Sony and Epson announce agreement on TFT business

Epson and Sony have discussed a possible agreement in the field of small-and medium-sized TFT LCDs since their March 2009 announcement. As further detailed below, the agreement announced today calls for certain assets of the Epson group to be transferred to the Sony group, subject to receipt of necessary government approvals. Placing top priority on continuing to meet customer requirements, the sales function for small- and medium-sized TFT LCD business operated by Epson Imaging will first be transferred to the Sony group within 2009. Thereafter, it is planned that certain manufacturing-related assets for such business owned by Epson Imaging will be transferred to Sony Mobile Display Corporation ("SMD") on April 1, 2010, from which time they will be operated by the Sony group.

In addition to the Sony group’s existing expertise in sales, development, design and production of high-resolution low-temperature polysilicon TFT LCDs, the transfer of these business assets will enable Sony to fully utilize Epson Imaging and other Epson group capabilities in the field of small-and medium-sized TFT LCD sales, technology and product design and amorphous silicon TFT LCD production. By producing a wider range of technically advanced and cost effective products, and offering comprehensive small- and medium-sized TFT LCD product lineups, the Sony group expects to enhance its customer relationships and strengthen the competitiveness of its small- and medium-sized TFT LCD business.

The Epson group will work to assure a smooth and expeditious transfer of the business assets, and will continue to work closely with the Sony group to facilitate the further growth and success of the small- and medium-sized TFT LCD business.

There will be no payment for the transfer of such business assets. No material impact on either Epson’s or Sony’s financial results for the current fiscal year for the transactions is anticipated. Any future impact on financial result for the fiscal year ending March 31, 2011 and beyond is being assessed.