Creating a Leading Provider of Networked Home Entertainment Semiconductor Solutions.

Sigma Designs^®, Inc. (NASDAQ: SIGM) ("Sigma") and CopperGate Communications Ltd. ("CopperGate") today announced that the companies have entered into a definitive agreement for Sigma to acquire CopperGate in a cash and stock transaction with an agreed value of $160 million, net of CopperGate's cash at the closing of the transaction.

The combination of Sigma and CopperGate created a leading provider of networked home entertainment semiconductor solutions. The companies have highly complementary technology platforms that form a portfolio of end to end solutions. The transaction further strengthens Sigma's position and expands its footprint with key customers, in addition to enabling cross selling opportunities.

"CopperGate is extremely excited to be part of the Sigma team, which will bring together best-in-class product teams, technology, solutions and support to our customers to provide a larger scale of opportunities" said Gabi Hillevitz, CopperGate's Chief Executive Officer. "Both companies share a dedication to excellence in product innovation and have advanced the technology roadmaps in the IPTV market. We believe joining Sigma will allow us to increase our investments in next-generation products and leverage Sigma's manufacturing expertise and RF/Analog skill set".

The combination of Sigma and CopperGate is also expected to yield several potential synergies including synergies from leveraging manufacturing know-how and combined wafer sourcing, further SoC integration and combined research and development.

The estimated amount of cash to be paid by Sigma on the closing date is approximately $92 million plus the amount of cash and cash equivalents estimated to be held by CopperGate transaction expenses and debt outstanding at the closing. In addition, Sigma will issue shares of its common stock to CopperGate shareholders estimated at the time of signing to equal approximately 4.0 million shares.