Alliance Semi Acquires Chip Engines

SANTA CLARA, Calif. -- Alliance Semiconductor Corporation (Nasdaq: ALSC) today announced the Company has agreed to terms to acquire Chip Engines, Inc., a leading fabless supplier of silicon solutions for next generation Metropolitan Area Network (MAN) platforms. Based in Sunnyvale, California, Chip Engines' Adaptive Computing Engine (ACE) architecture combines the clock efficiency and flexibility of stored program microprocessors, the parallelism and hardware resources of field programmable gate arrays (FPGA) and the speed and density of an ASIC. Chip Engines was an Alliance Venture investment in 2001, and the first company to develop a family of integrated circuits based on the Resilient Packet Ring (RPR), Multi-Protocol Labeled Switching (MPLS) and Differentiated Services Code Point (DSCP); which are the basis of next generation 10 Gbit Ethernet and MAN switching and routing systems. The company's MAN building blocks enable telecommunication system OEMs to offer equipment that makes it profitable for carriers and service providers to replace traditional fixed bandwidth, flat-rate services with differentiated classes of service for voice, data, audio, and video applications. The transaction is expected to close within ninety days and has been approved by the board of directors of both companies. "The Chip Engines' product line is an excellent complement to our System Logic Solutions business unit due to the opportunities it creates for penetrating the emerging Metro market." said Alliance Chairman, President and CEO, N.D. Reddy "By combining the Chip Engines' technology with the Alliance product portfolio, it expands the possibilities for today's system architects and designers by providing design options based on HyperTransport, PCI and popular networking and interconnect technologies not previously available. Alliance remains focused on exploring additional acquisition opportunities, such as this one, that are both synergistic and strategic in nature, and continue to build upon the growth and diversification plan implemented last year." Chip Engines Inc. Alliance Semiconductor Corp.