DIGITAL AND INTEL ANNOUNCE LONG TERM AGREEMENT TO EXPAND RELATIONSHIP;
MOVE TO SETTLE LITIGATION
Intel to purchase Digital's Semiconductor operations;
Provide foundry services for Alpha* chips
Digital to develop systems based on Intel's 64-bit architecture
Santa Clara, Calif. and Maynard, Mass. -- Oct. 27, 1997 -- Digital Equipment
Corporation and Intel Corporation today announced that they have agreed to
establish a broad-based business relationship that will provide significant
short- and long-term benefits to both companies and their customers.
The multi-year agreement includes sale of Digital's semiconductor manufacturing
operations to Intel for approximately $700 million, cross- licensing of patents,
supply of both Intel and Alpha* microprocessors and development of future
systems based on Intel's 64-bit microprocessors. No other financial details were
Digital and Intel agreed to request a stay of all lawsuits until U.S. government
approval is granted which is required to finalize the agreement.
"This agreement meets both companies' needs," said Craig Barrett, president and
chief operating officer of Intel. "We are pleased to get alignment with one of
the world's major computer companies on IA-64 microprocessors and to let the
marketplace judge our work."
"This agreement brings issues between the two companies to a resolution that
benefits customers in many important ways," said Digital Chairman
Robert B. Palmer. "It ensures long-term availability of Digital's Alpha-based
offerings for OpenVMS, Digital UNIX and Windows NT customers. In addition,
Digital will develop Digital UNIX and Windows NT offerings on the IA-64
Key components of the agreement pending government approval:
- Digital and Intel will enter into a 10 year patent cross license agreement.
- Intel will purchase Digital's semiconductor operations including state-of-the-
-art facilities in Hudson, Massachusetts as well as development operations in
Jerusalem, Israel and Austin, Texas for approximately $700 million.
- Digital will retain its Alpha and Alpha-related semiconductor design teams to
continue to develop future generations of Alpha. Intel will make offers of
employment to other Digital semiconductor employees.
- Intel will serve as a foundry for Digital for multiple generations of Alpha
- Intel will provide Intel products and comprehensive technical support to
Digital consistent with practices for other major Intel OEMs.
- Digital will develop a full line of systems based on Intel's IA-64 processor
- Digital will port, with technical assistance from Intel, its industry-leading
Digital UNIX to Intel's IA-64.
- Intel will obtain rights to manufacture and sell other non-Alpha Digital
"Digital's mission is to deliver with our partners Internet business solutions
based on high-performance platforms and services," Palmer said. "This agreement
strengthens our ability to offer products that help make our customers more
competitive and confirms our dual Alpha and Intel platform strategy."
Digital Equipment Corporation, recognized for product and service excellence, is
a leading supplier of high-performance, Web-based computing solutions which help
enterprises compete in the global marketplace. Digital gives its customers a
winning Internet advantage through a comprehensive portfolio of Internet
solutions based on award-winning systems, advanced networking infrastructure,
innovative software, and industry applications -- including those from its
business partners. The expertise and experience of Digital employees help
customers plan, design, implement, manage and support Internet solutions in
countries throughout the world. For the latest company information, visit
Digital on the World Wide Web at http://www.digital.com
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.com/pressroom
* Other names and brands may be claimed as the property of others.