Toshiba Corporation (Toshiba), Sony Corporation (Sony), and Sony Computer Entertainment Inc. (SCEI) today announced that they have signed a definitive agreement to form a new joint venture among the companies for the production of high-performance semiconductors, including products for SCEI's PlayStation computer entertainment systems. Toshiba, Sony and SCEI started discussing the possibility of entering into a joint venture last year, and today's agreement follows an October 18, 2007 memorandum of understanding between the parties.

Under the terms of the definitive agreement, the joint venture, to be named at a later date, will start operation from April 1, 2008 in Nagasaki Technology Center of Sony Semiconductor Kyushu Corporation (SCK). It will be 60% owned by Toshiba, and Sony and SCEI will each take a 20% stake. Within the fiscal year ending March 31, 2008, Toshiba will acquire from Sony and SCK for approximately 90 billion yen, the 300mm wafer line installed in SCK's Nagasaki Technology Center Fab2, with the exception of some equipment, and plans to loan it to the joint venture at the start of operation. Details of the operation including administrative and operation organization will be finalized by the start-up date.

Semiconductors to be manufactured by the joint venture include the "Cell Broadband EngineTM" (Cell/B.E.) processor, the "RSX" graphics engine and other high-performance semiconductors for Sony Group, as well as Toshiba's leading edge SoCs (System on Chip) for applications in digital consumer products. Manufacturing will start with 65nm process, and the joint venture will promote migration to 45nm process mass production, in cooperation with Toshiba's system LSI manufacturing operation in Oita, while also working to achieve advances in manufacturing technologies and efficiencies.

Outline of Joint Venture

• Company name: To be determined (at a later date)
• Start of Operation: April 1, 2008 (scheduled)
• Location: 6-30 Tsukuba-machi, Isahaya-city, Nagasaki, Japan
• Capitalization: 100 million yen
• Ownership: 60% Toshiba, 20% Sony, 20% SCEI
• Representation: To be determined (Chairman and CEO to be appointed by Toshiba, President and COO to be appointed by Sony)
• Business: Manufacture of high-performance semiconductors, including Cell/B.E., RSX graphic engine, and Toshiba's leading edge SoCs for applications in digital consumer products.