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Material | September 12, 2006

Emcore Completes Sale<br>of Electronic Materials Division

Emcore Corporation announced that it has completed the sale of the Company's Electronic Materials & Device division (EMD) to a wholly owned subsidiary of IQE, plc (IQE) as previously announced on July 19, 2006.
IQE, headquartered in Cardiff, Wales with United States operations in Bethlehem, Pa., purchased certain of the assets including inventory, fixed assets, and intellectual property of EMD for a total transaction value of $16 million. The Company received $13 million at closing and $3 million in the form of a secured promissory note of IQE that will be repaid in four quarterly installments and bears interest at an annual rate of 7.5%. The Company anticipates a gain on the disposition in the range of $9 to $11 million.

IQE was formed in May 1999 by the merger of two epitaxial wafer companies supplying electronic and optoelectronic materials produced using MOCVD (metal organic chemical vapor deposition) and MBE (molecular beam epitaxy) equipment platforms. EMD utilizes MOCVD technology developed by EMCORE to produce both GaAs and GaN based transistor wafers for use in power amplifiers and switches in GSM, CDMA multiband wireless handsets, Wi-MAX, Wi-Fi, cellular handsets, and in wireless LAN applications.

IQE will continue to operate EMD in the Somerset, NJ facility. All 56 employees of EMD have been transferred to IQE.

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