DALSA Corporation

DALSA Corporation
Coreco Inc.

Coreco Inc.

February 16, 2005 17:44 ET

DALSA Corporation to Acquire Coreco Inc.


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: DALSA CORPORATION

TSX SYMBOL: DSA



AND CORECO INC.

TSX SYMBOL: CRC

FEBRUARY 16, 2005 - 17:44 ET

DALSA Corporation to Acquire Coreco Inc.

WATERLOO, ONTARIO and MONTREAL, QUEBEC--(CCNMatthews - Feb. 16, 2005) -
DALSA Corporation (TSX:DSA) and Coreco Inc. (TSX:CRC) today announced
that they have entered into an arrangement agreement, pursuant to which
DALSA will acquire all of the issued and outstanding shares of Coreco,
subject to certain conditions, including regulatory approvals. The
transaction will be completed by way of plan of arrangement. The
arrangement has the unanimous support of the board of directors of each
of DALSA and Coreco.

The transaction, which combines Coreco's industry leading vision
processors, software, and smart camera technology with DALSA's high
performance image sensor chips and digital cameras, will create a
company that is well positioned to lead the convergence of technologies
in the high performance digital imaging and machine vision marketplace.

Pursuant to the arrangement, shareholders of Coreco will receive for
each common share of Coreco, at their election (and subject to
pro-ration) either:

(a) 0.5207 of a DALSA common share;

(b) $10.00 in cash; or

(C) a combination of cash and DALSA common shares,

subject to a maximum of $35 million in cash available for election. The
total consideration paid by DALSA for Coreco is approximately $72
million. The purchase price of $10.00 per Coreco share represents a
57.5% premium to the 90 day average trading price of the common shares
of Coreco.

An information circular detailing the arrangement is anticipated to be
mailed to shareholders of Coreco in late March with a shareholder
meeting to be held in late April. The arrangement will require the
approval of 66 2/3% of the votes cast by Coreco shareholders at the
Coreco shareholder meeting, as well as the approval of the Superior
Court of Quebec and other regulatory agencies. Keith Reuben, President
and CEO of Coreco; Robert Mee, Chairman of the Board of Coreco; and
Daniel Crevier, founder of Coreco, who together hold approximately 11%
of the outstanding Coreco common shares, have executed agreements
pursuant to which they have agreed to vote their shares in favour of the
arrangement.

The board of directors of Coreco formed a special committee consisting
of three independent directors, Robert Mee, Daniel Crevier and Jacques
Lefebvre, to make a recommendation to the board on the transaction. The
special committee retained RBC Capital Markets to act as its financial
advisor. RBC Capital Markets has provided an opinion to the special
committee that the consideration offered pursuant to the arrangement is
fair, from a financial point of view, to the Coreco shareholders. The
special committee unanimously recommended that Coreco's board of
directors approve the arrangement and recommend to shareholders that
they vote in favour of the arrangement. The board of directors of Coreco
has unanimously determined that the arrangement is in the best of
interests of Coreco and its shareholders and unanimously recommends that
shareholders accept and vote in favour of the proposed arrangement.

The transaction is expected to close in late April and be accretive to
earnings to DALSA in 2005. CIBC World Markets Inc. acted as financial
advisor to DALSA for the transaction.

"Today's agreement combines two Canadian companies with excellent
fundamentals, solid management and strong technology," commented Savvas
Chamberlain, CEO of DALSA Corporation. "I am particularly excited about
the opportunity for the 'new DALSA' to take a leadership role in the
convergence of technologies that is rapidly occurring in our industry.
By combining Coreco's vision processing and software expertise with
DALSA's CCD and CMOS image sensor technology we have the unique
opportunity to develop innovative and high-value products that will
allow us to compete even more successfully worldwide. Furthermore, I am
pleased that our corporate cultures are so similar. This will accelerate
integration, while minimizing disruption of both companies' existing
businesses."

