Gakusei Engokai Merges with Intelligence to Solidify Leadership Position

Tokyo, Japan – Gakusei Engokai Co., Ltd., a leading publisher of job placement magazines in Japan, and Intelligence Ltd., a leading recruitment and consulting company, today announced a merger to solidify their industry leadership. The transaction is expected to close on July 1 this year.

Marrying the complementary strengths of Gakusei Engokai and Intelligence, the combined company will become a fully-integrated employment agency to offer part-time and temporary job seekers comprehensive placement services and intelligence. The merged company will benefit significantly from combining the established strong brand of Gakusei Engokai’s publishing capabilities and renowned recruitment services of Intelligence. The enlarged and integrated intelligence network will offer enormous value to advertisers, employers and job seekers.

The demand for placement services is growing and the market dynamic is changing with the increasing mobility of Japanese workers. Furthermore, a large number of vacancies will be created upon the imminent retirement of Japan’s first baby-boomer generation as early as 2007. The merger will allow the combined company to realize considerable synergies and capitalize on such growing demand as well as a changing market dynamic.

In September 2005, the management of Gakusei Engokai and The Carlyle Group, a global private equity firm, purchased the full ownership of the company from the founding family. Since the management buyout, Gakusei Engokai has been aggressively strengthening its business structure by integrating subsidiaries, speeding up decision-making, and reorganizing its product strategy with a goal to seek a public listing by the fall of 2007.

While considering possible merger and acquisitions as well as other options to realize further growth, Gakusei Engokai has also reviewed industry proposals on business alliances and equity partnerships. The management of Gakusei Engokai firmly believes the merger with Intelligence, with each bringing complementary strengths that create substantial synergies, will enable the company to become a leader in the job placement industry.

Recognizing the merger’s significant merits to Gakusei Engokai, The Carlyle Group has agreed to the management’s decision and will extend its full support in the implementation.

The Carlyle Group will remain as a significant minority shareholder of the merged entity and will continue to support its future growth.

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