Leading Companies Invest in MontaVista Software

MontaVista Software, Inc., the company powering the embedded revolution, today announced four new investors -- Siemens Venture Capital, which leads the funding, as well as Samsung Ventures America, Infineon Ventures and China Development Industrial Bank. These investments in MontaVista Software, an embedded Linux platform and tools supplier, increase the company's cash reserves by $7 million. The total investment in MontaVista Software, since it was formed in 1999, is now more than $72 million.

These global firms join other high-profile corporate investors in MontaVista Software, including IBM Microelectronics, Intel Capital, Panasonic (Matsushita), Sony, Toshiba America and Yamaha Corporation, as well as top-tier venture capital firms, such as Alloy Ventures, RRE Ventures, US Venture Partners, and WR Hambrecht + Co.

"MontaVista revenues increased 77 percent last year and we gained more than 500 new design wins, many with Fortune 100 and Global 500 corporations, bringing our worldwide installed base to more than 1200 customers," said Jim Ready, CEO and president, MontaVista Software. "This additional funding represents a strong vote of confidence in MontaVista from three leading international technology companies and from the premiere financial institution in Taiwan."

The proceeds will be used to augment MontaVista Software's cash reserves.

In August 2003, Gartner Inc. reported that the Embedded Software Tools Total Available Market was close to $1 billion. In this survey (2002 Worldwide Embedded Software Tools Market Share, August 14, 2003, Nancy Wu and Daya Nadamuni), MontaVista Software was listed among the top embedded OS companies. Last year, Venture Development Corporation placed MontaVista Software as the #1 commercial embedded Linux company worldwide, based on market share. In Japan, the Fuji-Keizai Group, a leading provider of market and industry information, reported last year that MontaVista Linux garnered almost half (46.3%) of embedded Linux projects in Japan, while MontaVista Software represented almost two-thirds (63.4%) of the embedded Linux market revenues in Japan.

"Because of its flexibility and ease of use, Linux is becoming essential for many embedded applications that our customers develop, ranging from high-performance communications equipment to low-cost, low-power consumer devices," said Bjoern Christensen, president and CEO of Siemens Venture Capital. Luis Llovera, investment partner at Siemens Venture Capital, who executed the deal, commented, "We recognize the tremendous traction that MontaVista Software has gained in the important area of embedded software solutions. We look forward to a strategic relationship that will meld the strengths of MontaVista Software with Siemens' global leadership in electronics."

"Last year, Samsung Electronics announced a licensing agreement to use MontaVista Linux, an industry leading embedded Linux platform, in Samsung's advanced electronics devices," said Young Choe, vice president of Samsung Electronics' Corporate Software Center. Jay Eum, managing director of Samsung Ventures America, added, "Our investment -- through Samsung Ventures America -- cements the strong, mutually beneficial relationship between Samsung and MontaVista Software. We believe MontaVista will play a dominant role in the embedded software industry as the transition to Linux accelerates. We look forward to working closely together with MontaVista to ensure our joint success."

"Many of our customers are moving to Linux because it removes the risk and cost associated with developing in-house software, while leveraging the tremendous expertise of the open source community," said Mahesh Balakrishnan, managing director, Infineon Ventures North America. "Our goal with this investment in MontaVista Software is to guarantee the availability of a quality Linux product for advanced semiconductor platform offerings."

"MontaVista Software provides a robust and quality product, for which there is real demand, especially in Taiwan and China, where Linux is already the fastest growing embedded OS," said Irene Shih, assistant vice president, China Development Industrial Bank Inc. "We expect the demand for embedded Linux will continue to increase at a rapid rate, and believe MontaVista Software has a management team that can successfully execute on this opportunity."

About MontaVista Software

MontaVista Software is a leading global supplier of systems software and development tools for intelligent connected devices and associated infrastructure. MontaVista powers the embedded revolution by providing Open Source GNU/Linux-based software solutions. Founded in 1999 by real-time operating system pioneer James Ready, MontaVista offers a family of products that address software developer needs encompassing applications ranging from communications infrastructure to consumer electronics. MontaVista products include MontaVista Linux Professional, Consumer Electronics and Carrier Grade Editions. MontaVista DevRocket, a powerful integrated development environment, delivers state-of-the-art development tools across all product Editions. MontaVista Graphics offers a rich GUI development tools platform.

