Ayutthaya, Thailand, November 22, 2004 - KR Precision Plc (KRP), a Stock Exchange of Thailand-listed manufacturer of disk-drive suspensions has entered into a Share Sale and Purchase Agreement with Singapore Exchange-listed Magnecomp International Ltd (MIL) to purchase 100 per cent of MIL's data storage businesses.

Upon the completion of the proposed transaction early next year, KRP and MIL will merge their data storage component operations with MIL owning approximately 80% per cent of the enlarged issue share capital. The proposed transaction must be approved by current KRP and MIL shareholders. MIL must also undertake a tender offer to buy 100 per cent of the company's shares from KRP's existing shareholders.

KRP designs, develops, manufactures and markets suspension assemblies and precision metal components for the hard-disk drive and consumer electronics industries. MIL operates a similar business.

For the nine-months ending September 2004, KRP's revenues were Bt788 million while MIL's nine-months’ revenues ending September 2004 were Bt3.77 billion. As a result of the proposed merger, the number of major global players in the disk-drive suspension manufacturing business will be reduced to three major companies, one each headquartered in the USA, Japan, and Thailand.

To complete the transaction, KRP will be increasing its existing capital by approximately 1.4 billion shares. These new shares will be used as consideration for MIL's Data Storage Component Division business that will be transferred to KRP.

The proposed merger's synergies will bring major benefits to both companies. KRP will immediately realize an increase in business from incumbent MIL customers, and MIL will broaden its customer base through KRP's established relationships.

The combined entity will generate higher top-line revenue from a broadened diversified product portfolio. The result will be a significantly stronger company because it will present a greater value-proposition to the industry, with diversified manufacturing facilities in Thailand and China, strongly supported by extensive Research and Development facilities in Thailand and the US.

Another key synergy derived from the proposed merger includes more strategic supply-chain alignment together with vertical integration by each company of certain key components. This supply chain integration initiatives and a more diversified customer base will allow the new company to better withstand the periodic industry business cycles.

Currently, KRP's customers include four of the largest hard-disk drive manufacturers in the world, two recording head manufacturers and emerging customers in consumer electronics and HDD components.

MIL's data storage manufacturing activities are currently based in China and Thailand. The company's US subsidiary Magnecomp Corporation is their principle Research and Development center, providing advanced design support and leading time to market prototype manufacturing. Together with KR’s current research and development activities in Thailand, the Company will enhance its global reach in providing customers advanced solutions.

This transaction is independent of the legal dispute between KRP and MIL and did not arise with the intention of extinguishing the legal dispute, nor was it ordered as part of a resolution of the legal dispute. 

Headquartered in Ayutthaya, Thailand, KR Precision is a world leader in the design and manufacturing of suspension assemblies for hard disk drives and in the manufacturing of precision metal components. KR Precision counts among its customers many of the world’s largest and most well known hard disk drive producers. For more information, please visit the KR Precision website at www.krprecision.com .

Forward Looking Statement

This release contains forward-looking statements that involve risks, uncertainties and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. The forward-looking statements are based on current management expectations, and actual results may differ materially as a result of several factors, including: levels of operating expense and product cost; supply and demand conditions in the data storage industry; overall economic conditions; changes in product and customer mix; pricing trends; actions by competitors; the pace of development of new markets; successful entry into new markets by the Company; and other factors discussed in periodic reports filed with the SET. We undertake no obligation to update or alter our forward-looking statements to reflect new information or events or for any other reason.

ENDS