Infineon to Finalize Restructuring of the Fiber Optics Business: Manufacturing Facility in Czech Republic to be Sold to Siemens VDO Automotive

Munich, Germany – November 14, 2005 – After the sale of a significant part of the Fiber Optics group, Infineon Technologies AG (FSE/NYSE: IFX) announced today that it has worked out solutions for all outstanding Fiber Optics assets that remained at Infineon: the manufacturing facility in Trutnov (Cz) and the Paroli business.

 

The automotive supplier Siemens VDO has signed a definitive agreement to take over Infineon's plant in Trutnov from July 1 ^st, 2006, on. Until next summer, Siemens VDO and Infineon plan to work in parallel at the Trutnov site, thus enabling Siemens VDO to ramp-up its production of electric motor drives while allowing Infineon to continue fulfilling all of customers’ requirements. Siemens VDO intends to recruit its personal preferentially among the current Infineon workforce. As of today, Infineon employs approximately 500 people in Trutnov.

 

The Paroli products have been put on “End-of-Life” status with mutual agreement regarding the respective key customer requirements. Consequently, the customers have placed their last time buy orders which will be fulfilled by Infineon over the course of the next quarters.

 

In August 2005, Infineon has signed a definitive agreement with EZConn Corporation of Taiwan concerning the sale of the business with bidirectional components (BiDi) for FTTx applications. Under the terms of this agreement, EZconn acquired all assets and IP needed to continue and to grow the business with FTTx products. The deal includes Infineon's wafer level micro-module processes, an enabling technology for the next generation of higher performance and more efficient volume OSA manufacturing. Furthermore EZconn will open a design and marketing center in Berlin, Germany offering key employees of Infineon new jobs to continue serving Infineon's and EZconn’s customers.

 

In January 2005, Infineon sold the Fiber Optics transceiver business to Finisar Corporation. Soon thereafter, the Plastic Optical Fiber (POF) business was reorganized to become part of Infineon’s Automotive, Industrial and Multi-Market (AIM) Business Group.

 

Overall, the restructuring measures undertaken led to the elimination of operating losses in the fiber optics business.

Infineon Technologies AG, Munich, Germany, offers semiconductor and system solutions for automotive, industrial and multimarket sectors, for applications in communication, as well as memory products. With a global presence, Infineon operates through its subsidiaries in the US from San Jose, CA, in the Asia-Pacific region from Singapore and in Japan from Tokyo. In fiscal year 2004 (ending September), the company achieved sales of Euro 7.19 billion with about 35,600 employees worldwide. Infineon is listed on the DAX index of the Frankfurt Stock Exchange and on the New York Stock Exchange (ticker symbol: IFX). Further information is available at www.infineon.com.