September 3, 2004

On June 14, 2004, Kanematsu Corp. conducted its 2nd issue of unsecured non-detachable warrants, valued at \10 billion. Progress in the conversion of these warrants to equity shares of the Company is as follows, as of August 31, 2004.

Conversion to Equity Shares (as of August 31, 2004)

1. Name of convertible bond:
Kanematsu Corp.'s 2nd issue of unsecured non-detachable warrants
(Non-detachable warrants with a special clause for non-subordination to other bonds traded solely in Japan)

2. Cumulative conversion amount: \5,600 million
(Conversion rate: 56%, Remainder: \4,400 million)

3. Category of equity shares: Ordinary shares

4. Total number of shares issued: 36,941,750