MUNICH, GERMANY -- Qimonda AG, a leading manufacturer of memory products, and Centrosolar Group AG, a leading German solar company, signed a contract to jointly build, equip and operate a solar cell manufacturing plant.

The joint venture will produce solar cells based on silicon and will be owned 49 percent by Centrosolar and 51 percent by Qimonda Solar GmbH, a 100 percent subsidiary of Qimonda AG. In the planned co-operation, Qimonda will contribute its existing know-how in silicon-based mass production as well as important access to silicon supply.

Centrosolar will contribute its expertise with solar systems and the sales and distribution of solar modules. The venture company, which will be located on Qimonda's existing site in Vila do Conde, Portugal is planned to initially invest Euro 70 million by September 2009.

"By entering the solar industry, we are addressing an attractive market with stable and high growth rates. We will leverage our core competencies in silicon-based, high-quality mass production to generate a new revenue stream for Qimonda," said Kin Wah Loh, President and Chief Executive Officer of Qimonda AG. "Together with our experienced solar partner Centrosolar we have developed a capital and resource efficient setup to start this promising new business."

Dr. Alexander Kirsch, Chairman of the Management Board of Centrosolar Group AG said: "Within the last years, Centrosolar has moved into a new dimension in regard to the size of the corporation and single projects. Therefore, it has become necessary to establish an own manufacturing brand for solar cells. With Qimonda as a partner, we are able to guarantee a competitive quality manufacturing of solar cells, which in the future will be produced inhouse and destined for our expanding module production sites in Germany and the Netherlands."

Subject to approval by the relevant authorities, the commencement of fab construction at Qimonda's site in Vila do Conde, Portugal is scheduled for mid 2008. The facility is scheduled to be ready for equipment early in 2009 and to start production in the second half of 2009. The new facility is planned to have an initial capacity of up to 30 million solar cells per year (equivalent to about 100 MegaWatt peak) and employ approximately 150 employees. In addition, a silicon supply agreement with LDK Solar Co., Ltd., Xinyu City, China, has been concluded.