co., Ltd. (to be 100% parent company) Matsushita Electronic Components Co., Ltd. (to be 100% subsidiary) Fiscal Year ended 2000/3 2001/3 2002/3 2000/3 2001/3 2002/3 Net Sales 4,553,223 4,831,866 3,900,790 314,838 352,795 230,396 Operating Profit (Loss) 75,228 76,634 (92,952) 4,479 16,097 (23,721) Recurring Profit (Loss) 113,536 115,494 (42,480) 837 10,307 (26,928) Net Income (Loss) 42,349 63,687 (132,410) 7,110 7,151 (28,514) Net Income (Loss) per Share (in yen) 20.53 30.63 (63.79) 23.35 23.49 (93.64) Annual Dividends per Share (in yen) 12.50 12.50 10.00 -- 5.00 -- Shareholders' Equity per Share (in yen) 1,248.31 1,306.37 1,225.39 336.62 360.11 261.46

	Matsushita Battery Industrial Co., Ltd. (to be 100% subsidiary)
Fiscal Year ended	2000/3	2001/3	2002/3
Net Sales	232,478	216,011	173,503
Operating Profit (Loss)	20,558	17,058	(8,074)
Recurring Profit (Loss)	20,935	19,573	(8,501)
Net Income (Loss)	9,144	10,129	(22,832)
Net Income (Loss) per Share (in yen)	43.54	48.23	(108.72)
Annual Dividends per Share (in yen)	10.00	10.00	7.50
Shareholders' Equity per Share (in yen)	739.01	777.08	658.02

5.	Changes after Share Exchanges

A.	Trade Names, Principal Lines of Business, Principal Offices and Representatives

     In regards to trade names, principal lines of business, principal offices and representatives, there will be no immediate changes in the information outlined in "3. Basic Information for MEI, MACO and MBI."
 

B.	Effects on MEI's Consolidated Financial Results

     The share exchanges will have no material effect on MEI's parent-alone or consolidated sales and earnings.
 
Disclaimer Regarding Forward-Looking Statements
     This press release includes forward-looking statements (within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934) about Matsushita and its group companies (the Matsushita Group). To the extent that statements in this press release do not relate to historical or current facts, they constitute forward-looking statements. These forward-looking statements are based on the current assumptions and beliefs of the Matsushita Group in light of the information currently available to them, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the Matsushita Group's actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. Matsushita undertakes no obligation to publicly update any forward-looking statements after the date of this press release. Investors are advised to consult any further disclosures by Matsushita in its subsequent filings with the U.S. Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934 and its other filings.
     The risks, uncertainties and other factors referred to above include, but are not limited to, economic conditions, particularly consumer spending and corporate capital expenditures in the United States, Europe, Japan and other Asian countries; volatility in demand for electronic equipment and components from business and industrial customers, as well as consumers in many product and geographical markets; currency rate fluctuations, notably between the yen, the U.S. dollar, the euro, Asian currencies and other currencies in which the Matsushita Group operates businesses, or in which assets and liabilities of the Matsushita Group are denominated; the ability of the Matsushita Group to respond to rapid technological changes and changing consumer preferences with timely and cost-effective introductions of new products in markets that are highly competitive in terms of both price and technology; the ability of the Matsushita Group to realize expected benefits of various restructuring activities in its business and organization, including the share exchanges with subsidiaries currently in progress; the ability of the Matsushita Group to achieve its business objectives through joint ventures and other collaborative agreements with other companies; the ability of the Matsushita Group to maintain competitive strength in many product and geographical areas; any changes in the Matsushita Group's financial and operational position or business environment due to its business restructuring; current and potential, direct and indirect trade restrictions imposed by other countries; and fluctuations in market prices of securities and other assets in which the Matsushita Group has holdings, as well as future changes or revisions to accounting policies or accounting rules.
 

---