EXHIBIT 99.1
Intersil Completes Supply Agreement Transaction
IRVINE, CA - June 30, 2000 - Intersil (NASDAQ: ISIL) announced today it has
completed a multi-year supply agreement with ChipPAC, Inc. of Santa Clara,
California for integrated circuit (IC) assembly and test services. Under terms
of the agreement, Intersil has sold its Kuala Lumpur, Malaysia-based
semiconductor assembly and test operations to ChipPAC, which will supply
services to Intersil on a subcontract basis. "This agreement plays to the
strengths of both companies," says Greg Williams, President and CEO of Intersil.
"We can devote our energy to the design, development and marketing of high value
ICs and chip sets for the integrated communications market while ChipPAC can
expand its global operations by investing in a world-class assembly and test
facility. This agreement gives Intersil additional test and assembly capacity,
access to new packaging technologies and cost reduction benefits that support
our goal of improving our overall gross margins. More importantly, we've gained
a valued, long-term partner who will work closely with us to ensure a seamless
transition for our customers." Under terms of the agreement, ChipPAC acquires
all of Intersil's Kuala Lumpur manufacturing assets, including a 524,000 square
foot semiconductor assembly and test facility, wireless and analog/mixed-signal
test capabilities, a product distribution center as well as the operation's
management team and approximately 2,900 employees. As a result of the
transaction, Intersil receives cash and other consideration for its Kuala Lumpur
operations, and recognizes a non-recurring, after-tax charge of between $10
million and $15 million in the fourth quarter ending today. Intersil has also
completed a five-year supply agreement with ChipPAC that provides Intersil
additional assembly and test capacity, access to new packaging technologies and
improved operating performance.
About Intersil
Intersil uses its semiconductor expertise to enable highly integrated voice,
data and video communications. Intersil's integrated communications portfolio
includes PRISM(R) Wireless Local Area Network (WLAN) chip sets that enable
mobile connectivity products for the home and office; analog, mixed-signal and
digital integrated circuits for broadband access to wireless and wired Wide Area
Networks (WANs); and power management products that enable 24x7 reliability in
network servers, next generation PCs and information appliances. For more
information about Intersil, visit the company's Internet homepage at
www.intersil.com.
About ChipPAC, Inc.
ChipPAC, Inc. is one of the world's largest providers of semiconductor packaging
and test services. The company offers a full array of packaging, from basic
6-pin to 2000-pin BGA/CSP and leaded packages. These packages are offered in
wire-bond and flip-chip processes. The company has approximately 6,900 employees
worldwide, with sales offices in Boston, Dallas, Phoenix, San Diego, Santa
Clara, Japan, Korea, Singapore and The Netherlands, and ISO 9002-certified
manufacturing facilities located in Ichon, Korea, Shanghai, China, and Kuala
Lumpur, Malaysia. ChipPAC headquarters are 3151 Coronado Dr., Santa Clara,
California 95054, 408-486-5900 or 1-888-232-2003, e-mail: [email protected].
ChipPAC Inc. is first in Shaping Solutions*. Visit www.chippac.com for complete
information about ChipPAC, including our new on-line Customer Center for
product-specific information.
This press release contains information relating to prospective cost reductions
and improved gross margins that are forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to certain risks, uncertainties and assumptions that are
difficult to predict. Therefore, our actual results could differ materially and
adversely from those expressed in the forward looking statements as a result of
various risk factors. Important risk factors that may cause such material
differences for Intersil in connection with achieving cost reductions and
improved gross margins include, but are not limited to, potential problems
arising from the transition from a dedicated in-house assembly and test
operation to an outsourcing supply arrangement; silicon wafer pricing and the
availability of foundry and assembly capacity and raw materials; intellectual
property disputes; as well as
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other risk factors detailed from time to time in Intersil's filings with the
U.S. Securities & Exchange Commission. These forward-looking statements are made
only as of the date of this press release and Intersil undertakes no obligation
to update or revise these forward-looking statements.
PRISM is a registered trademark of Intersil Corporation.
Shaping Solutions is a trademark of ChipPAC, Inc.
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