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To: Don Green who wrote (38950)	3/27/2000 9:35:00 AM
From: Marcel	Read Replies (1) \| Respond to of 93625

Sherman-Act my butt! biz.yahoo.com Monday March 27, 8:12 am Eastern Time Company Press Release Electronic News Reports Hitachi to Spin-Out Microprocessor IP Start-up SAN JOSE, Calif.--(BUSINESS WIRE)--March 27, 2000--Setting the stage for what could be one of the hottest semiconductor initial public offerings (IPOs) of the decade, Hitachi Semiconductor America Inc. plans to spin off a new firm that will license out intellectual property (IP) derived from its SuperH (SH) RISC microprocessor line, according to an exclusive report in today's issue of Electronic News. The spin-off, which will be based in California's Silicon Valley, likely will be established in the second half of the year and will go public 12 to 18 months from now, according to confidential sources cited by Electronic News, a Cahners publication. The new company plans to license to other firms Hitachi's SH microprocessor IP as well as related hardware and software IP. The SH ranks among the most successful microprocessors on the market today, serving as the brains of high-profile consumer electronics goods like Sega's popular DreamCast video game console and Hewlett-Packard Co.'s Journada Windows CE-based palm-sized PC. The chip has been designed into cutting-edge products like digital still cameras and chips for digital satellite set-top boxes. Hitachi also is targeting the SH at the fast-growing market for Internet infrastructure equipment. The SH is regarded by semiconductor industry experts as a highly efficient microprocessor, whose small size and fast performance makes it suitable for a wide range of applications from consumer to computing to communications. Because of the SH's track record of success and its features, it is highly attractive to electronics companies and semiconductor firms for use in systems-on-a-chip (SOCs), which are highly integrated chips that combine all functions required to build an electronic system. The new spin-off will license the SH IP as semiconductor ``cores' that can be integrated into these SOCs, the sources told Electronic News. Observers believe the spin-off will be more successful selling the cores than Hitachi has been because the new company will be independent of a large corporate parent that competes with potential licensees. Pieces of semiconductor IP like the SH, which are unique and highly valuable, are known as ``Star IP' and typically are extremely lucrative to the companies that offer them. Examples of companies that have been successful in the Star IP licensing business include ARM Holdings plc and Rambus Inc. These small companies have all gone public in recent years and have seen remarkable rises in their market capitalization. Because of this, it is anticipated that the new spin-off will move quickly to go public to cash in on Wall Street's hunger for the stocks of Star IP semiconductor companies. ``The market is ripe for IPOs that focus on microprocessor IP,' said Jerry Ascierto, senior editor for Electronic News, who wrote the article on the Hitachi spin-off in today's edition. ``Just take a look at ARM; it licenses a small, efficient microprocessor much like the SH. ARM went public in April 1998. In the two years since, its market capitalization has exploded to about $10.8 billion, up from $498 million. The SH and its new licensing firm could be the next stars of Star IP.' The establishment of the start-up also will benefit the SH microprocessor itself in its competition with other microprocessor architectures. ``The (SH) architecture is a winner and (Hitachi) can really proliferate it a lot faster if a lot of people have access to it,' said Gerry Kaufhold, an analyst at the market research firm Cahners In-Stat, Scottsdale, Ariz. ``One of the things that has always caused the Japanese processor designers to stay a little behind the U.S. designers is that they haven't offered their key employees the chance to benefit financially from the success of the business,' said Peter Glaskowsky of the market research firm MicroDesign Resources, Sunnyvale, Calif. ``I think it's a welcome change to see a Japanese company recognize the benefit of letting a troop of creative people be more autonomous. It's refreshing.' The full story appears in today's issue of Electronic News. It can also be found on the Electronic News Web site (www.electronicnews.com). Electronic News is the news and analysis source for strategic decision makers in the electronic equipment manufacturing business. Published continuously since 1957, Electronic News is a weekly newspaper based in San Jose with a circulation of 46,000. Electronic News is published by Cahners Business Information, a leading U.S. provider of business information to 16 vertical markets, including entertainment, manufacturing and retail. Cahners' rich content portfolio encompasses 140 Web sites as well as Variety, Publishers Weekly, Design News and 127 other market-leading business-to-business magazines. Cahners developed the leading business-to-business Web portals e-inSITE in the electronics industry, Manufacturing.net in manufacturing and Buildingteam.com in construction, and maintains an active program of Internet and print launches. -------------------------------------------------------------------------------- Contact: Electronic News Jonathan Cassell (408) 345-4460 jcassell@cahners.com or Electronic News Jerry Ascierto (408) 345-4445 jascierto@cahners.com