Japan's Premier DRAM Supplier Sharpens its Focus on Stronger DRAM Market Position

TOKYO, JAPAN, October 3, 2002 -- Elpida Memory, Inc. and Mitsubishi Electric Corp. announced today that they have reached the basic agreement to start discussing the integration of Mitsubishi Electric's Dynamic Random Access Memory (DRAM) operations with Elpida Memory. The agreement is expected to be reached by the end of this year, with the goal of integrating the DRAM business by April 2003. In addition, this agreement will allow Elpida Memory to form a new alliance with Powerchip Semiconductor Corp. that would serve as a foundry for Elpida's DRAM production. Elpida Memory is a joint venture launched by NEC and Hitachi in 1999, specializing in DRAM business. Upon completion of this agreement, Elpida will be the only major DRAM supplier in Japan, and will likely move its market position to number four in the world from number five.

"We are delighted with the opportunities that are presented before us as a result of our recent discussions with Mitsubishi Electric and Powerchip," said Kenji Tokuyama, president of Elpida Memory, Inc. "The added products and capacity will strengthen our position in the market so we can continue to deliver Elpida's world-class technology to our customers."

Mitsubishi Electric Transfers DRAM Products and Intellectual Property to Elpida
As part of the agreement, Elpida will gain the right to acquire all of Mitsubishi Electric's standard DRAM devices and modules that are currently produced on Mitsubishi Electric's 0.15 micron and smaller process technologies. The agreement will include the intellectual property related to those products. Mitsubishi Electric will provide Elpida with customer and technical support during the integration stage. "This transition makes good business sense considering current market conditions," said Dr.Koichi Nagasawa, Exective Vice President of Mitsubishi Electric. "We are looking forward to working closely with Elpida Memory to ensure a smooth transition for our DRAM."

Powerchip to Serve as Elpida DRAM Foundry
Concerning the alliance between Elpida and Powerchip, Elpida will provide it's world-class DRAM process technology to Powerchip, and in turn, Powerchip will produce DRAMs using this technology at Powerchip's manufacturing facilities and provide the resulting DRAM products to Elpida. Initially Powerchip will continue to use the 0.13/0.12 micron process technology provided by Mitsubishi Electric as part of the integration agreement. In the future, Elpida Memory will provide the process technology needed for DRAM production. This will enable Elpida to reduce its investment risk during the expansion of its business by utilizing Powerchip as an external foundry, and at the same time, Powerchip will be able to obtain the world's-first 0.11 micron processing technology currently being developed by Elpida. Both Elpida and Powerchip continue to aspire to build close cooperation in their businesses.

"Elpida is a world leader in DRAM technology," said Frank Huang, chairman and CEO of Powerchip Semiconductor Corp., "We are grateful to Mitsubishi Electric for opening the door to new relationships while continuing to build on our past successes. This alliance will accordingly activate a whole new business cooperative relationship between Elpida and PSC. On the basis of the existing Mitsubishi Electric's DRAM technology, PSC is able to further acquire Elpida's advanced process technology and expand its foundry customer base. Technology integration and exchange between both parties will be mutually beneficial to each other's 300 mm wafer production."

Mitsubishi Electric will also commission Powerchip to be its foundry for System LSI products and will continue to develop new business relationships based upon existing mutual trust.

Elpida Achieves New, Stronger Market Position
Elpida's new 300 mm wafer production facility in Hiroshima, Japan, is on schedule to begin volume DRAM product in January 2003. The alliances with Mitsubishi and Powerchip, combined with this week's start of Elpida's 300 mm manufacturing demonstrate Elpida's commitment to growing its presence in the DRAM market. According to Dataquest, Elpida's 2001 DRAM marketshare was 8.5% and Mitsubishi's DRAM market share was 2.6 %.

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About Elpida Memory, Inc.
Elpida Memory, Inc. is a technology leader in Dynamic Random Access Memory (DRAM) with headquarters based in Tokyo, Japan, and sales and marketing operations located in Japan, North America, Europe and Asia. Elpida offers a broad range of leading-edge DRAM products including RDRAM®, SDRAM, DDR SDRAM, Mobile RAM and Consumer SDRAM. Device densities currently range up to 512 Megabits each, and Module (DIMM) densities range up to 2 Gigabytes each. Elpida offers a variety of standard and high performance packaging techniques, including TSOP, BGA, FBGA, Tape Carrier Package (TCP), and Double Density Package (DDP). Elpida's research, design and development operations were merged from NEC and Hitachi on April 1, 2000 and sales and marketing operations commenced in Q1, 2001. Elpida's main DRAM foundries are located at NEC Hiroshima and Hitachi Nippon Steel Semiconductor Singapore. Elpida's own 300 mm DRAM wafer manufacturing facility is scheduled to begin production by January 2003. For datasheets and more information, visit Elpida's World Wide Web site at http://www.elpida.com/.

About Mitsubishi Electric
With over 80 years of experience in providing reliable, high-quality products to both corporate clients and general consumers all over the world, Mitsubishi Electric Corporation (FTSE: 6503q.l) is a recognized world leader in the manufacture, marketing and sales of electrical and electronic equipment used in information processing and communications, space development and satellite communications, consumer electronics, industrial technology, energy, transportation and building equipment. The company has operations in 35 countries and recorded consolidated group sales of 3,649 billion yen (US$27.4 billion) in the year ended March 31, 2002. For more information about Mitsubishi Electric, visit http://Global.MitsubishiElectric.com/.

About Powerchip Semiconductor
PSC is a professional wafer manufacturer in Taiwan. The Company uses advanced process technology and offers world-class products with excellent yield and quality. Our business includes commodity Dynamic Random Access Memory (DRAM) production and wafer foundry of niche DRAM, SRAM, embedded DRAM and CMOS image sensors. PSC currently owns a state-of-the-art 8-inch fab, running at its monthly capacity of 40,000 wafers with 0.165 um process technology. PSC has also completed its first 12-inch fab, designed with a full capacity of 35,000 wafers, which is slated for mass production in Q4 2002 with 0.13um process technologies. In the future, Fab 2 will focus on the manufacture of cutting-edge DRAM products while Fab 1 will gradually shift to full foundry services, including logic products, fostering the Company's long-term competitiveness in semiconductor industry. For more information about PSC, please log on to our web site at http://www.psc.com.tw/.

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Media contacts: Elpida Memory Asia/Japan David Huerta Ozma Inc. - PR for Elpida Memory, Inc. (Japan) +81-(0)3-3403-9504 david@ozma.co.jp Europe Peter Westerdorf Elpida Memory, Inc. 0049 (0)211 23945120 peter.westerdorf@elpida.com North America Tammy Lee Lee Communications - PR for Elpida Memory (USA) Inc. 877-677-9533 Mitsubishi Electric Robert Barz Public Relations Dept. +81(0)3-3218-2346 Robert.Barz@hq.melco.co.jp Powerchip Semiconductor Eric Tang, Spokesman Powerchip Semiconductor Corp. 886-2-25170055-8250 Eric_tang@psc.com.tw