New investment in construction of a third plant to increase production of
Konica Minolta's polymerized toner

  In response to the increased demand for polymerized toner, Konica Minolta Business Technologies, Inc. (President: Yoshikatsu Ota) has resolved to make new investment in its production subsidiary, Konica Minolta Supplies Manufacturing Co., Ltd. (President: Yoshiaki Harada), to construct a third plant in order to enhance production capacity, especially for the company's next-generation polymerized toner.

  Construction of the third plant will start in September 2005, with completion scheduled for September 2006. The mass production of toner will commence in December 2006.

  With the addition of the new plant, which will have an annual production capacity of about 7,000 tons, Konica Minolta's annual production of polymerized toner will increase from 8,000 tons (combined production capacities of the first and second plants, as of November 2005) to about 15,000 tons, and Konica Minolta's position as a leading toner manufacturer in the industry will be further strengthened.

* Polymerized toner is truly a product for the next generation. It is characterized by fine, uniformly-sized particles produced using a different method than conventional pulverized toner. It is suitable for color digital equipment, as well as for black-and-white printing. Compared to conventional toner, polymerized toner provides a drastic improvement in image quality and cost reduction at the production level. In addition, this toner is very environmentally-friendly, with high energy-saving and emission-reducing effects.

Background

  Konica Minolta's strength in material and image processing technologies is backed by its long-accumulated optical and chemical synthesis technologies. This strength has earned Konica Minolta a competitive edge as a manufacturer of high-speed/color multi-function peripherals (MFP) and laser printers.

  In December 2000, Konica Minolta started production of "polymerized toner," a new product incorporating the company's state-of-the-art technologies, at the first plant in Kofu City.

  To meet increasing demand, Konica Minolta started construction of a second plant, also in Kofu City, in April 2002.The second plant was completed in May 2003, and additional investment was made in the plant to enhance its production capacity. The new production system of the second plant will be ready for operation in November 2005.

  Most of Konica Minolta's new MFPs and laser printers employ polymerized toner, and a further increase in the demand for the toner is anticipated due to the growing emphasis on color printing capability in the printer/MFP market. Accordingly, Konica Minolta has resolved to open the third plant to meet the urgent need to expand production capacity.

  Konica Minolta's polymerized toner is a high-end product manufactured using Konica-Minolta's proprietary method, and incorporates Konica Minolta Group's state-of-the-art four core technologies (imaging, optical, and material technologies, and nano-fabrication). Konica Minolta will continue to promote domestic development and production of the toner, while working to increase the strength of the Japanese "manufacturing industry" at large.

  In line with the overall enhancement of its chemical product business, Konica Minolta launched the color MFP "bizhub C450" in February 2005. Incorporating new integrated firmware, this new product is capable of producing brilliant, high-resolution images thanks to the suitable combination of polymerized toner and image- processing technology. The product also features various other customer-oriented functions and enjoys great success in the market.

  Konica Minolta will continue to promote innovation in product development in the fields of color MFP, high-speed MFP (POD) and color LBP, to which Konica Minolta Group's information equipment business—which is the major business for the Group—attaches the greatest importance. At the same time, Konica Minolta will further enhance its strengths in development and production of polymerized toner, the core of its chemical product business, and strive to achieve the leading position in the industry in the above fields.

New third plant(tentative name: Tatsuno Plant) investment plan

Selection of the construction site

  In selecting the construction site, we took various factors into consideration, including the convenience of water in-take and discharge; legal matters; construction schedule; and risk diversification. The site in Tatsunomachi, Kamiina-gun, Nagano Prefecture is rich in water resources and satisfies the necessary conditions for a suitable plant location. In addition, it is conveniently accessible to and from the first and second plants (Kofu City) and Hachioji City, where our R&D base is located, and therefore allows for the sharing of human and material resources needed for production of the next-generation polymerized toner, which requires highly advanced technologies. Also, this location enables us to diversify in terms of earthquake risk. These were the decisive factors for selection of this site.

Production system in the future

  The new third plant will be a production base for color polymerized toner for the fast-growing market for color printing capability, as well as for black polymerized toner. To be opened as a branch plant of Konica Minolta Supplies, the third plant will allow for the maximum sharing of technologies and maintenance and production control operations with the other two plants, which will result in personnel streamlining.

Characteristics of Konica Minolta's polymerized toner

  Konica Minolta employs a unique method to produce polymerized toner. Resin particles of 100 nanometers (1/10,000 of a millimeter) are synthesized through the emulsion polymerization method, and then chemically and finely coagulated and fused with a coloring agent.

Characteristically, this method allows for the production of small toner particles of uniform size and shape. These particles excel in colorant and wax dispersion and can produce high-quality images comparable to offset-printed images.

Also, polymerized toner is characterized by its environmentally-friendly qualities, as the emission of carbon dioxide, nitrogen oxide, and sulfur oxide during the production process is reduced by approximately 40% compared to the production of conventional pulverized toner.

Profile of Konica Minolta Supplies Manufacturing Co., Ltd.

Address	303 Miyabara-cho, Kofu, Yamanashi (in Kokubo Industrial Park)
Capital	1.5 billion yen
President	Yoshiaki Harada
No. of employees	about 230
Business outline	manufacture and sales of consumable supplies for electronic copiers and laser printers, including photoconductor drums and developers.