Atmel to Sell ASIC Business, Related Manufacturing Assets

Atmel(R) Corporation (Nasdaq: ATML) announced that it is pursuing strategic alternatives for the Company’s ASIC business and related manufacturing assets, including a potential sale. This is a further step in Atmel’s transformation plan, which is aimed at focusing on the Company’s core microcontroller business and enhancing its cost structure.

“Atmel’s Board and management team are focused on fully realizing the value of our company,” said Steven Laub, Atmel’s President and Chief Executive Officer. “Over the last year, we have taken decisive actions to improve and restructure nearly every aspect of Atmel’s operations. The exploration of strategic alternatives for our ASIC business is another step in Atmel’s ongoing transformation plan. Our ASIC business is a market leader in multiple segments, but is not a core component of our long-term strategy to build a microcontroller based company. As we proceed with this process, we will remain focused on continuing to drive technological leadership in our core business and providing innovative products and services for our ASIC customers.”

Atmel’s ASIC business is a leading provider of high performance customer specific integrated circuits and security solutions to the industrial, aerospace and consumer markets operating in three distinct segments: Customer Specific Products (CSP), Smart Cards (SMS) and Aerospace. The ASIC business also includes an advanced 200mm fab located in Rousset, France, and a test and finishing operation located in East Kilbride, Scotland, UK, along with related design, operation, marketing, sales and support resources. Revenues for the ASIC business totaled $416 million for the twelve months ended December 31, 2008.

Morgan Stanley is serving as Atmel’s financial advisor in connection with the evaluation of strategic alternatives for the ASIC business.

About Atmel
Atmel is a worldwide leader in the design and manufacture of microcontrollers, advanced logic, mixed-signal, non-volatile memory and radio frequency (RF) components. Leveraging one of the industry’s broadest intellectual property (IP) technology portfolios, Atmel provides the electronics industry with complete system solutions focused on consumer, industrial, security, communications, computing and automotive markets.