Headquartered in the heart of Silicon Valley, in Sunnyvale, Calif., MontaVista Software is a privately held company funded by leading investors such as Alloy Ventures, China Development Industrial Bank, RRE Ventures, US Venture Partners, WR Hambrecht + Co., as well as IBM, Infineon Ventures, Intel Capital, Panasonic (Matsushita), Samsung Ventures America, Siemens Venture Capital, Sony, Toshiba America and Yamaha Corporation.

About Siemens Venture Capital

Siemens Venture Capital (SVC) is the corporate venture organization for all Siemens' businesses worldwide and plays a key role in the Siemens global network of innovation. The goal is to identify and fund investments in emerging and innovative technologies that will enhance the core business scope of Siemens.

The investment focus is to augment the efforts of various Siemens business segments such as Information and Communications, Automation and Control, Medical Solutions, Transportation Systems and Power. To that end, SVC invests in the following technology growth areas:

-- Wireline and wireless communication

-- Industrial automation solutions

-- Healthcare solutions and medical diagnostics

-- Automotive and networked transportation systems

-- Energy management

To date, SVC has invested some 500 million euros in more than 70 start-up companies and 30 venture capital funds mainly in the U.S., Europe and Israel. SVC is located in Germany (Munich) and in the U.S. (San Jose, CA and Boston, MA). For more information please visit our Web site: [HYPERLINK@www.siemensventurecapital.com.]

About Samsung Ventures America

Samsung Ventures America manages US investment and investment-related activities for Samsung Electronics and Samsung Venture Investment Corporation from local offices in San Jose. The investment mandate for Samsung Ventures America tracks closely to the strategic priorities of Samsung Electronics' core operating divisions, and encompasses investments in semiconductors, displays, telecommunications, and consumer electronics. Samsung Ventures America is currently actively investing in leading technology companies from a $300 million fund.

About Infineon Technologies

Infineon Technologies AG, Munich, Germany, offers semiconductor and system solutions for the automotive and industrial sectors, for applications in the wired communications markets, secure mobile solutions as well as memory products. With a global presence, Infineon operates in the US from San Jose, CA, in the Asia-Pacific region from Singapore and in Japan from Tokyo. In fiscal year 2003 (ending September), the company achieved sales of Euro 6.15 billion with about 32,300 employees worldwide. The company is ranked as the world's seventh largest semiconductor manufacturer in 2003. Infineon's U.S. sales grew by 39 percent to $1.6 billion in fiscal year 2003 compared to the previous fiscal year. Infineon's commitment to North America is backed by an expanding presence in the United States, where its subsidiaries employ a total of nearly 2,800 people. Infineon recently opened an Eastern U.S. business operations center in North Carolina, and now has seven development centers and operational offices, with locations in San Jose, California; Williston, Vermont; Cary, North Carolina; the Hudson River Valley Corridor of New York; Longmont, Colorado, Morgan Hill, California.

Infineon is listed on the DAX index of the Frankfurt Stock Exchange and on the New York Stock Exchange (ticker symbol:IFX). Further information is available at [HYPERLINK@www.infineon.com.]

About China Development Industrial Bank

China Development Industrial Bank (CDIB) is a full-service financial group and the premiere financial institution of Taiwan. For more than 40 years, CDIB has continuously supported Taiwan's economic development policies, actively playing a forward-looking and pioneering role by contributing to the nation's economic and industrial development. CDIB has also teamed with overseas enterprises to form a global financial and investment network, with offices in the United States, Israel, the United Kingdom, Japan, Korea, Australia, Thailand and the Philippines. The bank reported a net income of NT$7.5 billion for the fiscal year 2002, on revenue of NT$15 billion. CDIB was recently ranked the #1 bank in Taiwan in terms of profitability by Common Wealth magazine. For more information about the China Development Industrial Bank, go to [HYPERLINK@www.cdibank.com.]

Linux is a registered trademark of Linus Torvalds. MontaVista and DevRocket are trademarks or registered trademarks of MontaVista Software, Inc. All other names mentioned are trademarks, registered trademarks or service marks of their respective owners.