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MARSHALL INDUSTRIES,
ELECTRONICS INDUSTRY HEADLINE NEWS

July 1, 1996



Microchip To Acquire ASIC Technical Solutions
Microchip Technology Inc. moved to strengthen its semiconductor offerings last
week, acquiring quick-turn ASIC specialist ASIC Technical Solutions Inc. (ATS).
The purchase of ATS allows Microchip to enter the programmable-logic
replacement device market, competing directly with FPGA and CPLD vendors and
gate- array-conversion suppliers. The move will also allow Microchip to
integrate its successful 8-bit microcontroller cores with configurable gate
arrays to provide custom solutions.

"We always tend to look for underserved marketplaces, and this appears to be
another area where the market dynamics have created a large hole or
opportunity," said Phil Chapman, chief financial officer for Chandler,
Ariz.-based Microchip. "We think this is a market ripe for a company of our
size and resources to dramatically expand." The move is quite similar to
contract manufacturer DII Group's agreement last month to acquire Orbit
Semiconductor Inc., a larger, more established provider of gate-array-c
onversion services.

Microchip is paying about $2 million up front to acquire ATS from founder,
president, and chief executive Kash Johal. A second payment will be made to
Johal at the end of 1999, "which is substantial, and based on the performance
of the business," Chapman said. Johal will serve as director of Microchip's new
ASIC Products Division, based in ATS' San Jose     headquarters.