ATI Technologies Inc. Buys Shanghai-based XGI Technology Inc. Alliance Company.

TORONTO & SHANGHAI, China -- Acquisition Increases Company's Presence in Mainland China and Adds Further Research and Development Capability

ATI Technologies Inc. (NASDAQ:ATYT) (TSX:ATY) today announced the acquisition of Shanghai-based Macrosynergy, an XGI Technology alliance company, as well as related personnel working out of XGI Technology's Santa Clara, California location. With the acquisition ATI immediately increases its presence in Shanghai, China, considered to be the epicenter of China's burgeoning technology market. At the same time the company acquires the research and design expertise of an organization best known for its multimedia add-in boards for personal computers.

"This transaction brings ATI two important elements - presence in a country that is emerging as the next big technology market, and a team of engineers that are highly skilled in our key product areas," said Dave Orton, president & CEO, ATI Technologies Inc. "The XGI and Macrosynergy people bring additional breadth of knowledge and experience to an ATI team that is leading the graphics processor market."

The acquisition will see approximately 100 Shanghai-based employees join ATI. An additional cadre of XGI employees in Santa Clara will relocate to ATI's Santa Clara location.

Currently, demand for computer hardware in China is setting a pace to achieve a 5% CAGR over the next five year period with spending on IT hardware hitting $20.3 billion in 2006, surpassing $23 billion in 2009(1). With the country expected to urbanize a billion people by 2010, strong markets for handhelds and digital televisions are also projected through the next decade.

Shanghai, the country's largest shipping port and hub to China's mainland transportation routes, is ideally suited for commercial opportunities.

"From a worldwide perspective, China will continue to be the dominant manufacturing base as well as a major market for both computers and mobile handsets," said Oliver Xu, principal Shanghai-based analyst with Gartner Inc.'s Semiconductor Group. "Therefore the acquisition is important for ATI's further success in China and will enhance the company's performance in the global market."

About ATI Technologies

ATI Technologies Inc. is a world leader in the design and manufacture of innovative 3D graphics, PC platform technologies, and digital media silicon solutions. An industry pioneer since 1985, ATI is the world's foremost graphics processor unit (GPU) provider and is dedicated to deliver leading-edge performance solutions for the full range of PC and Mac desktop and notebook platforms, workstation, set-top and digital television, game console and handheld device markets. With fiscal 2005 revenues of US $2.22 billion, ATI has more than 3,400 employees in the Americas, Europe and Asia. ATI common shares trade on NASDAQ (ATYT) and the Toronto Stock Exchange (ATY).

(1) Figures from Gartner Dataquest Market Databook, Asia/Pacific, October 2005, Emma Rose & Jitendra Jethanandani, 12 December 2005.

Important Information Regarding Forward-looking Statements

Forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "intends," "anticipates," "should," "estimates," "expects," "believes," "indicates," "targeting," "suggests" and similar expressions.

Certain statements in this news release, including but not limited to the anticipated benefits of the acquisition of Macrosynergy and related personnel, as well as the growth prospects and continued manufacturing importance of the Chinese market, may be considered "forward-looking". Such forward-looking statements are based on current expectations and entail various risks and uncertainties. Risks that could cause actual results to differ materially from such forward-looking statements include, but are not limited to, the risks that we will not realize the anticipated benefits of this acquisition, the risk of integrating new employees and operations in a timely and effective manner, and the general risks of expanding in the Chinese market. We therefore cannot provide any assurance that such forward-looking statements will materialize. We assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason. Additional information concerning risks and uncertainties affecting our business and other factors that could cause actual results to differ materially from any forward-looking statement is contained in our filings with Canadian and U.S. securities regulatory authorities, including our 2005 Annual Information Form and 2005 Annual Report filed on SEDAR at www.sedar.com. Our Form 40-F and other filings we make with the U.S. Securities and Exchange Commission are available on EDGAR at www.sec.gov.

Copyright 2006 ATI Technologies Inc. All rights reserved. ATI and ATI product and product feature names are trademarks and/or registered trademarks of ATI Technologies Inc. All other company and product names are trademarks and/or registered trademarks of their respective owners. Features, pricing, availability and specifications are subject to change without notice.

For media or industry analyst support, visit our Web site at http://www.ati.com.