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KDDI, TEPCO Agree to Integrate FTTH Business

KDDI Corporation
Tokyo Electric Power Company


KDDI Corporation (represented by President and Chairman Tadashi Onodera, hereinafter referred to as "KDDI") and Tokyo Electric Power Company (represented by President Tsunehisa Katsumata, hereinafter referred to as "TEPCO") have today agreed to integrate the business activities of TEPCO's Fiber Optic Network Company and KDDI. Under the agreement, the companies will combine their operating resources in order to develop a stronger telecommunications service group while providing an integrated telecommunications and electric power service that meets wide-ranging customer needs.

KDDI and TEPCO entered into a comprehensive agreement on Oct 13, 2005 to provide a telecommunications business offering a high level service for customers and to develop a strong strategy to compete against the NTT Group. The current agreement is based on an earlier agreement, on January 1 of this year, between KDDI and POWEREDCOM Inc..

1. Integration of TEPCO's Fiber Optic Network Company and KDDI
KDDI will acquire TEPCO's Fiber Optic Network Company on January 1, 2007. As part of the merger, KDDI will allocate 144,569 common shares to TEPCO. On the date of partition, a representative from TEPCO is scheduled to swear in as the executive committee, while staff of Fiber Optic Network Company is scheduled to be dispatched to KDDI to assist with the transition.

KDDI will absorb all contracts associated with Fiber Optic Network Company, including contracts with customers.

'TEPCO Hikari FTTH service' customers will continue to make use of current services through KDDI's ISP.

2. Establishing a Joint Venture to Construct, Maintain Fiber Optic Equipment and Facilities
KDDI and TEPCO are considering the feasibility of establishing a joint venture that would assume responsibility for the set up and maintenance of fiber optic cables by January 1, 2007.

With this integration, KDDI and TEPCO hope to develop a stronger telecommunications business group.

News Releases > 2006
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