RF Micro Devices and Jazz Semiconductor Announce Strategic Relationship for Silicon Manufacturing and Development

10/1/2002 - RF Micro Devices, a leading provider of proprietary radio frequency integrated circuits (RFICs) for wireless communications applications, and Jazz Semiconductor, a privately held, high-performance RF and mixed-signal silicon wafer foundry, announced they have agreed to enter into a strategic relationship for silicon manufacturing and development.

Under the arrangement, RF Micro Devices will obtain a guaranteed, lower cost source of supply for wafers fabricated utilizing Jazz Semiconductor's manufacturing processes, including silicon germanium (SiGe), bipolar complementary metal oxide semiconductor (BiCMOS) and RF CMOS. In addition, RFMD will collaborate with Jazz on the development of wireless technology roadmaps, including joint process development and the optimization of these processes for fabrication of next-generation silicon RFICs. The arrangement is expected to help RFMD develop proprietary mixed-mode silicon technologies for its system-on-chip (SOC) integration roadmap.

The two companies also announced that RFMD has agreed to invest $60 million in Jazz for a minority equity position in the company. Jerry Neal, executive vice president of strategic development and co-founder of RF Micro Devices, will join the board of directors of Jazz Semiconductor. Closing of these transactions is subject to customary conditions.

Mr. Neal commented, "Jazz is a leader in advanced SiGe BiCMOS and RF CMOS manufacturing processes with substantial, state-of-the-art silicon foundry resources. We believe this strategic relationship strengthens our competitive position as an integral part of our customers' supply chains by providing us with a guaranteed source of supply for high-performance silicon manufacturing capacity. Additionally, we expect our lower cost structure will enable cost reductions across our silicon product portfolio, while facilitating expansion in new markets and generating incremental growth opportunities in current markets, such as IEEE 802.11.

"In the near term, we expect a positive impact on cycle times, cost reductions and margin improvement efforts currently underway in our power amplifier (PA) module product line. Many of the millions of PA modules we ship each month contain the industry's most advanced power control circuitry, which is manufactured under high-voltage CMOS processes and is currently sourced through traditional foundry relationships. By migrating to a strategic relationship with Jazz Semiconductor as a primary source of silicon, we expect a favorable impact on many of our highest running products. Looking forward, we expect a similar impact on our small signal, WLAN, BluetoothTM and POLARISTM TOTAL RADIOTM products."

"We are very pleased to have been selected by RFMD as their silicon manufacturing partner, and look forward to working with them to further strengthen their leading-edge wireless communications product portfolio," said Dr. Shu Li, president and chief executive officer of Jazz. "We are committed to providing cost-effective, high-performance RF and mixed-signal silicon wafer foundry solutions. Our arrangement with RFMD is indicative of the close collaboration we have with our customers, and our dedication to enabling their product development efforts."

About Jazz Semiconductor
Jazz Semiconductor manufactures semiconductor wafers that enable the development of high-performance, low-power radio-frequency (RF) wireless and broadband wireline communications products. The company's rich heritage in analog and RF integrated circuits (IC) manufacturing has evolved into a leadership position in silicon germanium (SiGe) bipolar complementary metal oxide semiconductor (BiCMOS) and silicon BiCMOS technologies and design tools that are setting the standard for communications IC foundry services. The company's wafers are manufactured using bipolar, BiCMOS, SiGe, analog, and mixed-signal CMOS process technologies. The ISO9000-certified facility includes 100,000 square feet of Class 1 clean-room space, and has the capacity to support 21,000 eight-inch wafer starts per month. Jazz Semiconductor is a privately held company headquartered in Newport Beach, Calif., and has approximately 650 employees.

About RFMD
RF Micro Devices, Inc., an ISO 9001-certified manufacturer, designs, develops, manufactures and markets proprietary radio frequency integrated circuits (RFICs) primarily for wireless communications products and applications such as cellular and PCS phones, base stations, wireless LANs, and cable television modems. The Company offers a broad array of products — including amplifiers, mixers, modulators/demodulators, and single-chip receivers, transmitters and transceivers — representing a substantial majority of the RFICs required in wireless subscriber equipment. The Company's strategy is to focus on wireless markets by offering a broad range of standard and custom-designed RFICs in order to position itself as a "one-stop" solution for its customers' RFIC needs. RF Micro Devices, Inc. is traded on the Nasdaq National Market under the symbol RFMD.

RF MICRO DEVICES®, RFMD® and POLARISTM TOTAL RADIOTM are trademarks of RFMD, LLC. BLUETOOTH is a trademark owned by Bluetooth SIG, Inc., U.S.A. and licensed for use by RF Micro Devices, Inc.

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