Kawasaki to Acquire IHI’s Cement Plant Business

Tokyo, February 25, 2008 — Kawasaki Plant Systems, Ltd. (K Plant) announced today that it has reached a basic agreement with IHI Corporation to fully acquire IHI’s cement plant business as of April 1, 2008. The two companies will conclude the formal Business Transfer Contract in late March.

The business includes design, manufacture, installation, test-run, repair, modification, expansion, after-sales services, supplies and other work for cement plants and such major components as preheaters, kilns, and mills – virtually all areas related to the cement plant business.

K plant will become a world-class cement plant producer through the acquisition. Based on the technologies and experience accumulated by the two companies, K Plant plans to further expand the business in the domestic and overseas markets. The Company expects that this deal will strengthen its management foundation in the medium to long term.

IHI will transfer its cement plant business and accelerate the process of achieving greater selectivity and focus in its operations by shifting corporate resources to other fields. Although IHI will withdraw from the cement plant business, it will continue to be responsible for all the orders it has already received in this field.