Seoul, Korea, October 6, 2004 MagnaChip Semiconductor (www.MagnaChip.com) was launched today as a carve-out from Hynix Semiconductor Inc., (www.hynix.com) in a transaction led by Citigroup Venture Capital (CVC) Equity Partners, L.P., CVC Asia Pacific Ltd., and Francisco Partners. Under terms of the transaction, Hynix sold its non-memory semiconductor operations to MagnaChip Semiconductor for approximately KRW 954 billion or US$828.4 million in total consideration.

MagnaChip Semiconductor has five wafer fabs located in Korea, with current manufacturing capacity of approximately 110,000 8” equivalent wafers per month. The company has more than 15,000 patents in its extensive intellectual property portfolio covering its display driver, CMOS image sensors and applications solution processor business. Major customers include Haier, LG Electronics, LG Philips, NEC, Panasonic, BOE-Hydis, Samsung and Sharp, among others. The Company has 4,200 employees, including its 650 person research and development staff.

Dr. Youm Huh, President and Chief Executive Officer of MagnaChip Semiconductor, said, “MagnaChip is positioned in the marketplace as a leading semiconductor solution company. Our focus will be on establishing recognition for the new MagnaChip Semiconductor brand, continuing to build our extensive R&D capabilities, and improving and expanding our customer relationships. I greatly appreciate CVC’s leadership and support throughout the two years it took to architect and execute this transaction, along with CVC and Francisco Partners’ combined semiconductor expertise and the support of the entire Hynix leadership team in launching MagnaChip as an independent company.”

"Our new independent structure will allow us to leverage a significant history of technology development and manufacturing leadership, and a portfolio of leading product solutions,” continued Dr. Huh. “As an independent entity, we will have even more flexibility to tailor our semiconductor development and manufacturing services to our customers’ needs, in order to effectively support their product roadmaps. At the same time, we will remain focused on developing innovative products through targeted investments in research and development, while further improving our internal business processes to deliver increased value to our customers and investors. With expected sales of US$1 billion for the full year 2004, MagnaChip is quickly becoming one of the world’s largest semiconductor manufacturers.”

About MagnaChip Semiconductor
MagnaChip Semiconductor (formerly Hynix Semiconductor’s System IC Business) is one of the world’s leading semiconductor manufacturers, with world-class technical capabilities and five fabs located in Korea. The Company develops, manufactures and distributes system IC chips, focusing on Display Driver IC’s, CMOS Image Sensors and Application Solution Processors, along with the Company’s Foundry business. MagnaChip has worldclass manufacturing capabilities and an extensive portfolio of more than 15,000 patents. As a result, MagnaChip is a valued partner in providing leading technology solutions to companies worldwide. For more information visit www.MagnaChip.com.

About Citigroup Venture Capital Equity Partners, L.P.
Citigroup Venture Capital Equity Partners, L.P. ("CVC") is one of the world’s oldest and largest private equity firms, founded in 1968, and currently manages funds in excess of $8.0 billion. CVC has significant expertise in technology investments, acquired over decades of investing in the world’s leading growth companies.

About CVC Asia Pacific Ltd.
CVC Asia Pacific Ltd. is one of the leading private equity firms in Asia, and is a joint venture between Citigroup and CVC Capital Partners. CVC Asia Pacific and its affiliates manage over US$8.0 billion in capital. CVC Asia Pacific has completed 15 buyout transactions in the region, including five previous investments in Korea.

About Francisco Partners
With $2.5 billion of committed capital, Francisco Partners is one of the world’s largest technology-focused private equity funds. The firm was founded to pursue structured investments in technology companies undergoing strategic, technological, and operational inflection points. Francisco Partners targets majority and minority investments in private companies, public companies, and divisions of public companies, with transaction values ranging from $30 million to $2.0 billion. The principals of Francisco Partners have a proven track record, having invested in excess of $3.0 billion of equity capital in over 50 technology companies during the past decade, including several of the most successful buyouts effected to date. The firm also has an exclusive, long-term relationship with Sequoia Capital, one of Silicon Valley’s most prominent and successful venture capital firms. For additional information, visit www.FranciscoPartners.com.


http://www.magnachip.com/