- The Washington Times - Thursday, February 20, 2003

SANTA CLARA, Calif., Feb. 20 (UPI) — Shares of National Semiconductor Corp. gained almost 7 percent Thursday after the chipmaker announced job cuts and plans to sell two business units.

Based in Santa Clara, Calif., National intends to eliminate 500 jobs and sell its Information Appliance unit and a cellular chip unit.

"These businesses have an excellent future. But at this point, to achieve that future requires more capital than we are prepared to invest," said Brian L. Halla, National's chairman, president and chief executive officer.

Also, the company has entered into a new long-term technology and manufacturing agreement with Taiwan Semiconductor Manufacturing Corp.

Taiwan Semiconductor is the world's largest contract manufacturer of semiconductors for other companies. The agreement establishes Taiwan Semiconductor as National's supplier of wafers for products with feature sizes at and below 0/15-micron.

"These are strategic actions specifically aimed at improving National's performance and providing faster returns to our shareholders," Halla said.

The company said it will take a $35 million to $45 million charge during its current, third quarter that ends Sunday. National expects to save $15 million per quarter beginning in its fourth quarter.

National will report its fiscal year third quarter earnings on March 6. Analysts surveyed by Thomson Financial/First Call expect the company to report a loss of 3 cents a share compared to a loss of 21 cents a share in the third quarter of last fiscal year.

National shares gained 97 cents, or 6.75 percent, to close Thursday at $15.35 on heavy volume of 3.5 million shares traded on the New York Stock Exchange.

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