ALLAN P. ADDURUBBH/BSA/4thyear

Product Extension MergersA product extension merger takes place between two business organizations that deal in products that are related to each other and operate in the same market. The product extension merger allows the merging companies to group together their products and get access to a bigger set of consumers. This ensures that they earn higher profits.ExampleThe acquisition of Mobilink Telecom Inc. by Broadcom is a proper example of product extension merger. Broadcom deals in the manufacturing Bluetooth personal area network hardware systems and chips for IEEE 802.11b wireless LAN.Mobilink Telecom Inc. deals in the manufacturing of product designs meant for handsets that are equipped with the Global System for Mobile Communications technology. It is also in the process of being certified to produce wireless networking chips that have high speed and General Packet Radio Service technology. It is expected that the products of Mobilink Telecom Inc. would be complementing the wireless products of Broadcom.Broadcom Completes Acquisition of Mobilink TelecomIRVINE, Calif. and SANTA CLARA, Calif., May 29, 2002 /PRNewswire-FirstCall via COMTEX/ -- Broadcom Corporation (Nasdaq: BRCM), the leading provider of integrated circuits enabling broadband communications, today announced that it has completed the acquisition of Santa Clara-based Mobilink Telecom, Inc.Mobilink is a leading supplier of chipsets and reference designs for use in cellular phones, cellular modem cards and wireless PDAs. Its products are currently in production and being used by major manufacturers of devices designed for the Global System for Mobile Communications (GSM), the world's most prevalent mobile phone standard.In addition, Mobilink is completing field-testing and certification of its General Packet Radio Service (GPRS) products, targeted to a market that will deliver Internet Protocol packet services to over 650 million GSM subscribers.In connection with the acquisition, Broadcom issued or reserved for future issuance an aggregate of 5,608,662 shares of its Class A common stock in exchange for all outstanding shares of Mobilink's preferred and common stock and upon exercise of outstanding employee stock options and other rights of Mobilink. If certain internal performance goals are satisfied, certain shareholders and option holders of Mobilink will receive up to 2,045,569 additional shares of Broadcom Class A common stock. The share issuances were exempt from registration pursuant to section 3(a)(10) of the Securities Act of 1933, as amended. A portion of the shares issued will be held in escrow pursuant to the terms of the acquisition agreement.The merger transaction will be accounted for under the purchase method of accounting. Broadcom expects to record a one-time charge for purchased in-process research and development expenses related to the acquisition in its second fiscal quarter, ending June 30, 2002. The amount of that charge has not yet been determined.About BroadcomBroadcom Corporation is the leading provider of highly integrated silicon solutions that enable broadband communications and networking of voice, video and data services. Using proprietary technologies and advanced design methodologies, Broadcom designs, develops and supplies complete system-on-a-chip solutions and related hardware and software applications for every major broadband communications market. Our diverse product portfolio includes solutions for digital cable and satellite set-top boxes; cable and DSL modems and residential gateways; high-speed transmission and switching for local, metropolitan and wide area networking; home and wireless networking; cellular and terrestrial wireless communications; Voice over Internet Protocol (VoIP) gateway and telephony systems; broadband network processors; and SystemI/O server solutions. These technologies and products support our core mission: Connecting everything.Broadcom is headquartered in Irvine, Calif., and may be contacted at 1-949-450-8700 or at www.broadcom.com .Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:All statements made or incorporated by reference in this release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "potential," "continue," similar expressions, and variations or negatives of these words. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. These forward-looking statements speak only as of the date hereof and are based upon the information available to us at this time. Such information is subject to change, and we will not necessarily inform you of such changes. These statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors.Important factors that may cause such a difference for Broadcom in connection with the acquisition of Mobilink Telecom, Inc. include, but are not limited to, the risks inherent in acquisitions of technologies and businesses, including the timing and successful completion of technology and product development through volume production, integration issues, costs and unanticipated expenditures, changing relationships with customers, suppliers and strategic partners, potential contractual, intellectual property or employment issues, accounting treatment and charges, and the risks that the anticipated benefits of the acquisition are not realized; general economic and political conditions and specific conditions in the markets we address, including the recent significant economic slowdown in the technology sector and semiconductor industry; the rate at which present and future customers and end-users adopt Broadcom's technologies and products in the markets for GSM and GPRS mobile telecommunications and other wireless products; delays in the adoption and acceptance of industry standards in those markets; the timing of customer-industry qualification and certification of our products and the risks of non-qualification or non-certification; the timing, rescheduling or cancellation of significant customer orders and the ability of customers to manage their inventories; the loss of a key customer; the volume of product sales and pricing concessions on volume sales; the effectiveness of our expense and product cost control and reduction efforts; changes in our product or customer mix; the qualification, availability and pricing of competing products and technologies and the resulting effects on sales and pricing of our products; the effects of new and emerging technologies; our ability to specify, develop or acquire, complete, introduce, market and transition to volume production new products and technologies in a timely manner; our ability to retain and hire key executives, technical personnel and other employees in the numbers, with the capabilities, and at the compensation levels needed to implement our business and product plans; intellectual property disputes and customer indemnification claims and other types of litigation risk; the availability and pricing of third party semiconductor foundry and assembly capacity and raw materials; fluctuations in the manufacturing yields of our third party semiconductor foundries and other problems or delays in the fabrication, assembly, testing or delivery of our products; the risks of producing products with new suppliers and at new fabrication and assembly facilities; problems or delays that we may face in shifting products to smaller geometry process technologies and in achieving higher levels of design integration; the quality of our products and any remediation costs; the risks and uncertainties associated with international operations, particularly in light of recent events; the effects of natural disasters, international conflicts and other events beyond our control; the level of orders received that can be shipped in a fiscal quarter; and other factors.Our Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other Securities and Exchange Commission filings discuss some of the important risk factors that could contribute to such differences or otherwise affect our business, results of operations and financial condition. We undertake no obligation to revise or update publicly any forward-looking statement for any reason.Broadcom, the pulse logo, Connecting everything, Mobilink and SystemI/O are trademarks of Broadcom Corporation and/or its affiliates in the United States and certain other countries. All other trademarks mentioned are the property of their respective owners.

