Arch Chemicals and Lee Chang Yung Chemical Sign Letter of Intent To Form a Joint Venture to Market Semiconductor Chemicals in Taiwan.

NORWALK, Conn.--(BUSINESS WIRE)--May 4, 1999--

To serve a growing base of semiconductor fabrication plants in Taiwan, Arch Chemicals and Lee Chang Yung Chemical (LCY) of Taiwan have signed a letter of intent to form a 50-50 joint venture that will manufacture, distribute, and market process chemicals and thin film systems to the semiconductor industry in Taiwan.

Located in Taiwan, LCY manufactures solvents that are used extensively in the semiconductor industry. Their basic manufacturing position, and existing manufacturing infrastructure in Taiwan, will provide the joint venture with distinct competitive advantages. Arch's Semiconductor Chemicals and Services business is already a leading supplier of process chemicals and thin film systems in North America and Europe, and is committed to growing its presence in Asia as well.

"Through our future joint venture with LCY, a well-respected chemical company in Taiwan, we can accelerate our growth in Asia and provide our customers there with a full range of semiconductor chemicals and services," said Arch Chemicals Chairman and CEO Michael E. Campbell. "The timing of our joint venture is excellent, for there are signs that key Asian economies and the semiconductor sector are poised for a return to strong growth."

"The field of microelectronic chemicals and materials will be LCY's emphasis and future growth areas," said the chairman of LCY, Bowei Lee. "The current cooperation with Arch Chemicals perfectly matches our strategy and business model."

The joint venture when formed will sell semiconductor chemicals to the Taiwan market. The venture is expected to eventually expand sales activities to customers in the People's Republic of China and possibly Southeast Asia. By agreement of the parties, the joint venture will not sell photoresists and related ancillary products, which are already being sold in Asia by an existing joint venture between Arch Chemicals and Fuji Photo Film of Japan. That joint venture - FUJIFILM Olin - has manufacturing facilities in Japan and Taiwan.

Headquartered in Taipei, Taiwan, LCY has a publicly traded chemicals unit with annual sales of approximately U.S.$350 million and a privately held real estate operation.

Arch Chemicals' Microelectronic Chemicals segment consists of two business units - Photopolymers and Semiconductor Chemicals and Services. In addition to manufacturing process chemicals and thin film systems at plants in Arizona and Belgium, the Semiconductor Chemicals and Services business also offers chemical management services to customer plants worldwide to handle all of their wet chemical needs. Arch's Chemical Management Services has recently been expanded to encompass ultra-pure gases, chemical distribution equipment and services through an alliance with Air Liquide.

Headquartered in Norwalk, Conn., Arch Chemicals is a global specialty chemicals company with annual sales of approximately $900 million. It has three business segments - Microelectronic Chemicals, Water Chemicals and Performance Chemicals - that employ 3,000 people worldwide.