Company contact:

Steve Della Rocchetta

408-530-0885

sdr@silterra.com

Media contacts:

Stacey Gaswirth or Katie Olivier

972-774-9850

sgaswirth@dvscommunications.com

kolivier@dvscommunications.com

KULIM, Malaysia (April 10, 2001) - Silterra Malaysia Sdn. Bhd. ("Silterra"), a full-service semiconductor manufacturing provider, signed an agreement on 16 March, 2001 with Seiko Instruments Inc. ("SII"), a leading Japanese high technology company, whereby SII will make a strategic investment in Silterra. In return for its investment of more than US$50 million, SII is granted certain capacity rights to Silterra's 0.25- and 0.18-micron process technologies.

"We welcome SII as our partner and look forward to a lasting mutually beneficial relationship," stated Mr. Cy Hannon, President and CEO of Silterra. "The addition of SII as a customer and investor supports our strategy of providing foundry services on a world-wide basis. This relationship gives Silterra an immediate presence in the Japan market at a time when there is increased interest in outsourcing."

"We are pleased to participate in this venture with Silterra. This agreement enables SII to gain access to foundry capacity for important emerging technologies," said Mr. Junichi Hattori, President and CEO of SII. "Silterra is uniquely positioned as a full-service semiconductor manufacturer with the ability to play a strong role in the foundry market. And, when coupled with the trend in outsourced manufacturing, create an outstanding opportunity for SII."

Silterra's first wafer fabrication facility has been built as a cost of US$1.5 billion (Ringgit 5.7 billion). To date, equity financing has been provided primarily by Khazanah Nasional Berhad and Bank Industri Malaysia Berhad (both wholly owned companies of the Ministry of Finance of the Government of Malaysia), LSI Logic Corporation and BI Walden. Long term debt financing has been provided by U.S. ExIm Bank (US$674 million or Ringgit 2.6 billion) and Japan Bank for International Cooperation (Yen 5 billion or Ringgit 159 million).

Tan Sri Sheriff Kassim, Chairman of Silterra board of directors, stated, "In addition to setting goals for our facility to be online and in volume production, our business strategy and operations have been streamlined to better position Silterra to achieve sustainable growth and increase the company's brand awareness. In doing so, we are very pleased to attract equity financing from a company of SII caliber." SII's equity investment and wafer purchase from Silterra will contribute towards strengthening the financial structure for our company and facilitate its expansion plans, he added.

SII Investments in Silterra

Volume production has begun in Silterra's malaysian facility, and will reach the full capacity of 30,000 eight-inch wafers per month in 2002. The company is offering leading-edge 0.25-, 0.22-, and 0.18-micron process technologies to its customers. More advanced technologies (0.13-micron) and RF capabilities will also be available in the future.

About Seiko Instruments Inc. ("SII")

Today, the name SEIKO is synonymous with quality craftsmanship in timepieces and advanced electronics engineering. As the primary manufacturing and engineering arm of the SEIKO Group, Seiko Instruments Inc. ("SII") founded in 1937, is proud of its tradition of precision manufacturing and technical innovation. Earning recognition the world over for its elegant and sophisticated timepieces, SII has rapidly progressed into challening new fields of Information Technology and nano-technology. From wearable devices to electronic components, SII boldly takes the lead in creating new products and technologies to serve mankind better - today and in the future. http://www.sii.co.jp

About Silterra Malaysia Sdn. Bhd.:

Silterra Malaysia Sdn. Bhd. is a full-service semiconductor manufacturing provider that offers customers leading-edge process technologies. With volume production beginning in 1Q 2001, Silterra will ramp to capacity, 30,000 eight-inch wafers per month, by 2002. Founded in 1997, Silterra's headquarters and factory are located in Kulim, Malaysia, with a sales and marketing office in Sunnyvale, California. For further information on Silterra or its services, visit www.silterra.com.

Advisors:

In consummating this investment with SII, Silterra was advised by JP Morgan while SII was advised by Fuji Corporated Advisory.

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