Actel acquires TI FPGA business; First quarter revenues off.

SUNNYVALE, Calif.--(BUSINESS WIRE)--April 3, 1995--Actel Corporation today announced that it completed its acquisition of Texas Instruments' antifuse field programmable gate array (FPGA) business on March 31, 1995. TI had been a licensed second source of Actel products since 1988. With the acquisition, Actel will expand its market presence. TI will no longer market FPGAs, but will increase the volume of FPGA manufacturing it does for Actel. Actel and TI are working together to make the transition as smooth and seamless as possible for customers.

In exchange for TI's business, Actel delivered to TI $10 million in cash and one million shares of a new series of Actel preferred stock. The preferred stock has an aggregate liquidation preference of $25 million and is convertible into 2,631,579 shares of Actel common stock. Actel also may pay TI up to $15 million based on the achievement of certain 1995 performance targets.

Actel President and CEO, John East, said, "We are delighted to have completed our acquisition of TI's antifuse business. Since TI will increase the level of foundry services that it provides to us, customers using our FPGAs should see no interruption in supply. Knowing how fiercely TI competed with us on the basis of price and service, we are confident that TI will be an excellent foundry."

As previously announced, Actel will report a loss for the first quarter of 1995 due to a significant, but at this time undetermined, one-time write-off of in-process research and development acquired from TI. The amounts of the loss and write-off will be announced in the Company's first-quarter earnings press release.

In a related development, Actel announced that its first quarter revenues were down approximately 7% from the fourth quarter of last year. Actel believes that overall quarterly revenues for the Actel architecture were up, however, due to a substantial increase in TI revenues from sales of Actel-based FPGAs. "It appears that TI's extended sales force of representatives and distributors accelerated their efforts to maximize sales following our announcement of the acquisition," said East. "While our first quarter revenues were down, we expected a transition period extending over the first two quarters. I think the underlying strength of the Actel architecture bodes well for the future."

Actel is the leading supplier of antifuse-based FPGAs and associated CAE software development systems and programming hardware. Actel antifuse FPGAs are used by designers of telecommunication, industrial, computer and space systems to differentiate their products, reduce time to market and development costs, and improve system size and performance. The company is located at 955 East Arques Avenue, Sunnyvale, CA 94086. Telephone [phone].

Texas Instruments Incorporated, headquartered in Dallas, Texas, is a high-technology company with sales or manufacturing operations in more than 30 countries. TI products and services include semiconductors; defense electronics systems; software productivity tools; printers, notebook computers and consumer electronics products; custom engineering and manufacturing services; electrical controls; and metallurgical materials.

CONTACT: Actel Corporation, Sunnyvale

H. Buford Barr (media contact), 408/522-4368

Kirk A. Ross (financial contact), 408/522-4393