Agreement concluded between Packard Bell and NEC on merger of worldwide PC operations; transaction creates $8 billion global PC power to be called ''Packard Bell NEC''.

SACRAMENTO, Calif.--(BUSINESS WIRE)--July 15, 1996--Packard Bell Electronics Inc. and NEC Corp. Monday announced that they have officially concluded the transaction announced on June 4, 1996, which calls for NEC's worldwide personal-computer operations outside Japan to merge with Packard Bell, creating ``Packard Bell NEC Inc.''

The company expects the first full year of operations to yield combined sales of approximately $8 billion. The transaction is valued at approximately $300 million and is the next logical step in the global alliance announced in August 1995 and February 1996 between Packard Bell, NEC and Groupe Bull.

Packard Bell NEC is a leader in multiple channels, in multimedia and in growing product categories such as notebooks, high-end multiprocessor servers and Internet-related products. According to 1995 Dataquest information, Packard Bell NEC would have been the largest PC company in the United States in 1995, with a 15.1 percent market share.

Packard Bell NEC, together with NEC's PC-9800 series business in Japan, would have commanded 11.4 percent of the worldwide market share. These figures include Zenith Data Systems, which was purchased by Packard Bell from Groupe Bull in April 1996.

As announced last month, Beny Alagem, formerly the head of Packard Bell Electronics, will serve as chairman, chief executive officer and president of Packard Bell NEC and will direct the operations of the Sacramento-based company.

``We are extremely pleased that this merger has come to fruition and we can extend our leadership as the most innovative and most respected global PC seller in every segment of the industry. We are committed to serve the home, corporate and institutional markets, and Packard Bell NEC will do this more efficiently than ever,'' commented Alagem.

``The response to this transaction by our employees, customers, suppliers and others has been fantastic. Ultimately, the consumer is the big winner as the combined infrastructure of Packard Bell and NEC assures quality performance, technological innovation and great value,'' he added.

Dr. H. Kaneko, NEC president, stated: ``Packard Bell NEC will lead the way in bringing cutting-edge, easy-to-use and affordable technology to global markets. Our combined strengths give us an optimal infrastructure to research, design, manufacture, market and service the best products for consumers.''

When the merger is fully implemented, Packard Bell NEC will employ approximately 6,000 people throughout the United States and 8,000 globally. Packard Bell NEC will operate manufacturing facilities in Sacramento; Fife, Wash.; Angers, France; Australia; and China.

In addition, technical and service/support facilities are located in the United States, Europe and the Far East; research and development facilities are located in the United States, Europe and Israel. Overall, the company is represented in more than 125 countries.

Packard Bell NEC is further positioned for future multimedia- technology development as a result of NEC's engineering and technological expertise, from electronic components and devices to telecommunications. Packard Bell NEC and NEC will collaborate in the development of notebooks and servers and integrate their PC- server operations in the United States and Europe.

Additionally, Packard Bell NEC will aggressively pursue relationships with innovative, third-party companies and individuals to explore, develop and market advanced software and technology for multimedia and Internet applications.

Since Packard Bell shipped its first computer in 1987, it has pioneered the mass marketing of PCs through the retail channel and achieved a remarkable 44 percent share of the U.S. retail PC market. Packard Bell is already the No. 1 manufacturer of desktop PCs for the U.S. retail channel, according to Audits and Surveys, and fourth- largest in worldwide sales, according to International Data Corp.

In the past year, strategic ventures with NEC and Groupe Bull have provided the company with added technological and financial strength as the company has experienced significant growth in its major market sector. The three companies, Packard Bell, Groupe Bull and NEC, maintain a close strategic alliance.

``Our commitment to world-class technological innovation, efficiency, quality and service is enhanced by NEC's management team and its track record for technological advances and engineering quality. With this and other recent initiatives, Packard Bell NEC is poised for phenomenal growth over the next five years -- so much so that we anticipate a highly valued public offering of Packard Bell NEC stock within two years to ensure the capital is available to support that growth,'' Alagem said.

For more information on the Sacramento-based company regarding news releases, technical-support contacts, product updates, etc., visit http://www.packardbell.com on the World Wide Web.

CONTACT: Ketchum Public Relations, Los Angeles 

Robert A. Wittenburg, 310/444-1316