3Dlabs Signs Definitive Agreement to be Acquired by Creative Technology.

Business Editors/High-Tech Writers

HAMILTON, Bermuda--(BUSINESS WIRE)--March 11, 2002

Combined Company to Drive for Increased Graphics Market Share;

3Dlabs Will Continue to Sell, Support and Develop Existing Products

3Dlabs(R), Inc. Ltd. (Nasdaq:TDDD), announced today that it has signed a definitive agreement with Creative Technology Ltd. (Nasdaq:CREAF) to be acquired in a stock and cash transaction. Subject to the terms and conditions described below, Creative will purchase 3Dlabs stock at $3.60 per share, with two-thirds being converted to Creative stock and one-third to cash, valuing the company at approximately $170 million.

The companies expect that the combination of 3Dlabs' technology and Creative's manufacturing, financial and distribution resources will enhance the development of 3Dlabs' planned products, which includes an anticipated re-entry into the volume desktop graphics market. Creative, a shareholder of 3Dlabs, has enjoyed a close relationship with 3Dlabs since the company's inception in 1994. The two companies jointly launched the industry's first 3D gaming board in 1995 and enjoyed significant mutual success with the Permedia 2 family of graphics processors.

3Dlabs will continue to supply, support and develop all of its product lines, including Wildcat(R) and Oxygen(R), with no expected disruption in supply to any of its customers. 3Dlabs will also continue to supply and support its chip and IP products to its embedded customers and will carry on its industry-leading standardization activities with OpenGL(R) 2.0, OpenML(TM) and embedded OpenGL in the Khronos Group and the Web3D Consortium.

"We see great opportunities to leverage 3Dlabs' high-end professional market leadership into higher volume PC desktop products that satisfy power gamers' insatiable demand for faster graphics," said Sim Wong Hoo, Chairman and CEO of Creative. "We have analyzed 3Dlabs' forthcoming products and technology roadmap and we believe that their development of a scalable visual processing architecture with new levels of programmability and flexibility will provide a significant competitive advantage in the graphics space. The technological breakthroughs that 3Dlabs has achieved to date, coupled with the strong market we see for high-performance graphics processors, provide a tremendous growth opportunity for our company."

"We are very excited about the opportunity provided by Creative's worldwide distribution network, huge customer base, world-famous brands, and financial resources to maximize the technology we produce," said Osman Kent, Chairman and CEO of 3Dlabs. "Integrating the resources and expertise of these two industry-leading companies can create a truly potent force in the graphics market."

Kent continued, "The timing of this acquisition is fortuitous, as we are close to releasing the most exciting high-performance graphics lineup in our history. We have experienced a difficult financial period during which we continued to devote significant resources to the development of our breakthrough technologies. Creative can provide us the resources and opportunity to expand our leadership position beyond the high end professional graphics market. We can leverage Creative's vast experience at building global brands and market share to take full advantage of the market potential for our upcoming release of an exciting new family of graphics processors for the desktop."

Under the terms of the agreement, unanimously approved by Boards of Directors of both companies, 3Dlabs shareholders will receive $1.20 in cash and Creative ordinary shares with a value of $2.40 (such shares generally to be valued based on the average closing price on NASDAQ for the 10 trading days ending on the fifth trading day prior to the 3Dlabs' shareholder meeting to approve the transaction) for each share of 3Dlabs. Closing of the transaction is subject to the approval of 3Dlabs shareholders, expiration of the U.S. HSR antitrust waiting period and other customary closing conditions.

Conference Call Information

The Company will conduct a conference call at 8:00 AM, Pacific Time, on Monday, March 11th to discuss the acquisition and its year end results. You may access the call in the United States by dialing 888/294-1704 or via the Internet at www.3dlabs.com. International callers may listen to the call by dialing 212/993-0201. A replay of the call will be available for 24 hours, one hour after the live call ends and at the 3Dlabs web site. To access the telephone replay from the United States please dial 800/558-5253, with passcode 20430963. International callers please dial 416/626-4100, with passcode 20430963.

About Creative

Creative (Nasdaq:CREAF) is the worldwide leader in digital entertainment products for the personal computer and the Internet. Famous for its Sound Blaster(R) and for launching the multimedia revolution, Creative is now driving digital entertainment on the PC platform with products like its highly acclaimed NOMAD(R) Jukebox. Creative's innovative hardware, proprietary technology, applications and services leverage the Internet, enabling consumers to experience high-quality digital entertainment -- anytime, anywhere.

About 3Dlabs

3Dlabs is a market-leading graphics vendor, supplying graphics accelerator solutions for professionals in Computer Aided Design (CAD), Digital Content Creation (DCC) and visual simulation markets. Its award-winning Oxygen and Wildcat graphics are available in the industry's top OEM workstations, through an international distributor/reseller network, and directly to end-users at 3Dlabs' online store. For more information on 3Dlabs, visit www.3dlabs.com.

Forward Looking Statements

Various matters set forth in this press release, such as statements relating to Creative's ability to successfully exploit the technological and market position of 3Dlabs; 3Dlabs' expansion into the mainstream desktop graphics market; Creative's ability to integrate 3Dlabs into Creative's operations; Creative's ability to deploy 3Dlabs' personnel and technologies on Creative's' products; the future competitiveness and OEM or end-user acceptance of 3Dlabs' products are forward looking statements. These statements are subject to risks and uncertainties, including without limitation, the ability and willingness of the 3Dlabs' manufacturing partners to produce products in a timely and cost-effective manner and in sufficient quantities; the ability of the 3Dlabs to obtain and keep design wins for these products; the ability of the 3Dlabs' products to adequately meet the price/performance requirements of its customers; the success of 3Dlabs' customers in achieving sustained demand for systems incorporating the 3Dlabs' current and future products; the impact and pricing of competitive products; the impact of the acquisition on the 3Dlabs' business; the introduction of alternative technological advances and other risks detailed from time-to-time in 3Dlabs' SEC reports.

Note to Editors: 3Dlabs, Oxygen, Wildcat and Permedia are trademarks or registered trademarks of 3Dlabs Ltd., 3Dlabs Inc. Ltd., or 3Dlabs Inc. in the United States and/or other countries. OpenGL is a registered trademark of SGI Inc. Sound Blaster and Nomad are trademarks of Creative Technologies Ltd. All other trademarks are acknowledged and recognized.