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HP Awarded $236 Million Global IT Services Contract from Avago Technologies


PALO ALTO, Calif., April 12, 2006, Avago Technologies has awarded HP a $236 million services contract to provide global information technology services and operations management.

Under the terms of the 10-year agreement, Avago has selected HP for IT outsourcing that includes application, server, network, desktop and print management as well as IT help desk services.

Avago Technologies is the largest privately held semiconductor company in the world, supplying a wide range of analog, mixed-signal and optoelectronic components and subsystems to thousands of manufacturers globally. It became an independent company last year when it was acquired by Kohlberg Kravis Roberts and Silver Lake Partners.

As part of the agreement, HP will help transform Avago’s IT infrastructure and applications into a flexible, scalable environment, while reducing Avago’s IT costs. The service-based model reflects HP’s Adaptive Enterprise strategy, in which IT can support and enable business objectives and in which companies are able to more rapidly capitalize on changes in market conditions.

“With HP’s partnership, we designed a strategic outsourcing solution that will enable us to become agile and cost competitive,” said Eugene Lau, chief information officer, Avago Technologies. “This, along with their ability to support our aggressive timeline to build our independent Avago IT capabilities by late summer 2006, set HP apart from other suppliers.”

Over the coming months, HP will put in place a new IT applications and infrastructure capability for Avago, tuned to the company’s specific business requirements. A key part of this environment will be the applications landscape, where HP will partner with Oracle Consulting and Satyam Computer Services Ltd. to implement and support the Oracle E-Business Suite of enterprise applications. This environment, optimized across all of the company’s IT infrastructure elements, will allow Avago to simplify and streamline its key business processes to maximize their effectiveness.

HP also will manage and support the IT infrastructure for Avago, including servers and storage, local and wide area voice and data networks, hardware procurement and asset management. To increase end-user collaboration and maximize the workforce productivity of its 6,500 employees, Avago will use HP’s End-User Workplace Solutions portfolio, which includes desktop, imaging and printing, messaging and collaboration and service desk solutions.

Finally, Avago will take advantage of HP’s leasing and financial asset management services to simplify IT lifecycle management, reduce risk and increase the return on the company’s IT investment.

HP will predominantly support the new IT applications and infrastructure services from its global delivery centers in the Asia Pacific region, specifically India, Malaysia and Singapore, where a high percentage of Avago’s workforce and operations reside.

“By streamlining Avago’s IT, we are helping them cut costs, become more flexible and scalable, and ultimately gain competitive advantage,” said Marc Schwarz, senior vice president, Managed Services, HP. “Our relationship is an excellent example of how businesses can obtain substantial value by partnering with HP for all of their IT services needs.”

About HP

HP is a technology solutions provider to consumers, businesses and institutions globally. The company’s offerings span IT infrastructure, global services, business and home computing, and imaging and printing. For the four fiscal quarters ended Jan. 31, 2006, HP revenue totaled $87.9 billion. More information about HP (NYSE, Nasdaq: HPQ) is available at

This news release contains forward-looking statements that involve risks, uncertainties and assumptions. If such risks or uncertainties materialize or such assumptions prove incorrect, the results of HP and its consolidated subsidiaries could differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to anticipated operational and financial results; statements of expectation or belief; and any statement of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the achievement of expected results and other risks that are described from time to time in HP’s Securities and Exchange Commission reports, including but not limited to the risks described in HP’s Quarterly Report on Form 10-Q for the fiscal quarter ended Jan. 31, 2006, and other reports filed after HP’s Annual Report on Form 10-K for the fiscal year ended Oct. 31, 2005. HP assumes no obligation and does not intend to update these forward-looking statements.


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