"This agreement fulfills Coreco's long-stated strategy of gaining access
to sensor technology and furthering our capabilities for smart cameras,"
added Keith Reuben, President & CEO, Coreco Inc. "In the short-term,
both companies will benefit from matching Coreco's products with DALSA's
image sensor and camera technology to address specific needs in flat
panel display inspection, an expanding end market in which both
companies are particularly strong. Longer-term, the opportunities to
collaborate are equally significant and will enhance the overall
competitiveness of the combined business." Mr. Reuben will join DALSA as
President of "DALSA Coreco", reporting to Savvas Chamberlain, CEO of
DALSA Corporation.

Investor Conference Call and Webcast

A conference call and webcast with presentation slides will be held
Thursday, February 17, at 8:30am ET. The webcast presentation will be
broadcast live and open to anyone. It can be accessed at
http://events.onlinebroadcasting.com/dalsa/021705/index.php.The phone
numbers for those who wish to participate in the question and answer
period following the presentation are as follows:

Live Conference Access information:

Local Access: 416-695-9707

Toll-Free Access: 1-888-334-9269

About DALSA Corporation

DALSA is an international high performance semiconductor and electronics
company that designs, develops, manufactures, and markets digital
imaging products and solutions, in addition to providing semiconductor
products and services. DALSA's core competencies are in specialized
integrated circuit and electronics technology, and highly engineered
semiconductor wafer processing. Products and services include image
sensor components; electronic digital cameras; and semiconductor wafer
foundry services for use in MEMS, high-voltage semiconductors, image
sensors and mixed-signal CMOS chips.

DALSA is a public company listed on the Toronto Stock Exchange under the
symbol "DSA". Based in Waterloo, ON, Canada, the company has operations
in Bromont, PQ; Colorado Springs, CO; Woodland Hills, CA; Eindhoven, NL;
Munich, Germany and Tokyo, Japan.

About Coreco Inc

Coreco Inc. is a leader in the design, development, manufacturing and
marketing of hardware and software that help enhance the productivity,
quality and cost-competitiveness of manufacturing processes. The
Company serves two target markets: Original Equipment Manufacturers
(OEMs) and End-users. The OEM group provides a full range of frame
grabbers, embedded products and accompanying software for integration in
high-performance machine vision applications in the industrial vision,
medical imaging, multimedia and surveillance markets. The Intelligent
Products group (IPD) provides user-friendly, cost-effective vision
appliances for task-specific factory floor applications, such as
gauging, high-precision alignment, inspection, assembly verification and
machine guidance. Coreco employs a staff of 145 people and has
operations in Montreal (QC), Vancouver (BC), and Billerica near Boston
(MA), with additional sales offices in Cleveland (OH), San Juan
Capistrano (CA) and Tokyo, Japan.

This press release contains forward looking statements based on
assumptions, uncertainties and management's best estimates of future
events. Actual results may differ materially from those currently
anticipated. Investors are cautioned that such forward-looking
statements involve risks and uncertainties. Important factors that could
cause actual results to differ materially from those expressed or
implied by such forward looking statements are detailed from time to
time in each periodic reports filed with the Ontario Securities
Commission and other regulatory authorities. Neither company has the
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    DALSA Corporation
    Patrick Myles
    Director, Corporate Communications
    (519) 886-6001 Ext. 2177
    (519) 886-3972 (FAX)
    Investor@dalsa.com
    www.dalsa.com
    or
    Coreco Inc.
    Keith A. Reuben
    President and Chief Executive Officer
    (514) 333-1301
    (514) 333-1867 (FAX)
    www.coreco.com
    or
    Coreco Inc.
    Louis Daigneault
    Chief Financial Officer
    (514) 333-1301
    (514) 333-1867 (FAX)
    www.coreco.com
    or
    Coreco Inc.
    Grace Pollock
    Investor and Media Relations
    (514) 940-3717
    investors@coreco.com