1. Purpose of merger

With the Japanese telecommunications market growing increasingly competitive and globalized as a result of deregulation and technological developments, DDI, KDD and IDO have been vigorously negotiating to build a secure position for themselves as a core telecommunications provider, and as a result have reached agreement as equals on the following basic points:

1. Becoming a comprehensive telecommunications carrier capable of offering seamless mobile, domestic and international telecom services will realize synergies enabling DDI, KDD and IDO to provide services more effectively and efficiently and thereby compete more effectively against the NTT group.
2. By enhancing their capital base, DDI, KDD and IDO will be able to accelerate moves to expand the scope of their businesses.
3. Through improving operating efficiency and competitiveness and expanding their scope of business, DDI, KDD and IDO will be able to offer world-beating services and aggressively expand marketing operations to capture the support of a wide customer base ranging from individuals to mega-companies both in Japan and abroad.
4. By concentrating management resources on one merged company and harmonizing the business objectives of personnel at all three firms in line with a unified business strategy, DDI, KDD and IDO aim to become a powerful business entity with the strength to compete against the dominant carriers in Japan and overseas.

In addition to becoming increasingly cutthroat, the market is also seeing a rapid shift from voice to data communications, and from fixed to mobile communications. Being able to offer seamless service by developing both mobile and IP networks has thus grown to be of vital importance. Merging will enable DDI, KDD and IDO to respond to this changing environment, allowing them to pool their accumulated know-how, develop and expand an integrated backbone and provide a seamless nationwide mobile phone service, and become a leading player in developing next-generation mobile communications services.

Focusing as it will on mobile and IP network services and making more effective use of management resources, the global comprehensive telecommunications provider that the merger will create will greatly benefit the Japanese public and make a genuine contribution to the development of the economy as a whole.

2. Outline of merger

　(1) Planned merger timetable

Signing of merger memorandum:		December 16, 1999
Board meeting to approve merger agreement:		Late March 2000
Signing of merger agreement:		April 1, 2000
General meeting of shareholders to approve merger agreement:		Late June 2000
Date of merger:		October 1, 2000
Registration of merger:		Early October 2000

　(2) Surviving company

DDI CORPORATION

(3) Merger share ratios

Company	DDI (Par value per share: 5,000 yen)	KDD (Par value per share: 500 yen)
Merger ratio	9.21	1

Company	DDI (Par value per share: 5,000 yen)	IDO (Par value per share: 50,000 yen)
Merger ratio	29	1

Note: Par value of shares in each company converted to same value.

1. Proportional allocation of shares
   One share in DDI (par value per share: 5,000 yen) will be issued per [92.1] shares in KDD (par value per share: 500 yen). One share in DDI (par value per share: 5,000 yen) will be issued per 2.9 shares in IDO (par value per share: 50,000 yen).

2. Reasons for merger ratios
   The merger ratio for DDI and KDD was calculated based on the average closing price on the TSE over the six months up to December 15, 1999 of shares issued by each company. The ratio in the case of IDO was determined based on the results of calculations by a third-party agency, and finalized by agreement among the parties to the merger.

3. Number of new shares issued through merger
   Par value ordinary shares: 1,345,260.60 (par value per share: 5,000 yen)
   (Calculated on the basis of the capital stock of KDD and IDO as of December 15, 1999.)

