Atheros Acquires ZyDASAtheros Acquires ZyDAS

SANTA CLARA, Calif. -- Atheros Communications, Inc. (NASDAQ:ATHR) , a leading developer of advanced wireless solutions, today announced that it has signed a definitive agreement to acquire ZyDAS Technology Corporation, a privately held Taiwan-based fabless IC design company specializing in high-performance IEEE 802.11 wireless LAN (WLAN) semiconductor and software solutions for PC, mobile and embedded applications. ZyDAS is headquartered in Taiwan's Hsinchu Science Park, one of the world's most active areas for semiconductor design and manufacturing.

Through the acquisition, Atheros will significantly enhance its engineering capabilities and expand its technical staff. ZyDAS has over 70 employees who will join Atheros, approximately 75 percent of whom are involved in Research & Development (R&D). The R&D leaders each possess more than 15 years of experience in DSP Algorithm, IC Design, Channel Characterization, Communication Protocol and real-time OS. ZyDAS will become Atheros' new Taiwan Research & Development Center.

"ZyDAS is a proven wireless technology leader with its widely adopted and cost-effective 802.11g and 802.11a/g USB designs," said Craig Barratt, president and chief executive officer of Atheros. "ZyDAS' accomplished technical design team and innovative solutions make them a strong complement to Atheros. This acquisition will enhance our world-class engineering team and provide an additional R&D center to support Atheros' ongoing global expansion into new wireless markets."

The cash and stock transaction, currently valued at approximately $23 million, may include an additional consideration to shareholders if certain defined milestones are achieved. The transaction is expected to close during Atheros' second fiscal quarter ending June 30, 2006, and remains subject to fulfilling regulatory requirements and other customary closing conditions. Atheros may record a one-time charge for purchased in-process research and development expenses. The amount of that charge, if any, has not yet been determined.

Atheros Communications Inc. (Nasdaq: ATHR)