April 7, 2005 Fremont, CA -- Exar has entered into a definitive agreement with Infineon Technologies wherein Exar has agreed to pay cash for a significant part of Infineon's Optical Networking (ON) business unit. The acquisition includes assets relating to Infineon's multi-rate TDM framer and fiber channel-over-SONET/SDH resilient packet ring (RPR) products, as well as certain intellectual property for its data-over-SONET products. The transaction is shortly expected to close.

"This transaction reaffirms Exar's commitment to the communications market, especially to high growth sectors such as multi-service aggregation and data over SONET/SDH markets," remarks Dr. Roubik Gregorian, president and CEO of Exar.

With the acquisition, Exar says it immediately expands its SONET/SDH product portfolio to include products covering data rates from OC-3/STM-1 to OC-192/STM-64, and supporting bandwidths up to 40 Gbits/sec. Leveraging its existing products and the acquired products, the company says it expects to strengthen its offering for high-density multi-service SONET/SDH platforms, as well as for optical crossconnects and switches.