JSC SITRONICS and RUSNANO Commences Construction of 90 nm Microchip Production Facilities

JSC SITRONICS (SITRONICS or the "Group") (LSE: SITR), a leading provider of telecommunications, information technology and microelectronic solutions in Russia and the CIS, with a growing presence in other EEMEA emerging markets, today announced its intention to commence the construction of 90 nanometre microchip production facilities, in cooperation with the Russian Corporation of Nanotechnologies ("RUSNANO").

A new joint venture, with equal participations of SITRONICS and RUSNANO, is expected to be created to implement the project. RUSNANO has approved up to RUR 6.5 billion of investments in the project, while SITRONICS is planning to provide equipment.

The project is expected to be implemented on the basis of the facilities of JSC “NIIME and Micron”, a subsidiary of SITRONICS. Within the framework of the project, SITRONICS intends to acquire a license from STMicroelectronics, a leading developer of semiconductor solutions, to produce 90 nanometre integrated circuits. The project might involve the creation of a design centre to design the proprietary microchips.

The range of the products to be produced within the framework of the project includes chips for industrial electronics, vehicles, digital television, the GLONASS/ GPS navigation systems, as well as chips with enhanced functionality for biometric passports and other personal documents, banking cards, SIM-cards and chips for RFID-tags, including chips designed for logistics and retail. The new integrated circuits are expected to deliver higher productivity and have a larger memory, combined with low power consumption and increasingly sophisticated protection mechanisms.

Sergey Aslanian, President and Chief Executive Officer of SITRONICS, commented: “The 90 nanometre microchip production project will enable the Russian microelectronics industry to advance to a new level. Our partnership with RUSNANO indicates that the Russian state supports this project with great dedication. Only by providing continued investments in the development of new technologies and ideas, even in the current economic environment, we will be able to maintain our competitive position and strengthen our industry leadership.”

Dionis Gordin, Managing Director of RUSNANO, added: “This project is of great importance for Russia and will allow us to implement a number of state programmes, such as the “National Technological Base 2007 – 2011” and “The Development of the Electronic Component Base and Radio 2008 – 2015”. The project is fully in line with the priorities of state policy to launch strategically important infrastructure facilities, which will enable a sustainable operation of the Russian electronic industry”.

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