Mitsui & Co., Ltd. has signed an agreement with International Power Plc. (IPR) on March 29, 2007 (London time), to combine the ownership of three UK power generating assets solely owned by IPR, and two UK generating assets jointly owned through a partnership between Mitsui and IPR, IPM Eagle LLP (IPM). The transaction, which is expected to close in June 2007, will involve the payment of approximately 85 million Pounds (approx. 20 bil yen) to IPR, resulting in Mitsui's increase of 258 MW in generating capacity.

Mitsui and IPR will jointly establish a new company ("the Company" -Mitsui 25%, IPR75%), who will own the three UK power generating assets, together with the fuel purchase and power sales companies, which were previously owned by IPR. Also, the two UK generating assets owned by IPM will be combined with the Company, where 5% stake of the assets will be transferred from Mitsui to IPR. The contract includes the partial transfer to IPR of the economic interest obtained from the operation of Paiton coal fired power plant in Indonesia. This transaction results in reallocation of rights between Mitsui and IPR to receive revenues from Paiton IPM interest, but does not entail any transfer of shares or any change of management structure.

Previously, IPM and IPR owned generation assets individually, but with this transaction, we expect to enhance the efficiency and optimize the management of the combined assets. The Company will become a major power generator in the UK power market with approximately 5,000 MW of capacity, diversified into multi fuel sources and power units, with the capability to provide flexibility and variety in the operation and management. Through this arrangement, Mitsui intends to strengthen its relation with IPR, and will endeavor to increase the value of the acquired assets.