Sale of Emblaze Semiconductor to Zoran Corporation.

Business Editors

RAANANA, Israel--(BUSINESS WIRE)--June 7, 2004

Emblaze Ltd. (LSE:BLZ) ("Emblaze") announces today the sale of its wholly owned subsidiary, Emblaze Semiconductor Limited (the "Semiconductor Business") to the semiconductor solutions provider Zoran Corporation (NASDAQ:ZRAN) ("Zoran").

Emblaze will transfer its shareholding in the Semiconductor Business, together with the balance of any outstanding inter-company loans payable to Emblaze, to Zoran for a total consideration of US $54.2 million payable in cash.

Emblaze Mobile, the handset subsidiary of Emblaze will remain a strategic customer of Zoran for the application processor devices. Therefore, Emblaze will purchase chipsets and other technology components from Zoran for the development of the Emblaze Mobile next generation handsets.

The Board of Emblaze believes that ownership of the Semiconductor Business is no longer central to its vision and business. Under the ownership of Emblaze, the Semiconductor Business has developed three successive generations of multimedia application processors and achieved significant design wins with handset manufacturers including Samsung, Telson, DBTell, Bird and many others. The Board believes that whilst Emblaze has taken the Semiconductor Business to significant achievements, the next phase of development will be best achieved with the support and direction of a leading semiconductor solutions provider such as Zoran.

The sale of Emblaze Semiconductor is a part of Emblaze's strategy to focus its business towards increasing performance and shareholders' value. The move will significantly increase Emblaze cash reserves without having a material impact on revenues this year. The sale does not include the MPEG-1 product line, which will be transferred from the Semiconductor Business to Emblaze prior to closing.

Eli Reifman, Chief Executive Officer of Emblaze Ltd. said:

"After the recent years' downturn in our sector, I believe it is prudent for us to monetize our non-core assets and enable the group to focus its efforts on its core competency of selling end-to-end server and handset solutions to global operators. We regret that this means we will be separating from the superb people at Emblaze Semiconductor but we will continue our working relationship with them as our handset subsidiary Emblaze Mobile continues to use their cutting edge processors. We are happy to have Zoran as our new partner and welcome their contribution to our future business."

Uzi Breier, CEO of Emblaze Semiconductor said:

"This is the natural progression for our semiconductor business. We grew it as far as we could and have achieved a lot. We believe that a market leader of Zoran's stature can bring this business to the next level with its complementary technologies in the consumer electronics and digital imaging sectors. Zoran has proven many times its ability to achieve true global leadership. Zoran will be a great partner for Emblaze and a warm new home for Emblaze Semiconductor's employees."

Levy Gerzberg, President & CEO, Zoran said:

"Zoran is now poised to become a major technology solution supplier to the high growth multimedia mobile phone market. We believe that by combining the strengths of both Zoran and Emblaze Semiconductor, Zoran will be able to deliver advanced technology and cost effective solutions to the mobile phone market leveraging our broad experience in the consumer electronics market. The Emblaze Semiconductor team has proven it is capable of delivering complete solutions for the multimedia mobile phone market and we are proud that they will be joining Zoran."

Emblaze's Semiconductor Business provides semiconductor-based solutions for high volume multimedia mobile phones and other appliances. Its family of multimedia application processors and co-processors is geared to the mid to high-end feature mobile phones. Emblaze Semiconductors' application processors are shipping in several handsets and the company has achieved a number of design wins with additional cellular handset designers and manufacturers.

The operating loss (excluding amortisation and impairment of goodwill and intangible assets) attributable to the Semiconductor Business for the year ended 31 December 2003 was US$8,965 thousand. As of 31 December 2003 the Semiconductor Business had net assets in the amount of US$750 thousand.

Notes to Editor:

About The Emblaze Group (Emblaze Ltd.):

Following the disposal of the Semiconductor Business, Emblaze Ltd will consist of three companies sharing a common vision to lead the market transformation to rich media personal communication. Emblaze Systems, a leading provider of end-to-end solutions for wireless multimedia; Emblaze Mobile, a rich media smart-phone design house; and Orca Interactive, a global market leader providing solutions for commercial iTV services.

About Zoran Corporation:

Zoran Corporation, based in Sunnyvale, California, is a leading provider of digital solutions-on-a-chip for applications in the growing consumer electronics markets. With two decades of expertise developing and delivering digital signal processing technologies, Zoran has pioneered high-performance processing into various audio, video, and imaging applications. Zoran's proficiency in integration delivers major benefits for OEM customers, including greater capabilities within each product generation, reduced system costs, and shorter time to market. Zoran-based DVD, digital camera, DTV and imaging products have received recognition for excellence and are now in millions of homes and offices worldwide. With headquarters in the U.S. and operations in Canada, China, Europe, Israel, Japan, Korea, and Taiwan, Zoran may be contacted on the World Wide Web at www.zoran.com or at 408-523-6500.