Intel To Acquire Xircom For Approximately US$748m

AUCKLAND Jan 16, 2001 - Intel Corporation and Xircom, Inc. today announced that they have entered into a definitive agreement under which Intel, through a wholly owned subsidiary, would acquire Xircom for US$25 per share in an all-cash tender offer valued at approximately US$748 million. In addition, Intel will assume all existing vested and unvested employee options. The acquisition complements Intel’s existing desktop PC and server-based network access businesses by enabling Intel to provide new products for notebook and mobile computing uses.

Xircom, based in Thousand Oaks, Calif., is a supplier of PC cards and other products used to connect mobile computing devices to corporate networks and the Internet. Xircom is a leader in innovative small-form-factor networking products and has strong and well-established sales channel relationships.

“The acquisition of Xircom provides Intel with an award winning line up of products and technologies in the fast growing mobile computing area,” said Mark Christensen, Intel vice president and general manager of Intel’s Network Communications Group. “Xircom’s strengths in small-form-factor design combined with our silicon expertise will allow us to provide customers with new and innovative solutions for linking mobile computing devices to corporate wired and wireless networks.”

“The combined strengths of Intel and Xircom will be a tremendous benefit to our customers,” said Dirk Gates, Xircom chief executive officer. “Customers will have access to a more complete line of products and will benefit from the innovation our combined companies will apply to mobile computing and wireless networking.”

The agreement provides for a cash tender offer to acquire all of the outstanding shares of Xircom common stock at US$25 per share, which will commence within 10 working days. The Board of Directors of Xircom has approved the definitive agreement and has unanimously recommended that Xircom stockholders tender their shares pursuant to the offer. Intel’s obligations to accept shares tendered in the offer will be conditional
upon the tender of a majority of outstanding Xircom shares on a fully-diluted basis, regulatory approvals and other customary conditions, and compliance by Xircom with certain financial and business criteria.

The tender offer will expire 20 business days after it is commenced, but may be extended under certain circumstances. The current chief executive officer of Xircom has agreed to tender his shares in the offer. It is expected that all shares not purchased in the tender offer will be converted into the right to receive US$25 per share in a second-step merger
following the tender offer.

The acquisition is expected to be completed in the first quarter of this year. Upon completion of the acquisition, Xircom will become a wholly owned subsidiary of Intel. The organization will be part of Intel’s Network Communications Group.

Xircom sells and supports its products in over 100 countries through distributors, resellers, electronic channels and global OEM partnerships. Headquartered in Thousand Oaks, Calif., with regional headquarters in Belgium, Japan and Singapore, Xircom has 1,900 employees worldwide and trailing four-quarter revenues of US$492 million. Please visit
www.xircom.com for more information.

Intel, the world’s largest chip maker, is also a leading manufacturer of computer, networking and communications products. Additional information about Intel is available at www.intel.co.nz

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