KKR L P : Announcement Regarding the Implementation of the Tender Offer for the Shares of Hitachi Koki Co., Ltd. (Securities Code 6581) and Amendments to the Press Release titled "Announcement Regarding the Tender Offer for the Shares of Hitachi Koki Co., Ltd. (Securities Code 6581)"

January 27, 2017

Company Name: HK Holdings Co., Ltd. Representative: William Janetschek Contact: 03-6268-6000

Announcement Regarding the Implementation of the Tender Offer for the Shares of Hitachi Koki Co., Ltd. (Securities Code 6581) and Amendments to the Press Release titled "Announcement Regarding the Tender Offer for the Shares of Hitachi Koki Co., Ltd. (Securities Code 6581)"

1. Implementation of the Tender Offer for the Shares of Hitachi Koki Co., Ltd.

   As announced in the press release issued on January 13, 2017 titled "Announcement Regarding the Tender Offer for the Shares of Hitachi Koki Co., Ltd. (Securities Code 6581)" (the "Press Release as of January 13, 2017"), HK Holdings Co., Ltd. (the "Offeror") intends to commence a tender offer on January 30, 2017 (the "Tender Offer") for the common shares and the share options issued based on the resolutions passed at the July 28, 2016 meeting of the Board of Directors of Hitachi Koki Co., Ltd. (Securities Code: 6581, First Section of the Tokyo Stock Exchange) (the "Target Company"), subject to the fulfillment of the Conditions Precedent to the Tender Offer (as defined on the page 1 of the Press Release as of January 13, 2017).

   As it has been confirmed that the Conditions Precedent to the Tender Offer have been fulfilled as of today, the Offeror hereby announces that the Offeror has decided to commence the Tender Offer on January 30, 2017, as planned.

   According to today's press release of the Target Company titled "Announcement Concerning Opinion Regarding the Implementation of the Tender Offer for the Shares of Hitachi Koki Co., Ltd. by HK Holdings Co., Ltd. and Amendments to the Press Release titled 'Announcement Concerning Opinion Regarding the Tender Offer for the Shares of Hitachi Koki Co., Ltd. by HK Holdings Co., Ltd.'", as of today the Target Company's Board of Directors has issued a resolution affirming that its opinion with regard to the Tender Offer has not changed, and that the Board of Directors of the Target Company supports the Tender Offer and leaves the decision of whether or not to tender into the Tender Offer once the Tender Offer has been commenced to the Target Company's shareholders and Share Option holders (for details regarding the opinion, see the press release issued by the Target Company on January 13, 2017 titled "Announcement of Opinion Regarding the Tender Offer for the Shares of Hitachi Koki Co., Ltd.by HK Holdings Co., Ltd.").

   For details regarding the Tender Offer, please see the Press Release as of January 13, 2017.

2. Amendment to the Press Release as of January 13, 2017

The Offeror hereby announces that it amends the contents of the Press Release as of January 13, 2017 as follows. Amended matters are underlined.

1. Purpose of the Tender Offer

(3) Measures to ensure the fairness of the Tender Offer Prices and avoid conflicts of interest, and other measures to ensure the fairness of the Tender Offer

Due to the fact that the Offeror has entered into the Tender Agreement with Hitachi, the parent of the Target Company, and Hitachi Urban Investment, Hitachi's subsidiary, the Offeror and the Target Company have implemented the following measures to ensure the fairness of the Tender Offer. Even though the Offeror has not set a minimum number of shares (the so-called "Majority of Minority") to be purchased, the Target Company believes that the interests of the Target Company's minority shareholders have been adequately considered, because the total amount of the Share Purchase Price and the Special Dividend (¥1,450 per Target Company Share) represents a discount of 4.10% on ¥1,512, the closing price of the Target Company Shares on the First Section of the Tokyo Stock Exchange on January 12, 2017, which was the business day immediately preceding the date of the announcement of the Tender Offer (today).

Additionally, as stated in " ② Discussions between the Offeror, the Target Company and Hitachi, and the

decision-making process of the Offeror" under "(2) Background, purpose, and decision-making process leading to the implementation of the Tender Offer, and management policy following the Tender Offer", the Offeror was selected from the bidding process conducted by the Target Company, and, regarding the Tender Offer the Offeror and Target Company have implemented the measures described in items (i) through (iv) below, which are based on explanations received from the Target Company.

1. Purpose of the Tender Offer

(3) Measures to ensure the fairness of the Tender Offer Prices and avoid conflicts of interest, and other measures to ensure the fairness of the Tender Offer

Due to the fact that the Offeror has entered into the Tender Agreement with Hitachi, the parent of the Target Company, and Hitachi Urban Investment, Hitachi's subsidiary, the Offeror and the Target Company have implemented the following measures to ensure the fairness of the Tender Offer. Even though the Offeror has not set a minimum number of shares (the so-called "Majority of Minority") to be purchased, the Target Company believes that the interests of the Target Company's minority shareholders have been adequately considered. Although the total amount of the Share Purchase Price and the Special Dividend (¥1,450 per Target Company Share) represents a discount of 4.10% on

¥1,512, the closing price of the Target Company Shares on the First Section of the Tokyo Stock Exchange on January 12, 2017, which was the business day immediately preceding the date of the announcement of the Tender Offer (today), (i) the Target Company believes that the total amount of the Share Purchase Price and the Special Dividend (¥1,450 per Target Company Share) is sufficiently valid and represents a premium on the listed share price (see below Note), because such total amount takes into consideration the effect of the media reports on October 5, 2016 and December 28,

2 0 1 6 regar d ing Hitac hi 's sal e o f its Target Co mp an y S h ar es, whic h in fl ue nced the li sted shar e p rice o f the Targe t Company Shares, as well as periods in which the impact of such reports was limited, (ii) as stated in "② Discussions

between the Offeror, the Target Company and Hitachi, and the decision-making process of the Offeror" under "(2) Background, purpose, and decision-making process leading to the implementation of the Tender Offer, and management policy following the Tender Offer", the Offeror was selected through a fair bidding process, including price competition, conducted by the Target Company, and, (iii) regarding the Tender Offer, the Offeror and Target Company have implemented the measures described in items (i) through (iv) below, which are based on explanations received from the Target Company.

