Alliance Semiconductor Expects No Major Long Term Effect From Recent Taiwan Earthquake.

SAN JOSE, Calif.--(BUSINESS WIRE)--Sept. 30, 1999--

Alliance Semiconductor Corporation (Nasdaq:ALSC) announced today that the recent earthquake in Taiwan is expected to have no major impact on the Company's long term performance based on the latest information from United Microelectronics Corporation (UMC), one of the Company's semiconductor manufacturers.

At the time of the earthquake, Alliance Semiconductor had little material in production at UMC's Taiwan fab locations. Most of Alliance's SRAM production is now manufactured by Chartered Semiconductor in Singapore, and Alliance had recently shifted some percentage of it's DRAM production to UMC's fab in Japan.

Alliance CEO, President and Chairman N.D. Reddy said, "As a result of the earthquake, we are experiencing some short term disruption at this time with Taiwan assembly and test subcontract houses. However, based on recent information from Taiwan, we don't anticipate any major long term production problems with our Taiwan subcontractors." N.D. Reddy also said, "Alliance would like to express our support for the families and individuals in Taiwan caught up in this terrible disaster."

Recent information releases by UMC indicate that it has completed its initial appraisal of the damages caused by the earthquake on September 21st and subsequent aftershocks. Damage to the fabs were significantly less severe than originally estimated. All fab installations and equipment are in good condition with less than 10% of the total wafers in production at UMC Group fabs affected. According to UMC, power has been restored and 90% of the equipment has returned to production. Production is now expected to return to full capacity in the coming days.

On another unrelated matter, the Company announced that Mr. Sunit Saxena, VP of Operations and a corporate officer, resigned to assist with his family business. The position will be filled, as soon as possible, and until that time, Mr. Saxena will be available to assist the Company as needed.

Company Information

Alliance Semiconductor Corporation is a leading worldwide supplier of high performance memory and memory intensive logic products. Alliance's product lines include Static Random Access Memory (SRAM), Dynamic Random Access Memory (DRAM), flash memory and embedded memory and logic products.

Alliance designs, develops and markets its products to the desktop and portable computing, networking, telecommunications, instrumentation and consumer markets. Alliance manufactures its products through independent and joint venture manufacturing facilities, using advanced CMOS process technologies with line widths as narrow as 0.25 microns.

Alliance was founded in 1985 with headquarters in San Jose, California. Additional Company information can be found on our home page: http//www.alsc.com.

Forward Looking Statements

Except for historical information, the above statements of this corporate backgrounder (including, without limitation, expressions of expectation, belief, anticipation or estimation of the Company or its management) are forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in the forward looking statements. These risks and uncertainties include such factors, among others, as the potential for price erosion of the Company's products; decreased demand or increased competitive environment for the Company's products, including, without limitation, changes in the status of the SRAM, DRAM, Flash, networking and embedded memory and logic markets and the demand for the Company's SRAM, DRAM, Flash, networking and embedded memory and logic products; inability of the Company to obtain necessary capacity, timely delivery or acceptable yields from the entities that provide wafer fabrication, wafer sort, assembly and/or test services to the Company; increases in prices such entities charge the Company for wafer fabrication, wafer sort, assembly and/or test services; obsolescence of the Company's products; accumulation of excess inventory or price erosion or obsolescence of existing inventory, any of which may result in charges against the Company's earnings; inability to timely ramp up production of and deliver new or enhanced SRAM or DRAM products; inability to successfully develop and introduce Flash or networking and embedded memory and logic products; inability to successfully recruit and retain qualified technical and other personnel; adverse effects of the recent financial and economic crisis in Asia and Latin America; year 2000 issues of the Company, its suppliers, and its customers; adverse developments in current or future litigation or administrative proceedings, including; the on-going anti-dumping investigation concerning importation of DRAMs from Taiwan as well as liquidation of antidumping duties imposed on the Company's importation of Taiwan-manufactured SRAMs; and the risk factors listed under Item 1: Business and Item 7: Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's Form 10-K for the fiscal year ended April 3, 1999 and Form 10Q for quarter ended June 30, 1999, which have been filed with the Securities and Exchange Commission and which are available through the Company's home page, http://www.alsc.com. These forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or to reflect any change in events, conditions or circumstances on which any such forward-looking statement is based, in whole or in part.