Matsushita Electric Announces Intention to Purchase Own Shares / Part of package aimed at better sharing interests with shareholders

OSAKA, Japan (ots-PRNewswire) - Matsushita Electric Industrial
Co., Ltd. (NYSE: MC; PCX: MC) today announced that its board of directors has made a preliminary decision to implement a package of management initiatives aimed at better serving shareholder interests.

The package includes: (1) the use of retained earnings to purchase common stock for retirement; (2) a stock option plan for board members and senior executives and a stock-price-linked remuneration plan for employees of manager-level or above; and (3) steps to improve corporate governance, including the establishment of a Matsushita Group Management Committee and an outside Advisory Board.

In announcing these plans, management said that Matsushita Electric intends to place increasing emphasis on shareholder interests, management transparency, and management resource efficiency, in light of the Company's expanding global operations and a changing corporate environment.

Management added, "Since the Company's founding, Matsushita Electric has remained committed to its guiding principle:
contribution to society through business activities, mindful of management transparency. In the spirit of this commitment, the Company is now implementing a series of management initiatives to further enhance corporate value by placing an emphasis on serving the interests of shareholders. We aim to implement a new management style that readies us for the twenty-first century, thereby meeting the needs of international society."

Tentatively set management plans are outlined as follows:
1. Purchase of shares for retirement under Article 212-2 of
the Japanese Commercial Code

Management intends to spend a maximum 100 billion yen of retained earnings for this operation, which would become effective for one year following the annual shareholders' meeting to be held in late June 1998. Implementation of
the plan is subject to further study and resolution of
details at future board meetings and approval at the
annual shareholders' meeting.

2. Stock option and stock-price-linked remuneration plans
The plans outlined below are intended to better focus the attention of directors, senior executives and managers on
the interests of shareholders.

(1) Purchase of shares to provide stock options for board members and senior executives of the Company under Article 210-2 of the Japanese Commercial Code
Also subject to resolution of further details at future
board meetings and shareholder approval, the Company's
first stock option rights will be allotted to board
members and select senior executives who are in
office as at the closing of the aforementioned annual shareholders' meeting, at amounts ranging from 2,000 to
10,000 shares of common stock per qualified individual.
Share purchases for this purpose will be limited in
aggregate to either 150,000 common shares or 400 million
yen in value, whichever is reached first. The stock
option rights would be exercisable during the four-year
period beginning July 1, 2000.

(2) Introduction of a stock-price-linked remuneration
plan for employees of manager-level or above
This incentive will be offered in cash as part of
remuneration once a year to some 11,000 employees of manager-level or above, to the extent to which the annual average market price of the Company's common stock exceeds that of the preceding fiscal year. The plan would be implemented from April 1998 through March 2001.

3. Plans to improve corporate governance
The plans, as outlined below, are intended to enhance the transparency and objectiveness of management conduct,
address the needs of international society, and thereby improve corporate governance.

(1) Establishment of a Matsushita Group Management
Committee Organized by selected key executives of the Matsushita head office and of various divisions, the
committee will discuss group and global strategy and set
the course of the group's key issues to speed decision-
making by the board of directors.

(2) Establishment of an outside Advisory Board
Management plans to establish an Advisory Board consisting
of select, distinguished individuals from outside the
Company. These outside advisors would be expected to
provide third-party opinions and suggestions from broad
and international viewpoints so that management can
reflect such advice on the Company's operations.

Matsushita Electric Industrial Co., Ltd. is one of the world's leading producers of electronic and electric products for consumer, business and industrial use, which it markets around the world under the "Panasonic," "National," "Technics" and "Quasar" brand names. Matsushita's shares are listed outside Japan on the Amsterdam, Dusseldorf, Frankfurt, New York, Pacific and Paris stock exchanges.

ots Original Text Service: Matsushita Electric Industrial Co., Ltd. Internet:

CONTACT: Akihiro Takei of Panasonic Finance (America), 212-371-5447/

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