Pending

3. Outline of parties to the merger

(1)	Trade name	DDI CORPORATION	KDD Corporation	IDO CORPORATION
(2)	Line of business	Type I carrier	Type I carrier	Type I carrier
(3)	Incorporation	June 1, 1984	March 24, 1953	March 9, 1987
(4)	Principal office	8, Ichiban-cho, Chiyoda-ku, Tokyo	2-3-2, Nishi-shinjuku, Shinjuku-ku, Tokyo	6, Rokuban-cho, Chiyoda-ku, Tokyo
(5)	Representative	Yusai Okuyama	Tadashi Nishimoto	Satoshi Nakagawa
(6)	Capital	72,634 million yen	40,502 million yen	68,740 million yen
(7)	Capital stock (par value)	2,274,442 shares (5,000 yen)	76,224,823 shares (500 yen)	1,374,804 shares (50,000 yen)
(8)	Shareholders' equity	318,281 million yen	371,258 million yen	19,865 million yen
(9)	Total assets	810,895 million yen	924,733 million yen	457,995 million yen
(10)	Accounting period	March 31	March 31	March 31
(11)	Employees	2,990	5,792	979
(12)	Main shareholders and shareholdings	Kyocera Corp. 25.16% The Sumitomo Trust & Banking Co., Ltd. 4.44% IBJ Trust and Banking Co., Ltd.* 4.16% The Chase Manhattan Bank, N.A., London 3.33%	Ministry of Posts &Telecommunications Mutual Aid Association 9.26% Toyota Motor Corp. 8.42% Nippon Telegraph and Telephone Corp. 8.42% Nippon Life Insurance Co. 4.86%	Toyota Motor Corp. 62.84% Tokyo Electric Power Co., Ltd. 11.78% Chubu Electric Power Co., Ltd. 7.57% KDD Corp. 2.40%

Note: Data correct as of March 31, 1999.
* IBJ Trust and Banking's stake is the trust property of Sony Corp.

Financial results over past three years

	DDI (surviving company)			KDD (merged company)			IDO (merged company)
Accounting period	Year ending Mar. 1997	Year ending Mar. 1998	Year ending Mar. 1999	Year ending Mar. 1997	Year ending Mar. 1998	Year ending Mar. 1999	Year ending Mar. 1997	Year ending Mar. 1998	Year ending Mar. 1999
Sales (mil. yen)	557,839	535,882	605,510	322,458	316,413	313,160	267,440	338,825	410,710
Ordinary profit (mil. yen)	67,756	39,503	33,648	20,807	16,761	9,425	-5,889	-38,553	26,938
Net income (mil. yen)	37,783	23,740	16,867	10,165	8,451	7,269	-5,919	-38,583	7,509
Net income per share (yen)	17,376.07	10,876.41	7,416.01	158.16	131.50	106.50	-12,918.15	-81,949.68	5,461.93
Dividend per share (yen)	1,790.00	1,790.00	1,790.00	50.00	50.00	50.00	-	-	-
Shareholders' equity per share (yen)	113,939.39	134,341.24	139,938.22	5,493.98	5,573.70	4,870.57	11,158.14	8,987.77	14,449.70

4. Status after merger

(1)	Trade name:	DDI CORPORATION
(2)	Logomark:	KDDI
(3)	Line of business:	Type I carrier
(4)	Principal office:	8 Ichiban-cho, Chiyoda-ku, Tokyo
(5)	Representative:	Yusai Okuyama (President)
(6)	Capital:	Pending
(7)	Total assets	2.1936 trillion yen (combined total assets of each company as of March 31, 1999)
(8)	Accounting period	March 31
(9)	Projected non-consolidated business results after merger (first two years) Year ending March 2001 Year ending March 2002 Sales 1,160bn yen 1,750bn yen Operating profit 50bn yen 100bn yen Ordinary profit 40bn yen 90bn yen Net income 30bn yen 60bn yen 1) Projected post-merger non-consolidated results obtained by simply adding up figures for each company. 2) Projected post-merger non-consolidated results for the year ending March 2001 do not include first-half projections for KDD and IDO.
(10)	Post-merger consolidated sales projections (first two years) Year ending March 2001 Year ending March 2002 Sales 2,690bn yen 3,550bn yen 3) Post-merger consolidated sales figures obtained by simply combining projections for each company. 4) Post-merger consolidated sales projections for the year ending March 2001 do not include first-half sales KDD and IDO. Their inclusion would increase sales to 3,260bn yen.

5. Allocation of new shares to third party

DDI shall allocate to and Toyota Motor Corp. shall receive new shares prior to the merger. Specific details of the third-party share allocation shall be determined at a later date by separate agreement.