AYALA ELECTRONICS SUBSIDIARIES MERGE TO ENHANCE COMPETITIVENESS

Integrated Microelectronics, Inc. (IMI), Ayala Corporation's electronics flagship company, recently announced that it would merge its subsidiary, Electronic Assemblies Inc. (EAI), into IMI effective January 1, 2003 to be more globally competitive. The decision was made by the stockholders of both companies during their meeting held on September 17, 2002.

The merger represents the best strategic alternative for delivering increased value to both companies stockholders in addressing the challenges and opportunities in a fast changing global market.

IMI president and CEO Arthur R. Tan said,“The merger allows IMI to create a stronger and more efficient operating model which translates to improved earnings. It will also position IMI to attract and retain the best employees who will be working in boundary-less collaboration.

Tan added,“We believe that quick and decisive action is needed to address the business opportunities and challenges facing our business operation. The merger provides stronger partnerships with both our customers and suppliers. The focus is not just cost reduction synergies, but also synergies that will generate revenues.

The merger is expected to effectively sustain IMI capital requirements and improve its positioning for future public listing plans.