CONEXANT acquires video compression business from GLOBESPANVIRATA

NEWPORT BEACH, Calif., June 25, 2002 - Conexant Systems, Inc. (Nasdaq: CNXT), a worldwide leader in semiconductor system solutions for communications applications, today announced that Conexant has acquired GlobespanVirata’s video compression business for approximately $21 million in cash and 1.25 million shares of Conexant stock, along with additional contingent payments to be made by Conexant to GlobespanVirata based on the future performance of both the video business and Conexant’s stock.

The acquisition will enable Conexant to accelerate development of Moving Picture Experts Group (MPEG) video products for fast-growing encoder markets including personal computers (PCs) and cable set-top boxes. The technology is also ideally suited for emerging applications such as writeable digital video disk recorders (DVDs), interactive gaming consoles, and digital personal video recorders (PVRs), which are expected to experience high levels of growth in the next few years. These applications will be incorporated into multimedia PCs and available as standalone appliances.

“This strategic acquisition enhances our portfolio by adding advanced digital media compression technologies that are critical to our long-term product roadmap in digital video markets and are synergistic with our current product offerings in the PC and set-top box markets,” said F. Matthew Rhodes, president of Conexant’s Broadband Communications Segment. “The MPEG compression group has proven capabilities in bringing innovative solutions to market, and the addition of this team will further strengthen our ability to quickly deliver leading-edge video processing products.”

“We are pleased that the GlobespanVirata MPEG compression team has joined Conexant,” said Dan Marotta, chief operating officer of Conexant’s Broadband Communications Segment. “They developed world-class technology and occupy an industry-leading position in the fast-growing market for complementary MPEG encoding solutions. Combining these capabilities with Conexant’s solid heritage in providing innovative mixed-signal video encoding and decoding products will allow us to offer unparalleled, end-to-end video processing system solutions across a wide range of applications.”

The 45-person MPEG compression team that joined Conexant will continue to be located in San Jose, Calif. Further details and terms of the transaction were not announced.

About Video Processing

There are two major functions and four key pieces to a complete convergence video-processing solution. The first function is the signal conversion between raw, uncompressed video and a machine-readable bitstream. This is accomplished with an analog video decoder. This process is also performed in reverse for applications where digital content must be converted for display on a TV monitor. A video encoder performs this function. Conexant’s current product offering includes both of these devices.

The second piece is a compression and decompression function that is critical to storing and transmitting digital data using the least amount of bandwidth possible. This is accomplished through an MPEG decoder (part of Conexant’s current product offering) and an MPEG encoder (acquired through GlobespanVirata).

About MPEG

MPEG is a set of international digital video and audio compression standards and file formats developed by Moving Pictures Experts Group. There are three major MPEG standards: MPEG-1, MPEG-2 and MPEG-4. MPEG is one of the enabling technologies for broadband media delivery.

MPEG-1 produces video quality slightly below the quality of conventional VHS videos. MPEG-2 offers a higher resolution with full CD-quality audio, and is the compression standard of choice for PCs. MPEG-4 is the next-generation digital video compression standard. It provides lower bit-rates for various quality levels, enabling content developers to create sophisticated programs containing audio, video, text, graphics and interactivity. As set-top box manufacturers begin to incorporate MPEG encoding, MPEG-4 is expected to become the compression standard of choice.

About Conexant

Conexant Systems, Inc. is a worldwide leader in semiconductor system solutions for communications applications. Conexant leverages its expertise in mixed-signal processing to deliver integrated systems and semiconductor products through three separate businesses that address the wireless communications, broadband access and Internet infrastructure markets. Conexant’s wireless communications business is focused on providing power amplifiers, radio-frequency subsystems and complete systems solutions. The broadband access business develops and delivers integrated solutions that enable digital entertainment and information networks for the home and small office. Mindspeed Technologies, the company’s Internet infrastructure business, designs, develops and sells a complete portfolio of semiconductor networking solutions that facilitate the aggregation, transmission and switching of data, video and voice from the edge of the Internet to linked metropolitan area networks and long-haul networks. Conexant, headquartered in Newport Beach, Calif., delivered revenues of $1.1 billion for fiscal 2001. The company is a member of the Nasdaq-100. To learn more, visit us at www.conexant.com or www.mindspeed.com.