New Company to Deliver Innovative, Cost-Effective Non-Volatile Memory
                                 Solutions

    GENEVA and SANTA CLARA, Calif., May 22 /PRNewswire-FirstCall/ --
STMicroelectronics, Intel and Francisco Partners today announced they have
entered into a definitive agreement to create a new independent
semiconductor company from the key assets of businesses which last year
generated approximately $3.6 billion in combined annual revenue. The new
company's strategic focus will be on supplying flash memory solutions for a
variety of consumer and industrial devices, including cellular phones, MP3
players, digital cameras, computers and other high-tech equipment.
    The new company will combine key research and development,
manufacturing and sales and marketing assets of Intel and
STMicroelectronics into a streamlined worldwide structure with the scale to
produce cost-effective and innovative non-volatile memory solutions. With
STMicroelectronics and Intel contributing more than 40 years of combined
experience in non-volatile memory technology development, including
next-generation phase-change memory, the company will be well positioned to
both serve its customers with complete memory solutions and accelerate the
move to future non-volatile memory technologies.
    "The new company will be positioned to service customers with all of
the elements necessary to deliver current and next-generation non-volatile
memory technologies, while allowing ST to redefine its participation in
flash memory," said Carlo Bozotti, STMicroelectronics president and CEO,
and non- executive chairman designate of the new company.
    "The new memory company will have the people, scale and technology
leadership to meet the needs of customers requiring leading-edge products
in this highly competitive marketplace," said Paul Otellini, Intel
president and CEO.
    "From the outset, the company will be a leading supplier of flash
memory solutions for wireless communications," said Brian Harrison, named
to become the CEO of the new company at the close of the transaction and
currently vice president and general manager of Intel's Flash Memory Group.
"We will be able to offer customers complete solutions with NOR- and
NAND-based technologies, which we believe will provide significant
opportunities for growth and the potential to develop products for many new
application areas and geographic regions."
    Under the terms of the agreement, STMicroelectronics will sell its
flash memory assets, including its NAND joint venture interest and other
NOR resources, to the new company while Intel will sell its NOR assets and
resources. In exchange, Intel will receive a 45.1 percent equity ownership
stake and a $432 million cash payment at close. STMicroelectronics will
receive a 48.6 percent equity ownership stake and a $468 million cash
payment at close. Francisco Partners L.P., a Menlo Park, Calif.-based
private equity firm, will invest $150 million in cash for convertible
preferred stock representing a 6.3 percent ownership interest, subject to
adjustment in certain circumstances. Concurrently, the parties have
arranged for the new company to receive firm commitments for a $1.3 billion
term loan and $250 million revolver. The term loan will be underwritten by
a consortium of banks. Proceeds from the term loan will be used for working
capital and payment to Intel and STMicroelectronics for the purchase price.
The transaction is subject to regulatory approvals and customary closing
conditions and is expected to occur in the second half of 2007.
    "The new company will immediately be able to offer a very broad range
of non-volatile memory solutions in order to address the needs of a wide
variety of communications and industrial customers," said Dipanjan Deb,
founder and managing partner at Francisco Partners.
    The new company, to be managed by Brian Harrison as CEO-designate and
Mario Licciardello, currently corporate vice president of ST's Flash
Memories Group as COO-designate, will be headquartered in Switzerland and
incorporated in the Netherlands with nine main research and manufacturing
locations around the world and approximately 8,000 employees. The company
will also benefit from a worldwide sales force.
    With assets and resources from Intel and STMicroelectronics, including
a patent portfolio of approximately 2,500 patents and 1000 patents pending,
the new company will have the scale to benefit from the increasing demand
for memory resulting from the growing amount of information and content
that is becoming more mobile and is now based almost entirely on digital
technology. The integration of STMicroelectronics' and Intel's parallel
programs on phase- change memory, a key technology capability, will also
help to bring the benefits of advanced flash memory technology to potential
customers more quickly and efficiently.
    About Intel
    Intel, the world leader in silicon innovation, develops technologies,
products and initiatives to continually advance how people work and live.
Additional information about Intel is available at http://www.intel.com/pressroom.
    About STMicroelectronics
    STMicroelectronics (NYSE: STM) is a global leader in developing and
delivering semiconductor solutions across the spectrum of microelectronics
applications. An unrivalled combination of silicon and system expertise,
manufacturing strength, Intellectual Property (IP) portfolio and strategic
partners positions the Company at the forefront of System-on-Chip (SoC)
technology and its products play a key role in enabling today's convergence
markets. The Company's shares are traded on the New York Stock Exchange, on
Euronext Paris and on the Milan Stock Exchange. In 2006, the Company's net
revenues were $9.85 billion and net earnings were $782 million. Further
information on ST can be found at http://www.st.com.
    About Francisco Partners
    Francisco Partners is a leading global private equity firm focused
exclusively on investments in technology and technology-enabled services
businesses. With approximately $5.0 billion of committed capital, Francisco
Partners pursues structured investments in technology companies, targeting
investments in private companies, public companies, and divisions of public
companies, with transaction values ranging from $30 million to $3.0
billion. For additional information, visit http://www.franciscopartners.com