Compound Semiconductor Catapult Centre announced

IQE plc

IQE and Cardiff University to help Spearhead the £50m UK Compound Semiconductor Catapult Centre

Cardiff, UK, 08 January 2016 - IQE plc (AIM: IQE; "IQE", the "Group") the leading manufacturer of advanced semiconductor wafer products to the global semiconductor industry and Cardiff University will help spearhead a new £50m UK national Catapult to develop and build next generation Compound Semiconductors (CS)

Announcing the £50m funding following a meeting in South Wales with IQE and Cardiff University, Chancellor George Osborne said the investment will create a new CS hub of excellence in South Wales as part of a UK network of Research and Development Catapults.

In a speech to Cardiff's business leaders, Chancellor George Osborne said:

"Wales is an innovative nation. The UK national centre in South Wales will develop compound semiconductors that are at the heart of modern technology. It will bring together scientists and businesses with expertise. It will create jobs and bring investment."

IQE and Cardiff University have already established the Compound Semiconductor Centre, which will form a key resource to the Catapult for the new Catapult. The partnership will help transform leading edge research at Cardiff University's new Institute for Compound Semiconductors (ICS) - to be built on the University's new £300m Innovation Campus - into 21st Century technologies and products.

Dr Drew Nelson, IQE CEO and President, said:

"The launch of the £50m catapult is fantastic news for high-level manufacturing in Wales and for the Welsh economy. The Compound Semiconductor Catapult will help provide the critical mass to launch the first Compound Semiconductor hub of its kind in the World, taking great academic research and seamlessly turning it into high-volume manufacturing, securing a global industrial and manufacturing platform for

Wales and the UK."

Professor Colin Riordan, Vice-Chancellor Cardiff University, said:

"The announcement is excellent news for innovation, industry and enterprise in South Wales and beyond. It offers a real opportunity for Cardiff University and IQE to help establish Europe's first Compound Semiconductor cluster and create a world-class powerhouse to develop and commercialise next generation technologies."

Welsh Government Economy and Science Minister, Edwina Hart, welcomed the £50m investment.

"Compound semiconductors are the future key enabling technology driving advances across technologies including smart phones, energy, healthcare and transport. The funding will help create a compound semiconductor industry cluster of European scale and global reach in South Wales, and represents a real vote of confidence in Wales' universities, its semiconductor businesses and skills base."

In November, the Welsh Government announced a £12m funding package to support the construction, fit-out, and purchase of capital equipment for Cardiff University's Institute for Compound Semiconductors (ICS). The UK's Research Council Partnership Investment Fund has invested £17.3m to support the Institute.

Last year one of the world' s leading experts in CS technologies, Professor Diana Huffaker, was appointed to lead a new research laboratory at Cardiff University through the Welsh Government's £50m Sêr Cymru programme.

Announcement: https://www.gov.uk/government/news/50-million-for-innovation-centre-in-wales-pledged-by-chancellor

Contacts:

IQE plc +44 (0) 29 2083 9400

Dr Drew Nelson

Phil Rasmussen

Chris Meadows

Cardiff University + 44 (0) 2920 870917

Professor Colin RiordanHeath Jeffries

NOTE TO EDITORS

ABOUT IQE

www.iqep.com

IQE is the leading global supplier of advanced semiconductor wafers with products that cover a diverse range of applications, supported by an innovative outsourced foundry services portfolio that allows the Group to provide a 'one stop shop' for the wafer needs of the world's leading semiconductor manufacturers. IQE uses advanced crystal growth technology (epitaxy) to manufacture and supply bespoke semiconductor wafers ('epiwafers') to the major chip manufacturing companies, who then use these wafers to make the chips which form the key components of virtually all high technology systems. IQE is unique in being able to supply wafers using all of the leading crystal growth technology platforms.IQE's products are found in many leading-edge consumer, communication, computing and industrial applications, including a complete range of wafer products for the wireless industry, such as mobile handsets and wireless infrastructure, Wi-Fi, WiMAX, base stations, GPS, and satellite communications; and optical communications. The Group also manufactures advanced optoelectronic and photonic components such as semiconductor lasers, vertical cavity surface emitting lasers (VCSELs) and optical sensors for a wide range of applications including optical fibre communications, optical storage (CD, DVD, BluRay), thermal imaging, leading-edge medical products, pico-projection, finger navigation ultra-high brightness LEDs, and high efficiency concentrated photovoltaic (CPV) solar cells.The manufacturers of these chips are increasingly seeking to outsource wafer production to specialist foundries such as IQE in order to reduce overall wafer costs and accelerate time to market.IQE also provides bespoke R&D services to deliver customised materials for specific applications and offers specialist technical staff to manufacture to specification either at its own facilities or on the customer's own sites. The Group is also able to leverage its global purchasing volumes to reduce the cost of raw materials. In this way, IQE's outsourced services, provide compelling benefits in terms of flexibility and predictability of cost, thereby significantly reducing operating risk.IQE operates a number of manufacturing and R&D facilities across Europe, Asia and the USA. The Group also delivers its products and services through regional sales offices located in major economic centres worldwide