Cogo Announces Xilinx Partnership to Target China's High-Speed Railway Build-out

SHENZHEN, China, Sept. 22 /PRNewswire-FirstCall/ -- Cogo Group, Inc. (Nasdaq: COGO), a leading embedded solutions provider for the technology and industrial sectors in China, today announced a strategic partnership with Xilinx, a leading global provider of field programmable gate arrays ("FPGAs") in the semiconductor industry.  Initially, this strategic partnership will be focused on embedded signaling control functions within China's high-speed railway build-out.  

China is in the early stages of an aggressive High-Speed railway build-out across the country, with total High-Speed Railway lines that can support trains running at 350 km/hr (210 m.p.h) expected to grow from 2,000 km currently to 16,000 km in 2020. Cogo is currently engaged with a variety of railway providers, including China South Locomotive & Rolling Stock Corporation Limited ("CSR"), and Xilinx's highly technical product offerings will enable Cogo to drive solutions deeper into these key high-speed railway accounts.

Cogo recorded small amounts of revenue from the Xilinx partnership in the second quarter of 2010 and anticipates the business will accelerate through 2011 and 2012. In addition to High-Speed Railway solutions, Cogo expects to collaborate with Xilinx on a number of fast growing Industrial and Consumer verticals, including medical, LED, broadcasting, gaming and automotive.  Cogo plans to design customized solutions across its 1,500-strong customer base utilizing both the Virtex and Spartan product lines from Xilinx.  

Currently, Cogo is testing Xilinx solutions with over 100 customers within Cogo's sales channel.  Over time, Cogo expects that the addition of Xilinx and Intel to its solution line-up will be a key driver of its Small and Medium Enterprise ("SME") strategy.    

Earlier in 2010, China Electronic News named Xilinx, along with Broadcom and Freescale, as three of the top 10 most popular semiconductor brands in China. Cogo now works with all three of the leading global semiconductor franchises.

"We are extremely pleased to add Xilinx as a key design partner for Cogo as it opens up large new markets for our embedded system solutions and acts as a clear validation of our strong position in China," commented Jeffrey Kang, CEO of Cogo.  "Xilinx views our installed customer base of 1,500 customers as a clear competitive advantage and sees great value in both our dedicated marketing and engineering support as well as our strong design-in/design-win capabilities.  Overall, our sales pipeline continued to build nicely in the third quarter of 2010 providing us with strong visibility into solid growth in the back half of 2010 and into 2011, particularly in our digital media and industrial business units."

About Cogo Group, Inc.:

Cogo Group, Inc. (NASDAQ: COGO) is a leading provider of customized module and subsystem design solutions in China. The Company believes it acts as a proxy to China's technology industry as it works with virtually all the major ODMs and OEMs in China. Cogo leverages these relationships and combines their IP to create designs that Cogo then sells to electronic manufacturers. These designs allow manufacturers to reduce their time to market for new products and ultimately increase sales. Cogo focuses on the telecommunications equipment, digital media and industrial applications end-markets for their customized design modules while also offering business and engineering services to their large telecommunications equipment vendor customers. Over the last fifteen years, Cogo has grown its customer list to include nearly 1,500 manufacturers across the telecommunications equipment, digital media and industrial applications markets, covering both multinational Chinese subsidiaries and Chinese domestic companies.

About Xilinx, Inc.:

Xilinx, Inc. engages in the design, development, and marketing of programmable logic solutions. It offers advanced integrated circuits in the form of programmable logic devices (PLDs); software design tools to program the PLDs; predefined system functions as intellectual property (IP) cores; design services; customer training; and field engineering and technical support solutions. The PLDs include field programmable gate arrays and complex programmable logic devices, which customers program to perform desired logic functions. The company provides its solutions for electronic equipment manufacturers in end markets, such as wired and wireless communications, industrial, scientific and medical, aerospace and defense, audio, video and broadcast, consumer, automotive, and data processing. It also offers targeted design platforms comprising reference designs, target boards, application software, design tools, IP, and silicon; Xilinx ISE, a design suite that enables designers to target area, performance, or power, as well as integrates with third-party electronic design automation software offerings and point-tool solutions. In addition, the company provides IP components to meet timing parameters, as well as domain-specific IP; development boards, reference designs, kits, and configuration products; and an ecosystem of IP, boards, tools, services, and support. Further, it offers engineering and third-party alliance member services, such as training, full design creation, and implementation. It sells its products to original equipment manufacturers and electronic components distributors through independent domestic and foreign distributors, direct sales, network of independent sales representative firms, and a direct sales management organization in North America, the Asia Pacific, Europe, and Japan. The company was founded in 1984 and is headquartered in San Jose, California.

Safe Harbor Statement:

This press release includes certain statements that are not descriptions of historical facts, but are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include statements about our proposed discussions related to our business or growth strategy such as growth in industrial application businesses and businesses with Xilinx, Inc., Broadcom, Freescale, Intel and including China South Locomotive & Rolling Stock Corporation Limited which are subject to change. Such information is based upon expectations of our management that were reasonable when made, but may prove to be incorrect. All such assumptions are inherently subject to uncertainties and contingencies beyond our control and upon assumptions with respect to future business decisions, which are subject to change. For further descriptions of other risks and uncertainties, see our most recent Annual Report filed with the Securities and Exchange Commission (SEC) on Form 10-K, and our subsequent SEC filings. Copies of filings made with the SEC are available through the SEC's electronic data gathering analysis retrieval system (EDGAR) at www.sec.gov.

SOURCE Cogo Group, Inc.