TSMC and ASE Group Announce Strategic Alliance

Science-Based Industrial Park, Hsin-Chu, Taiwan, March 4, 1997 - Taiwan Semiconductor Manufacturing Company (TSMC) will formalize and alliance with Advanced Semiconductor Engineering Group (ASE) to provide customers access to advanced packaging services effective March 1, 1997. In making the announcement, TSMC chairman Dr. Morris Chang characterized the move as strategic for the company's Virtual Fab initiative. With ASE, TSMC's Virtual Fab will provide customers a process flow from wafer fabrication, advanced IC assembly and test services, to direct delivery of packaged parts.

"Our two companies are world leaders in specialized IC manufacturing services," said Dr. Morris Chang. "This alliance leverages our Virtual Fab to a new level of service for our customers."

Announced in September of 1996, TSMC's Virtual Fab utilizes automation and information technology to give customers complete access to their production and shipping schedules, simulating the convenience of having an in-house fab. By providing customers with increased flexibility and control to meet their production requirements, the Virtual Fab enhances the partnership between TSMC and its customers.

"From our strategic proximity in the fastest growing IC manufacturing center of the globe, we can together create unparalleled efficiency, economy, quality and comprehensive service for out customers," added ASE chairman and CEO, Jason Chang.

ASE is the world's largest independent packager of integrated circuits in Taiwan and a leader in offering packaging, testing and drop shipment services to its customers. The company offers a broad range of testing services which include testing logic and memory functions of packaged ICs.

TSMC is the world's largest and fastest growing dedicated semiconductor foundry manufacturing more than 1.5 million six-inch wafers per year in 1996. The company offers CMOS fabrication processes that focus on advanced logic, mixed signal and a wide array of memory processes. The company posted growth of 37% in 1996. Currently, the company's 6-inch fabs (Fabs 1, 2A and 2B) put out 100,000 wafers per month. Fab 3, which commenced 8-inch wafer output in September of 1995 is in volume production for a variety of customers, having ramped to 25,000 8-inch wafers per month in 1996. TSMC fabs are located in Hsinchu, Taiwan. The company has subsidiaries in the United States and Europe. In mid-1996, TSMC broke ground on its first U.S. foundry, WaferTech - a $1.2 billion joint venture with Altera, Analog Devices and ISSI. Launching production in 1998, the new fab will have a monthly output of 30,000 8-inch wafers.