UMC and Infineon Announce Success and Optimization of their Technology and Manufacturing Partnership

Partners achieve 90nm silicon success and high-yield production for SOC ICs leveraging 130nm process technology on 300-mm wafers

HSINCHU, Taiwan, and MUNICH, Germany, August 6, 2003 – UMC (NYSE:UMC) and Infineon Technologies AG (Infineon) (NYSE:IFX), today announced success in their 90nm development program with the delivery of functional complex circuitry utilizing the industry’s most advanced production technology. This milestone confirms that this technology is ready to move to production later this year. The companies also announced the success of their 300-mm joint engineering efforts with the achievement of high-yield pilot production for a 130nm SoC IC targeted at mobile applications and incorporating sensitive analog/mixed mode circuitry. Despite the challenges of 300-mm production, these chips are currently being produced at UMC fabs at yield levels that equal or surpass those attained by similar products on mainstream 200-mm wafers.

Dr. Andreas von Zitzewitz, chief operating officer (COO) at Infineon, said, “While Infineon was one of the very first companies to demonstrate the economical advantages of high-volume manufacturing of DRAMS on 300-mm wafers, we have now managed to attain a similar milestone for complex SoC ICs with analog and mixed-mode functionality, in close cooperation with our technology and manufacturing partner UMC. We are very pleased with this joint success. It clearly demonstrates the power of real partnerships to enhance progress in leading-edge silicon technology production.”

Dr. Jackson Hu, CEO of UMC, explained, “We are very excited about the progress that we have made working with Infineon to achieve working 90nm silicon and to reach high-yielding production for 0.13um SOCs on state-of-the-art, 300-mm wafers. This validates the success of UMC’s partnership approach, and our ability to work closely with key customers to develop processes that enable them to meet their time-to-silicon and time-to-volume requirements. We intend to continue our partnership programs based on technology developed by UMC and optimized to achieve the goals of our many customers.”

Having achieved the primary objectives of their joint development program, UMC and Infineon plan to continue their cooperation on process development through joint engineering efforts in specific advanced technologies needed for IFX product success.

In this context and to better meet Infineon’s requirements as a foundry partner, the companies also agreed that UMC would buy back Infineon’s equity share in UMCi Pte Ltd. UMCi is the Singapore manufacturing venture formed in April 2001 by Infineon, UMC, and Singapore’s Economic Development Board investment arm (EDBI). EDBI will retain its equity position in UMCi.

This move will allow Infineon and UMC to concentrate on their broader manufacturing partnership, and give Infineon a more flexible manufacturing approach that includes access to all of UMC’s wafer fabs. The parties anticipate large volume production to ramp up initially at UMC’s Taiwan facilities, and later at UMCi, as its production capacity comes on line. UMCi is currently on track with its equipment installation as announced earlier this year.

About UMC
UMC (NYSE: UMC, TSE: 2303) is a leading global semiconductor foundry that manufactures advanced process ICs for applications spanning every major sector of the semiconductor industry. UMC delivers cutting-edge foundry technologies that enable sophisticated system-on-chip (SOC) designs, including 90nm, 0.13um copper, embedded DRAM, and mixed signal/RFCMOS. UMC is also a leader in 300-mm manufacturing; Fab 12A in Taiwan is currently in volume production for a variety of customer products, while the Singapore-based UMCi joint venture will begin pilot production later this year. UMC employs over 8,500 people worldwide and has offices in Taiwan, Japan, Singapore, Europe, and the United States. UMC can be found on the web at http://www.umc.com.

About Infineon
Infineon Technologies AG, Munich, Germany, offers semiconductor and system solutions for the automotive and industrial sectors, for applications in the wired communications markets, secure mobile solutions as well as memory products. With a global presence, Infineon operates in the US from San Jose, CA, in the Asia-Pacific region from Singapore and in Japan from Tokyo. In fiscal year 2002 (ending September), the company achieved sales of Euro 5.21 billion with about 30,400 employees worldwide. Infineon is listed on the DAX index of the Frankfurt Stock Exchange and on the New York Stock Exchange (ticker symbol: IFX). Further information is available at www.infineon.com.

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