News Room 2005 (The former Furukawa-Sky)

Notice Regarding Our Board Meeting to Decide Upon a New Share Issuance

October 26, 2005

We provide details below regarding the decision reached in our board of directors meeting held on October 26, 2005 to issue of new common shares of our Company along with our listing on the Tokyo Stock Exchange.

1. Terms of our public offering of new shares

(10)The amount of the issue value to be excluded from our capital and other terms and conditions of the issue will be determined in a board meeting.
(1)New shares issued	22,100,000 common shares
(2)Issue price	To be determined in a board meeting
(3)Issue price	To be determined (after determining the issue price, we will establish provisional pricing above the issue price and determine the demand conditions through a survey of investors on November 21, 2005)
(4)Subscription method	Public offering at the issue price
(5)Transaction method	Nomura Securities, Mizuho Securities, Nikko Cordial Group, Daiwa Securities SMBC, Mitsubishi UJF Securities, Goldman Sacs Group, Merrill Lynch Japan Securities, Shinko Securities, and Monex Beans Securities comprise the underwriting syndicate group. The issue and subscription prices will be determined at the same time, and in the event that the subscription price falls below the issue price, the issue will be cancelled.
(6)Subscription unit	1,000 shares
(7)Subscription period	November 24 (Thursday) to November 29 (Tuesday) , 2005
(8)Payment date	December 1, 2005 (Thursday)
(9)Dividend reckoning date	October 1, 2005 (Saturday)
(11)With regards to the above mentioned items, we will issue a prospectus in accordance with the securities exchange laws.

2. Terms of our share sales

(9)With regards to the above mentioned items, we will issue a prospectus in accordance with the securities exchange laws. And in the event that the public offering will be cancelled in accordance with the terms mentioned in section 1, the share sales will also be cancelled.
(1)Total shares to be sold	27,100,000 common shares
(2)Pricing	Yet to be determined (Pricing will be the same as the mentioned above in section 1)
(3)Sales method	Sales to the general public
(4)Subscription period	Same as mentioned above in section 1
(5)Subscription unit	Same as mentioned above in section 1
(6)Transaction method	Nomura Securities will be the underwriter, purchasing all of the shares
(7)Share delivery date	December 2, 2005 (Friday)
(8)Others	Aside from the terms of the sale mentioned above, Nomura Securities will act as the underwriter and could implement a maximum limit of 5,000,000 shares in the sale (to be called "over-allotment"). In this instance, terms mentioned above 2 to 5 and 7 will be the same.

3. Terms of our third party placement

(8)The share sales will be concluded for shares for which there is no application as of the payment date.
(1)Shares issued	5,000,000 common shares
(2)Issue price	Yet to be determined (Pricing will be the same as the mentioned above in section 1)
(3)Allotment price	Yet to be determined (Pricing will be the same as the mentioned above in section 1)
(4)Allotment method	The shares will be sold to Nomura Securities at the allotment price. In the event that the allotment price falls below the issue price, we may cancel the share issuance.
(5)Allotment units	1,000 shares
(6)Payment date	January 4, 2006 (Wedenesday)
(7)Dividend reckoning date	October 1, 2005 (Saturday)
(9)Aside from the terms mentioned above, the amount of the issue value to be excluded from our capital and other terms and conditions of the issue will be determined in a board meeting.
(10)As mentioned in section 2.8 above, if the over-allotment is cancelled, then the third party placement will also be cancelled.

(Reference)

1. Terms of our subscription, sales

(1)Number of new shares to be issued and shares to be sold

(a)New shares issued	Common shares	22,100,000
(b)Shares sold	Common shares	Shares to be sold by the underwriter: 27,100,000 Shares sold as part of the over-allotment: (*) 5,000,000

(2)Indication for shares

November 14, 2005 (Monday) to November 18, 2005 (Friday)

(3)Pricing date

November 21, 2005 (Monday) (Issue and sale price will be determined after a survey of the demand by investors at the provisional pricing.)