ALLAN P. ADDURUBBH/BSA/4th yearMERGER AND ACQUISITIONADVANTAGE It provides a business with a potentially bigger market share and it opens the business up to a more diversified market. Makes a business bigger, increase its production and gives more financial strength to become stronger against the competitor on the same market. The most common reason for firms to enter into merger and acquisition is to merge their power and control over market. leads in over all cost reduction giving a competitive advantage that is feasible as a result of raised buying power and longer production run.DISADVANTAGE Merger may result to loss of experienced workers aside from workers in leadership positions. Merging two firms that are doing similar activities may mean duplication and over capability within the company that may need retrenchment. Merger can reduce competition and give new firm monopoly power with less competition and greater market share the new firm can usually increase prices for consumers.BROADCOM AND MOBILINK TELECOM MOBILINK TELECOM A Leading Provider of Chipsets and Manufacturing-Ready Reference Designs for Cellular Phones, Wireless PDAs and Cellular Modem Cards. BROADCOM CORPORATION The leading provider of intergrated circuits. REASON FOR ACQUISITION Broadcom to Provide Complete Solutions for Wireless Wide, Local and Personal Area networkProduct Extension MergersA product extension merger takes place between two business organizations that deal in products that are related to each other and operate in the same market. The product extension merger allows the merging companies to group together their products and get access to a bigger set of consumers. This ensures that they earn higher profits.TERMS OF ACQUISITIONS In connection with the acquisition, Broadcom will issue approximately 5.6 million shares of its Class A common stock in exchange for all outstanding shares of Mobilink capital stock and upon exercise of outstanding employee stock options and other rights of Mobilink. Up to approximately 2.0 million additional shares of Broadcom Class A common stock will be reserved for future issuance to the shareholders and option holders of Mobilink upon satisfaction of certain performance goals. Acquisition Marks Broadcom's Entry into the $11 Billion-Plus CellularMOBILINK TELECOM Mobilink's products are currently in production and being used by major manufacturers of devices designed for the Global System for Mobile Communications (GSM), the world's most prevalent mobile phone standard.Mobilink is completing field-testing and certification of its General Packet Radio Service (GPRS) products, targeted to a market that delivers Internet Protocol packet services to over 650 million GSM subscribers. Mobilink's product offering includes an all-CMOS single-chip baseband processor, protocol stacks, and MMI (Man-Machine Interface) and application software, as well as customized final product designs tailored to its customers' specifications.BROADCOM Broadcom Corporation is the leading provider of highly integrated silicon solutions that enable broadband communications and networking of voice, video and data services. Using proprietary technologies and advanced design methodologies, Broadcom designs, develops and supplies complete system-on-a-chip solutions and related hardware and software applications for every major broadband communications market. Broadcom has already introduced a number of leading products enabling 802.11b and Bluetooth networks. The addition of Mobilink's GSM/GPRS integrated circuits, software and design capabilities will further enable Broadcom to support the convergence of wireless networks, allowing delivery of high bandwidth content to users virtually anytime, anywhere, and driving the transformation of the handset from a voice-only device into a multimedia gateway. With its broad product portfolio and access to every major broadband communications market, Broadcom is an ideal complement for Mobilink's growing reach into the mobile segment. Broadcom's acquisition of Mobilink is a significant validation of the technology, products and team in which Ericsson first invested in 2001. Important factors that may cause such a difference for Broadcom in connection with its acquisition of Mobilink Telecom, Inc. include, but are not limited to, TSShe risks inherent in acquisitions of technologies and businesses, including the timing and successful completion of technology and product development through volume of production. Integration issues, costs and unanticipated expenditures, changing relationships with customers, suppliers and strategic partners, potential contractual, intellectual property or employment issues, accounting treatment and charges. "Broadcom's entry into the cellular chip, design and software markets through the acquisition of Mobilink represents an important strategic step for our company, one that will not only allow us to provide wide area roaming capability over the digital cellular networks, but also enhance synergies with our best-in-class products for enterprise 802.11b wireless networks and short range wireless links over Bluetooth(TM) connections,-Dr. Henry T. Nicholas III, Broadcom's President and CEO.