January 25, 2006

  Konica Minolta Business Technologies, Inc. (President: Yoshikatsu Ota) newly established a wholly-owned office equipment sales subsidiary in the People's Republic of China as outlined below.

Background and purpose of the establishment of a new subsidiary

  Because of the legal restrictions imposed by the Chinese government, we have been selling our products in mainland China through two channels, namely, Konica Minolta Business Solutions (WUHAN) Co., Ltd.,*¹ a joint venture with a Chinese company, and Konica Minolta International Trading (SHANGHAI) Co., Ltd., *² an import and sales company headquartered in the bonded zone in Shanghai City.

  Following the agreement reached upon China's accession to WTO, however, approximately two years ago an accelerated process to ease the restrictions on commercial distribution in China was put into place, and now foreign companies are allowed to operate wholly-owned sales subsidiaries locally. Seizing this opportunity, we established a wholly-owned sales subsidiary in this rapidly growing market, integrating the sales operations of the two companies mentioned above, with a view to exerting centralized control over both our direct sales and distributors' resales channels while responding to market needs more quickly and flexibly.

  Konica Minolta will remain committed to developing innovative, quality products in the fields of color MFPs*, high-speed MFPs* (POD), and color laser printers. These products are the focus of Konica Minolta Group's office equipment business, currently earmarked as the group's most important business. Konica Minolta will continue efforts to create a strong sales network throughout China, so that we will be able to establish our presence as a leader in all of these focused fields.

*MFP (multi function peripheral): A multi-functional computer peripheral, which can be used not only as a copier, but also as a fax machine, printer, and so on.

Outline of the new subsidiary

1. Name
   (Chinese)
   (English) Konica Minolta Business Solutions (CHINA) Co., Ltd.
2. Representative: Tadayuki Funakura, Chairman and President
3. Location: Shanghai City, People's Republic of China
4. Establishment: November 2005
5. Registered capital: US$12 million
6. Shareholder: 100% owned by Konica Minolta Business Technologies, Inc.
7. Business activities: import, sales, and after-sales service of MFPs, laser printers, and other office equipment, as well as related consumable supplies and component parts in China

*1 Konica Minolta Business Solutions (WUHAN) Co., Ltd.

Representative: Tadayuki Funakura, Chairman
Location: Wuhan City, Hubei Province, PRC
Establishment: October 1994
Capital: US$7 million
Business activities: manufacture, sales, and after-sales service of MFPs and other office equipment

*2 Konica Minolta International Trading (SHANGHAI) Co., Ltd.

Representative: Tadayuki Funakura, Chairman
Location: Waigaoqiao Bonded Zone, Shanghai City, PRC
Establishment: July 1996
Capital: US$1.6 million
Business activities: import, sales, and after-sales service of MFPs and other office equipment as well as related consumable supplies and component parts