(4)Subscription, sale period

November 24, 2005 (Thursday) to November 29, 2005 (Tuesday)

(5)Payment date

December 1, 2005 (Thursday)

(6)Dividend reckoning date

October 1, 2005 (Saturday)

(7)Share delivery date

December 2, 2005 (Friday)

(*) The over-allotment sales of shares mentioned above will be determined by the underwriter after considering the demand conditions for the issue and will be set at a maximum of 5,000,000 shares. Nomura Securities will take shares on loan from our shareholder Furukawa Electric Co., Ltd. for the over-allotment. Therefore the over-allotment shares maybe reduced from the limit of 5,000,000 depending upon demand for the issue. Moreover, in relation to this issue we decided in our board meeting held on October 26, 2005 to conduct a third party placement of 5,000,000 common shares through the underwriter Nomura Securities to be paid for on January 4, 2006. The purpose of this third party placement is to allow Nomura Securities to return the shares to be sold in the over-allotment between December 2 to 26, 2005 to our shareholder Furukawa Electric. In the event that members of the syndicate do not fulfill their quota during the subscription and share sales, Nomura Securities may elect to refuse their participation in the third party placement issue, and the loss of shares to be purchased by syndicate members could lead to a reduction in the total number of shares to be issued during the third party placement. Furthermore in the event that syndicate members do not participate at all in the issue or the demand for the issue falls well below the upper limit of shares, then Nomura Securities has the right to conclude the issue well short of the maximum number of shares.

2. Change in number of shares outstanding resulting from the new share issuance

Current total shares outstanding	200,000,000
New shares to be issued	22,100,000
Third party placement shares to be issued	(maximum) 5,000,000
Total shares outstanding after issue	(maximum) 227,100,000

3. Uses of funds from the share issue

All of the ¥10,316 million in funds raised (^*1) during the share issue is expected to be used for capital investments. Within our capital investment plans we expect to spend money to maintain, renew and rationalize facilities at our Fukui and Fukaya Plants.

*1: This figure is based on projected price of ¥500 per share used in our prospectus.

4. Distribution of profits to shareholders

(1)Our basic policy of profit distribution

We have a policy maintaining a stable level of dividends, but also recognize the need to be able to adjust the level of dividends to allow us to make investments for new business activities and out of consideration for the level of our profits overall.

(2)Uses of retained profits

We will use retained profits to fortify our business foundation and to prepare for future investments.

(3)Our concrete plans to expand profit distribution to our shareholders

Our Company seeks to strike a balance between the maintenance of a stable level of dividends as its basic policy, while also maintaining an adequate level of profit retention to fortify our business foundation and to prepare for future investments.

(4)Recent financial trends

	March 2003	March 2004	March 2005
EPS	12.97	54.37	74.85
Dividend per share (interim dividend per share)	- (-)	15.69 (-)	37.42 (15.00)
Dividend payout ratio	-	28.9%	50.0%
ROE	2.64%	13.28%	16.69%
Dividend to equity ratio	-	3.7%	7.9%

Note:

We base our EPS estimates on the average number of shares outstanding during the term.
ROE is based on the average of shareholder equity at the start of the term and the end of the term. Dividend to equity ratio is based on total dividend payments divided by shareholder's equity.
On August 12, 2005 we performed a 2 for 1 stock split.

	Term 40	Term 1	Term 2
	March 2003	March 2004	March 2005
EPS	6.49	27.19	37.42
Dividend per share (Interim dividend per share)	- (-)	7.85 (-)	18.71 (7.50)

5. Our basic distribution policy

With regards to the sale of our shares, we are in compliance with the regulations for listed companies as defined by the Tokyo Stock Exchange, and out of a consideration of liquidity of our shares after our listing, we may sell shares to investors who did not give an indication of purchase during the issue. With regards to investors who did indicate their intention to purchase our shares in the issue, the underwriter will use its experience and know-how to determine the amount of shares to be sold to those investors. With regards to sales of shares to investors who did not indicate their intention to purchase, the underwriter will also use its experience and know-how to determine the amount of shares to be sold to those investors

6. Others

In the public offering of new shares, we expect to set aside some shares to be sold from the 22,100,000 shares to our employees.

Note:: With regards to section 4, distribution of profits to shareholders, this section does not reflect a promise to pay dividends but is an indication of our basic philosophy and desire to return profits to our shareholders.