Diodes announces additional capacity with new sourcing and marketing agreements.

WESTLAKE VILLAGE, Calif.--(BUSINESS WIRE)--June 14, 1995--Diodes Inc. (ASE: DIO), a leading distributor of discrete semiconductor components, has established new strategic alliances with Shanghai Kai Hong Electronics Co. Ltd. ("Kai Hong") and Lite-On Power Semiconductor Corp. ("LPSC").

Diodes announced that it will provide Kai Hong with $2 million in assistance toward the construction of a new facility for the manufacture of SOT-23s; total cost of plant and equipment is estimated at $4 million. Diodes' involvement will assure it a new source of surface-mount products for which there is an ever-increasing demand and that are in short supply worldwide.

Diodes also announced that it has further strengthened its marketing agreement with LPSC: it is now the exclusive reseller (with the exception of a few house accounts) for LPSC in North America.

The SOT-23 facility, expected to be operational by mid-1996, will be built in Shanghai. The agreement is structured in such a way that Diodes' investment will not affect earnings in fiscal 1995. In a collateral agreement, Diodes will also provide Kai Hong with an additional $350,000 in cash and equipment to facilitate the manufacture of MELFs, with shipments expected to begin in the latter half of 1995. In each case, Diodes' funding will be recovered through product purchased from Kai Hong on a compensation trade basis.

"We have had an excellent relationship with one of Kai Hong's subsidiaries for the past three years," said David Lin, president and CEO of Diodes, "and we are especially pleased that this new affiliation will afford our customers a reliable source of high- quality surface-mount products, which are in great demand as OEMs increasingly move to miniaturization and robotic assembly."

"In both the Kai Hong and LPSC agreements," added Lin, "we have sought to enhance our ability to procure in a timely fashion and at reasonable cost the products that our customers need."

LPSC, a manufacturer of discrete components that since 1991 has owned approximately 46% of Diodes' common stock, has contributed significantly to the company's success and in 1994 supplied almost 20% of its product. Lin observed that, given the anticipated growth in Diodes' overall business, LPSC's percentage of Diodes' total sales can be expected to continue at about this level.

Diodes is a leading supplier of discrete semiconductor products to the automotive, electronics/computing and telecommunications industries. Its products include a broad line of standard, zener and signal diodes, bridge rectifiers, small signal transistors, transient voltage suppressors (TVSs), and power MOSFETs.

CONTACT: Diodes Inc.

Joseph Liu, 805/446-4800

or

KBL Associates Inc.

Philip Bourdillon/Ken Kline, 818/583-8091