First Round Closes; Massana Secures $7 Million in Venture Financing; Funds to Fuel New Broadband Communications Designs and Global Expansion.

CAMPBELL, Calif.--(BUSINESS WIRE)--Dec. 8, 1999--

Massana Inc., a high-profile semiconductor IP (SIP) company specializing in solutions for broadband communications and high-speed networking, announced today that it has secured first-round financing of $7 million from a transatlantic venture capital syndicate led by ACT Venture Capital in Europe.

Co-Investors in Massana with ACT are U.S. investment firms BancBoston Capital of Boston, Mass., and Vision Capital Inc. of Menlo Park, Calif. ACT is one of the leading technology focused venture capital firms in Europe.

BancBoston Capital offers focused high tech industry expertise, with more than 50 Internet and technology investments worldwide. Vision Capital specializes in funding transatlantic high tech companies emerging in the U.S. market. Both John Flynn of ACT and John Turner of Vision Capital will join Massana's Board of Directors.

"We are delighted to close this round of investment. It is a strong validation of our business strategy and technology and gives Massana the backing to embark on our goal of becoming a global semiconductor company," said Paul Costigan, CEO of Massana.

"In addition, this consortium of key U.S. and European investors provides clear value-added in their financial and business strengths and further ensures Massana's success going forward."

"This capital infusion will accelerate Massana's rapid growth in providing such new products as Fast and Gigabit Ethernet DSP-based PHYs, ADSL and VDSL, VoIP and VoDSL solutions, making the company uniquely positioned to support these next-generation System-on-a-Chip markets," said Irving Gold, Massana's Vice President Marketing and Sales.

"At the same time," Gold added, "we will also fuel an aggressive two-year worldwide expansion of our global marketing and sales organization."

John Flynn of ACT said, "The requirement for an investment in this explosive broadband communications and networking space is an exceptional level of engineering talent and a management team with commitment and vision. Massana has both of these.

"The company's recently launched FILU product family has already gained significant market acceptance and we believe the company has the ability to exploit its proprietary silicon and DSP technology to develop a leading global position in the emerging high-speed Gigabit Ethernet market."

About Massana

Massana's mission is to provide lightning-fast bandwidth via its proprietary silicon solutions for standards-based broadband communications and Fast/Gigabit Ethernet networking systems, delivering these products through patented DSP module compiler technology coupled with proprietary DSP algorithms.

Among the company's clients/partners are Alcatel (NYSE:ALA), Analog Devices (NSYE:ADI), Motorola (NSYE:MOT), Nortel Networks (NYSE/TSE:NT), and Toshiba (Tokyo Stock Exchange).

Visit the Company on the Internet at www.massana.com.

Or, for further information, contact: Paul Costigan CEO, Massana Inc., 51 E Campbell Avenue, Campbell CA 95008. Phone: [phone]; Fax: [phone] [e-mail]. Irving Gold VP Marketing and Sales, Phone: [phone]; Fax: [phone]; [e-mail]. John Flynn ACT Venture Capital, Phone: [phone]; [e-mail].

About ACT Venture Capital

ACT Venture Capital is Ireland's leading private equity company, providing venture and development capital funding. ACT's specialist technology team has extensive investment experience in the ICT sector.

ACT recently announced the second closing of its 100 million Euro ACT '99 fund, which is backed by leading financial institutions from Ireland, the U.K., and mainland Europe. ACT Venture Capital's total funds under management are 200 million Euros.

About Vision Capital

Vision Capital is a $110 million U.S.-based venture capital fund providing growth capital for leading technology companies, which are poised for rapid expansion into global markets. Vision invests in promising European and U.S. technology companies and then takes an active, hands-on approach in expanding these businesses across the Atlantic.

Typically, Vision helps its portfolio companies in building up their market presence, finding industrial and strategic partners, working with management to define growth strategies which includes the identification of acquisition candidates, and assisting in the building and expanding of sales and distribution channels.

The Vision partners are all highly experienced professionals in both industry and venture investing, having collectively financed more than 150 companies prior to founding Vision Capital.

Vision is headquartered in Menlo Park, Calif., and has a European office in Geneva, Switzerland.

About BancBoston Capital

BancBoston Capital is the private equity arm of Fleet Boston Financial Corporation (formerly BankBoston Corporation), the major U.S. international banking group. BancBoston Capital's worldwide IT operation focuses on Internet, software and communications. The group has more than 50 portfolio companies and has an affiliated network of 20 strategic IT venture partnerships.

Robertson Stephens, the Section 20 subsidiary of Fleet Boston, is a leading international investment bank focused on growth companies in the technology, life science and healthcare, information & business services, retail and consumer products, real estate, telecommunications, media, broadcasting, and gaming and lodging sectors.