(Note) The total amount of the Share Purchase Price and the Special Dividend (¥1,450 per Target Company Share) represents (x) a premium of 7.89% on ¥1,344, the one-month average closing price through January 12, 2017, the business day immediately preceding the date of the announcement of the Tender Offer (today); a premium of 35.26% on ¥1,072, the three-month average closing price through January 12, 2017; and a premium of 62.37% on ¥893, the six-month average closing price through January 12, 2017, and (y) a premium of 96.21% on ¥739, the closing price of the Target Company Shares on the First Section of the Tokyo Stock Exchange as of October 4, 2016, which was the

b usi ness d a y i m med iatel y p reced ing Oc to b er 5 , 2 01 6 , when med ia rep o rts regar d in g Hita chi 's sale o f its Target Company Shares were released; a premium of 100.00% on ¥725, the one-month average closing price through October 4, 2016; a premium of 108.93% on ¥694, the three-month average closing price through October 4, 2016; and a premium of 108.03% on ¥697, the six-month average closing price through October 4, 2016 and (z) a premium of 15.72% on ¥1,253, the closing price of the Target Company Shares on the First Section of the Tokyo Stock Exchange as of December 27, 2016, which was the business day immediately preceding December 28, 2016, when further media reports regar d ing Hitac hi 's s ale o f its Co mp a n y S har es were released; a premium of 27.08% on

¥1,141, the one-month average closing price through December 27, 2016; a premium of 50.41% on

¥964, the three-month average closing price through December 27, 2016; and a premium of 76.40% on ¥822, the six-month average closing price through December 27, 2016;

1. Purpose of the Tender Offer

(3) Measures to ensure the fairness of the Tender Offer Prices and avoid conflicts of interest, and other measures to ensure the fairness of the Tender Offer

③ The Target Company has established an independent committee to provide an opinion regarding the Transaction

On September 29, 2016, the Target Company established an independent committee for the purpose of eliminating arbitrariness in decision-making for the Transaction and ensuring the fairness, transparency, and objectivity

of the Target Company's decision-making process. The independent committee is comprised of three members who do not have any interest in the Target Company, Hitachi or the Offeror. The members of the independent committee are: Ms. Haruko Shibumura (outside director of the Target Company); Mr. Taisuke Senoo (outside director of the Target Company); and Mr. Noboru Yamamoto (outside director of the Target Company). The members of the independent committee have not changed since the establishment of the committee. On December 20, 2016, the Target Company requested that the independent committee advise the Target Company as to whether (i) the purpose of the Transaction is justifiable and reasonable; (ii) the fairness of the procedures for the Transaction has been ensured; (iii) the fairness and propriety of the terms of the Transaction (including the amounts of the Share Purchase Price and the Special Dividend) have been ensured; and (iv) regarding the Transaction, it is not disadvantageous to the minority shareholders of the Target Company (a) that its Board of Directors expresses an opinion to support the Tender Offer, recommends tendering shares therein, and issues the Special Dividend; and or (b) that, after completion of the Tender Offer, depending on the Offeror, the Company may approve the Demand for the Sale of Shares and carry out the Share Consolidation (the "Matters of Inquiry").

1. Purpose of the Tender Offer

(3) Measures to ensure the fairness of the Tender Offer Prices and avoid conflicts of interest, and other measures to ensure the fairness of the Tender Offer

③ The Target Company has established an independent committee to provide an opinion regarding the

Transaction

On September 29, 2016, the Target Company established an independent committee for the purpose of eliminating arbitrariness in decision-making for the Transaction and ensuring the fairness, transparency, and objectivity of the Target Company's decision-making process. The independent committee is comprised of three members who do not have any interest in the Target Company, Hitachi or the Offeror. The members of the independent committee are: Ms. Haruko Shibumura (outside director of the Target Company); Mr. Taisuke Senoo (outside director of the Target Company); and Mr. Noboru Yamamoto (outside director of the Target Company). The members of the independent committee have not changed since the establishment of the committee. On December 20, 2016, the Target Company requested that the independent committee advise the Target Company as to whether (i) the purpose of the Transaction is justifiable and reasonable; (ii) the fairness of the procedures for the Transaction has been ensured; (iii) the fairness and propriety of the terms of the Transaction (including the total amounts of the Share Purchase Price and the Special Dividend) have been ensured; and (iv) regarding the Transaction, it is not disadvantageous to the minority shareholders of the Target Company (a) that its Board of Directors expresses an opinion to support the Tender Offer, recommends tendering shares therein, and issues the Special Dividend; and or (b) that, after completion of the Tender Offer, depending on the Offeror, the Company may approve the Demand for the Sale of Shares (as defined in "( 5) Policy for