LAWSON Agrees to Business Alliance With MatsumotoKiyoshi Holdings

MatsumotoKiyoshi Holdings, based on the corporate philosophy of "1st for you," operates urban and suburban drugstores, pharmacies, and combination drugstore/pharmacies nationwide in a variety of store formats according to regional characteristics and location. These stores, which constantly take the customer's standpoint, take a specialized approach to meeting the needs of customers who seek to be healthy and beautiful through a product lineup centered around health and beauty and by providing value primarily through counseling services.

The two companies have mutual respect for each other's corporate philosophy and business policies, and have concluded the basic alliance agreement with the intent of leveraging the two groups' respective management resources-including specialized knowledge, resources, buying power, and infrastructure-to create a new type of store and provide their customers with high-value-added, highly specialized merchandise and services. Based on the business theme that "food is medicine," the stores will help customers to achieve the healthy and comfortable lifestyles they seek as the aging of society continues to accelerate.

Concrete details of the alliance will be finalized going forward.

2.Details of Alliance to Be Discussed Going Forward
(1) Utilization of Human Resources
-1-Personnel exchange
By dispatching employees to each other's operations, LAWSON will acquire know-how in pharmaceutical sales, develop registered pharmaceuticals salespersons and expand stores selling pharmaceuticals. For its part, MatsumotoKiyoshi Holdings will both gain knowledge about convenience store operations and supply the merchandise necessary for a drugstore and the drugstore sales expertise.

(2) Product Description
-1-Joint development of private brand merchandise
Focusing on the three categories of non-prescription pharmaceuticals (merchandise to be sold at the new-format stores), cosmetics, and daily necessities, all of which offer advantageous possibilities to both companies, LAWSON and MatsumotoKiyoshi Holdings will develop specialized merchandise with high price flexibility and merchandise with high added value and high quality for sales at both companies' stores.

-2-Leveraging national brand merchandise and each company's existing private brands
The two companies aim to achieve maximum cost advantages in merchandise procurement by supplementing the national brand merchandise sold by both companies as well as each company's existing private brands and jointly utilizing logistics systems.

(3) Description of Proposed New Store Format
-1-Development of new store format
Pooling their expertise in the drugstore and convenience store businesses, the two companies will develop stores in a new format that provides over-the-counter drugs and counseling services.

-2-Establishment of a joint venture for the operation of new-format stores
The two companies will form a joint venture to develop multiple stores at an early date.

(4)Other Initiatives
-1-Joint utilization of IT
The companies will consider joint utilization of IT, including Loppi multimedia terminals for online commercial transactions and ATMs.

-2-Exchange of information regarding store development in existing businesses

-3-Mutual supply of fixtures, etc.
The two corporate groups will aim to reduce costs by supplying each other with store fixtures.

-4-Addressing environmental issues
The two companies will work together to establish environment-conscious stores and store operations.

3.Overview of the Two Companies

(1) Name	LAWSON, INC.	MatsumotoKiyoshi Holdings Co., Ltd.
(2) Business activities	Operation of franchised chain of LAWSON convenience stores	Management and supervision of drugstore and other subsidiaries and purchasing and sales of products
(3) Date established	15-Apr-75	1-Oct-07
(4) Headquarters address	11-2, Osaki 1-chome, Shinagawa-ku, Tokyo, Japan	9-1, Shinmatsudo-higashi, Matsudo-shi, Chiba, Japan
(5) Representatives	Takeshi Niinami President & CEO	Namio Matsumoto Representative Director, Chairman and CEO Masashi Yoshida Representative Director, President and COO
(6) Capital	58,506 million yen	21,086 million yen
(7) Number of shares issued	99,600,000 shares	53,579,014 shares
(8) Net assets	203,178 million yen   (consolidated)	96,761 million yen   (consolidated)
(9) Total assets	436,171 million yen   (consolidated)	195,884 million yen   (consolidated)
(10) Net sales	1,558,781 million yen   (consolidated)	392,268 million yen   (consolidated)
	(As of February 28, 2009)	(As of March 31, 2009)

4.Outlook
The two companies plan to proceed with discussions toward a final agreement on concrete details of the alliance. Any impact on business results will be announced as necessary once specific measures have been decided.