The conversion will result in reduced production costs and the ability to quickly add additional capacity as needed.

“The recent announcement of VLSI’s new leadership VSC11 0.15-micron process technology, coupled with today’s announcement of our 8-inch conversion, will allow VLSI to maintain technology leadership and to meet customer demands,” said Alfred J. Stein, VLSI chairman and CEO.

The conversion of the San Antonio fab to process eight-inch wafers will have the effect of doubling the potential production of ICs from this facility with no increase in headcount or floor space requirements.

An eight-inch wafer accommodates nearly twice the silicon dice than a six-inch wafer. To illustrate this, a six-inch wafer can carry 134 one-centimeter square dice while an eight-inch wafer can hold 252 dice. The upgrade program for San Antonio will start immediately with qualification planned for the third quarter of 1999 and full production expected in the first quarter of 2000.

About VLSI Technology

VLSI Technology, Inc. designs and manufactures custom and semicustom integrated circuits for leading firms in the wireless communications, networking, consumer digital entertainment and computing markets.

VLSI’s value proposition is based on full-service customer support, deep libraries of vertical market-focused IC intellectual property, unparalleled custom circuit design expertise enabled through the Velocity(TM) Rapid Silicon Prototyping design style, and one of the world’s most flexible and efficient custom circuit manufacturing facilities in San Antonio.