Isola Undertakes Strategic Repositioning To Maximize Manufacturing Efficiencies

CHANDLER, ARIZONA, May 31, 2005 Isola Group today announced a plan to further reposition and maximize its global footprint to better meet the needs of their customer base. Isola will move product produced in their Philippines factory to Suzhou, China and the recently expanded Taoyuan Hsien, Taiwan facility. The company is also in the planning process of multi million dollar upgrade of the Singapore operations. Commenting on investment in Asia, Eric Seip, VP Global Operations stated the $4 million pressing and build up line expansion just completed in Taiwan provides Isola with additional capacity in FR4 products with an emphasis on multilayer products. This combined with the planned Singapore facility upgrade makes phasing out the Philippines plant over the next two months an operationally seamless process.

During the past 12 months, in addition to Asia, Isola has completed restructuring activities in Europe and at its headquarters in Chandler, Arizona. Investment programs include a new bromination plant in Germany and completion of the Quick Turn Around plant in Fremont, CA with a $2 million expansion focused on R&D and production capabilities. According to Ray Sharpe, CEO at Isola, The completion of our expansion in Taiwan, Germany, Chandler and Fremont was an important first step. Our focus now is to simplify operations by concentrating our production at locations where the customers are, allowing us to provide advanced products in Asia ahead of our competition. The improved footprint increases leverage with our supply base to service all our customers better. The new phase of investment also allows Isola to maximize customer efficiencies with a regional R&D and Technology Center located in Taiwan.

In addition to the Singapore upgrade, additional expansion plans include a new South China facility to be operational within the next 12-18 months. This plant when commissioned will receive most of the equipment in the current Philippines operation.

31 May 2005

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