PHILIPS COMPONENTS and RITEK ANNOUNCE JOINT VENTURE for OPTICAL MEDIA PRODUCTION in EUROPE Submitted By: Pleon Thursday, 20 May 1999

PHILIPS COMPONENTS AND RITEK ANNOUNCE JOINT VENTURE FOR OPTICAL MEDIA PRODUCTION IN EUROPE Submitted by: Pleon Thursday, 20 May 1999

Philips Components, a division of Royal Philips Electronics of the Netherlands, and Ritek Corporation today announced that they have signed a Letter of Intent to establish a joint venture company in Europe to manufacture optical media such as Magneto-Optical (MO), CD-Recordable (CD-R) and CD-ReWritable (CD-RW). Ritek will acquire a 70 percent shareholding of the new company. Financial details are not being disclosed. The preliminary agreement encompasses two activities, namely, production and technical cooperation. Existing Philips Magneto-Optical production, located in Wiesbaden, Germany, will transfer to the newly formed entity headquartered in the same city. Philips Components and Ritek will also conduct technical cooperation for mass manufacturing of optical media. The new company will sell its products to Philips and other original equipment manufacturers (OEMs) and it plans to invest in production capacity for CD-Recordable. Philips and Ritek expect the new company to be operational during the second half of 1999. Ritek Media Relations Shu-feng Hsiung, tel. +886 2 2997 2822 Philips Components Media Relations Tom McGuire, tel. +31 40 272 4239 Ritek Corporation, headquartered in Hsinchu, Taiwan, is the world's leading manufacturer of optical media products. Established in 1988 as the first Taiwanese company entering into the optical media industry, Ritek develops leading edge products and optimizes its manufacturing processes to provide its customers with the industry's highest quality, cost-effective optical storage media and services. With over 1,300 employees, Ritek's manufacturing and replication operations have grown to annual profits exceeding US$49 million based on 1998 sales of US$169 million. Ritek's Earning Per Share has maintained at US$0.155 (par value per share US$0.311) in the past three years. Ritek is quoted on the Taiwan Stock Exchange. Additional information about

Page 1 Ritek is available at www.ritek.com.tw Philips Components, headquartered in Eindhoven, the Netherlands, is a world leader in providing fully integrated and innovative electronic solutions in display, storage, key components and power management. Based on technology leadership and customer knowledge, it provides competitive advantages for original equipment manufacturers (OEMs) in the consumer electronics, electronic data processing, telecommunications and automotive industries. Philips Components, with 1998 revenues of US$5.9 billion, employs 40,000 people in 39 countries. Information about Philips Components is available at www.philips.com Royal Philips Electronics of the Netherlands is one of the world's biggest electronics companies and Europe's largest, with sales of US$33.9 billion in 1998. It is a global leader in color television sets, lighting, electric shavers, color picture tubes for televisions and monitors, and one-chip TV products. Its 228,800 employees in more than 60 countries are active in the areas of lighting, consumer electronics, domestic appliances, components, semiconductors, medical systems, business electronics, and IT services (Origin). Philips is quoted on the NYSE, London, Frankfurt, Amsterdam and other stock exchanges. News from Philips is located at www.news.philips.com

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