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NORTHERN TELECOM AND SGS-THOMSON MICROELECTRONICS TO FORM INTEGRATED CIRCUIT TECHNOLOGY STRATEGIC ALLIANCE

 DALLAS, Oct. 22 /PRNewswire/ -- Northern Telecom and SGS-THOMSON Microelectronics today signed agreements to enter into a strategic alliance involving technology development and manufacturing of custom integrated circuit components used in digital telecommunications systems manufactured by Northern Telecom.
 Under the terms of the agreements, SGS-THOMSON Microelectronics will acquire Northern Telecom's San Diego, Calif., semiconductor manufacturing facility. SGS-THOMSON Microelectronics anticipates making offers of employment to all eligible employees. There are approximately 350 employees working at the facility.
 To maintain its current position at the forefront of new technology development, Northern Telecom will retain its semiconductor facility in Ottawa, Canada for new product and technology development, and the production of new generation components.
 Under the agreements, SGS-THOMSON will supply a large share of Northern Telecom's proprietary integrated circuit requirements. The two companies have also agreed to collaborate on the development of advanced sub-micron BiCMOS technologies used in the design and manufacture of mixed signal analog/digital integrated circuits. This development work will be carried out at Northern Telecom's Ottawa facility and by SGS- THOMSON at the new eight-inch wafer facility in Crolles, France.
 "This will allow Northern Telecom to take advantage of SGS-THOMSON's manufacturing economies of scale," said Cesar Cesaratto, vice-president, Semiconductor Components Group. "It will also allow both companies to share the significant costs associated with the development of advanced silicon technologies."
 Finalization of the agreements is subject to requisite regulatory and governmental approvals and to the fulfillment of certain contractual conditions. The parties anticipate a closing date in the first quarter of 1994.
 Northern Telecom is the leading global supplier of fully digital telecommunications switching systems, providing products and services to telephone operating companies, corporations, governments, universities and other institutions worldwide. Northern Telecom has approximately 60,000 employees and had 1992 revenues of US$8.41 billion.
 SGS-THOMSON Microelectronics is a leading European-based semiconductor manufacturer with global presence. Pursuing a strategy of technological independence, the company has developed internally a broad portfolio of advanced IC fabrication technologies and possesses its own state-of-the-art manufacturing facilities. The company has 19,000 employees worldwide and expects its sales to exceed $2 billion in 1993.
 -0- 10/22/93
 /CONTACT: Robert O'Brien, 416-566-3214, or Frank McNally, 703-712-8374, both of Northern Telecom/
 (NT)


CO: Northern Telecom; SGS-THOMSON Microelectronics ST: IN: TLS SU:

MH -- DC032 -- 5850 10/22/93 15:33 EDT
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Publication:PR Newswire
Date:Oct 22, 1993
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