** Reproduced from The Ottawa Business Journal Online September 13, 2002

Performance Tech buys Intel operation for US$3.8M
By Leo Valiquette, Ottawa Business Journal

Performance Technologies bought part of Intel Corp.'s embedded chip business on Thursday, a deal that doubles its portfolio of products and customer base.

The Rochester, New York-based company, with about 40 staff in Ottawa, will pay US$3.8 million in cash for part of Intel's embedded Communications Platform Division based in San Luis Obispo, Calif.

The operation will continue to operate out of San Luis Obispo, with its products branded under the Ziatech name. The deal is expected to close by Oct. 1.

Director of marketing Ed Bizari said the acquisition will immediately be accretive to earnings.

The combined product offering of the two companies will be aimed at the data communications, telecommunications, military, industrial automation, transportation and medical markets. The new unit will also focus on developing packet-based products for the Internet Protocol networks.

While the Performance's embedded business is based largely out of Rochester, Bizari said, one of the products developed in Ottawa will figure in the new product portfolio.

Ottawa is an engineering centre for the company's other division, signaling systems. The division develops Ethernet switching and network access products.

Bizari said Ottawa develops "valuable technology for us” adding that success in one part of the company benefits "all parts of the company.”

That assurance comes despite the fact that Performance laid of six local workers earlier this week as part of 13 layoffs across the company.

He declined to say how the acquisition will directly impact Performance's revenue guidance or the specific prospects for the Ottawa operation. Further details will be made available through a conference call on Monday with CFO Dorrance W. Lamb.

The call will take place at 10 a.m. at 1-888-701-8678. The conference ID number is 5683024.