Amsterdam, Tokyo, 07 March, 2002 - Marantz Japan Inc., its largest shareholder (49%), Royal Philips Electronics (AEX: PHI, NYSE:PHG), and DENON, Ltd., its largest shareholder (98%), Ripplewood Holdings L.L.C. today announced the establishment of D&M Holdings, Inc. a joint holding company to merge the operations of Marantz and DENON. The transaction is expected to close by May 2002 and will create a global leader in the premium home theatre and audio-video (AV) market, while maintaining the established Marantz and DENON brands. D&M Holdings will employ approximately 1,650 people around the world and will succeed Marantz as a publicly traded concern on the Second Section of the Tokyo Stock Exchange (TSE II: 6799). Both DENON and Marantz are leading branded manufacturers of premium home theatre and AV products. This market has enjoyed rapid growth in recent years, due to the emergence of home theatre applications as well as an industry wide digital evolution. D&M Holdings will be well positioned to benefit from this organic growth through the advanced development of cutting-edge digital products by matching DENON and Marantz’s expertise in digital AV and visual products as well as wireless technology. Moreover, Marantz and DENON expect to achieve a significant improvement in margins and cash flow by maximizing the synergies of the integrated operations. Commenting on the deal, Tatsuo Kabumoto, CEO of Marantz stated, “The combination of Denon and Marantz, backed by world class companies like Ripplewood Holdings and Philips, establishes a platform on which we intend to build the world class company in the premium audio visual space.” “Marantz regards the establishment of D&M Holdings as yet another important strategic step forward for the company following its acquisition of trademark rights and sales subsidiaries operating in Europe and the US from Philips last May,” he added. Mitsushige Sakamoto, CEO of DENON said, “leveraging the synergies of the merger and integrating DENON’s digital A/V technology with Marantz’s video and wireless technology, D&M Holdings will secure its position as a leading competitor in the home theatre market.”

The basic terms for the establishment of D&M Holdings are:  Marantz and DENON will set up D&M Holdings with its head office in Sagamihara City, Japan  Mr. Tatsuo Kabumoto, the current Chairman and Representative Director and CEO of Marantz, will become the President and CEO of D&M Holdings  All shares of both Marantz and DENON will be transferred to D&M Holdings, making both entities wholly-owned subsidiaries  Mr. Mitsushige Sakamoto, the current Representative Director of DENON, will become President and CEO of DENON while Mr. Takashi Sato, the current President and COO of Marantz will become President and CEO of Marantz.  Existing Marantz shareholders will receive one share of D&M Holdings for each Marantz share, and existing DENON shareholders will receive 0.4416 shares of D&M Holdings for each DENON share  Ownership of Marantz shareholders and DENON shareholders in D&M Holdings will be 30% and 70%, respectively  Philips and Ripplewood will have stakes of 14.7% and 68.6% in D&M Holdings, respectively  D&M Holdings will be listed on the Second Section of the Tokyo Stock Exchange

Following establishment of D&M Holdings, the research and development, production and purchasing, and financial control activities of the two companies will be combined as soon as possible, to reinforce their competitive edge and deliver the identified synergies. The DENON and Marantz brand names will be maintained, as well as their sales and marketing and brand specific product and unique distribution channel.

For further information, please contact:

Marantz Japan - Mr. Nishizawa, tel: +81-42-748-1110 35-1, 7-Chome, Sagamiono Sagamihara-shi Kanagawa, 228-8505 Japan Marantz Europe – Terrie O’Connell, tel: +31 40 250 7850 Marantz UK – John Hill, tel: +44 (0)1753 680868

DENON, Ltd. –Mr. Nakamura, tel: +81-3-3837-5221 3-16-11 Yushima Bunkyo-ku, Tokyo 113-0034 Japan

Ripplewood Japan - Mr. Sugimoto/Mr. Saito Tel: 03-5251-6580 15th Floor, Yamato Life Bldg, 1-1-7, Uchisaiwai-cho, Chiyoda-ku, Tokyo 100-0011

Philips Corporate Communications, Andre Manning, tel: +31 20 5977199 Email: Andre.manning@philips.com

About Marantz Japan, Inc. Marantz Japan, Inc. commenced operations in January 1953 and is listed on the Second Section of the Tokyo Stock Exchange. Its share capital is 1,135 million yen and its consolidated group companies have 628 employees (as of December 2001). For approximately half a century, Marantz has continued to hold unique technologies and to develop advanced technologies. Marantz’ products hold a strong market position, exemplified by its premium audio equipment designed for sophisticated audiophiles and by its high-end business-use equipment. In the area of R&D, new products are being developed through the fusion of audio, video and wireless technologies, reflecting adaptation to the digital age. About DENON, Ltd. DENON, Ltd., is a manufacturer of premium home theatre and AV equipment. The DENON brand is recognized globally for its unique and high quality sound technology. DENON has created a sophisticated, vertically integrated product offering including amplifiers, speakers and sound control and has established a remarkable reputation through it achievements in each of these areas. Its share capital is 550 million yen and on a consolidated basis, the company employs 1,019 individuals (as of December 2001). About Ripplewood Holdings L.L.C. Ripplewood Holdings L.L.C. is a New York-based private equity company and it operates in Japan through RHJ Industrial Partners L.P. It manages $4 billion of equity capital and has offices in New York and Tokyo with over 40 professionals. The company makes investment in promising firms, proactively participates in management, obtains capital gains by raising corporate values, thus bringing gains back to investors such as financial institutions and pension funds. In Japan, Ripplewood has been already in the process of revitalizing former Long Term Credit Bank of Japan (currently Shinsei Bank) and it intends to invest about $1.2 billion by 2004. About Royal Philips Electronics Royal Philips Electronics of the Netherlands is one of the world’s biggest electronics companies and Europe’s largest, with sales of EUR 32.3 billion in 2001. It is a global leader in color television sets, lighting, electric shavers, medical diagnostic imaging and patient monitoring, and one-chip TV products. Its 189,000 employees in more than 60 countries are active in the areas of lighting, consumer electronics, domestic appliances, components, semiconductors, and medical systems. Philips is quoted on the NYSE (symbol: PHG), London, Frankfurt, Amsterdam and other stock exchanges. News from Philips is located at www.news.philips.com