ATI announced via press release that they are acquiring the bad boys of the graphics accelerator world, Bitboys Oy, for approximately $44 million US. Bitboys rose to fame on its early GPU announcements full of hype and promise, that would somehow not materialize, including the Pyramid3D chips and the Glaze3D chips that would supposedly toast the competition. Currently, Bitboys licenses GPU technology to mobile phone development companies, and has worked with providers such as Erikkson and NEC, and has received investments from companies like Nokia. While ATI is ostensibly acquiring Bitboys for its mobile technology, they may also be looking for a company that can output roughly four times the hype than ATIs current marketing provides.

Full Press Release after the jump.

ATI acquires Bitboys Oy, a leading developer of mobile graphics technology

MARKHAM, ONTARIO, May 2, 2006 (CCNMatthews via COMTEX News Network)—ATI Technologies Inc. (TSX:ATY)(NASDAQ:ATYT) has acquired privately held Bitboys Oy, a 15-year veteran of the graphics industry for up to EUR 35.2 million (about US$44 million). The final value is subject to certain performance-related conditions. Bitboys brings valuable engineering experience, technology and customer relationships that enhance ATI’s existing mobile phone multimedia offerings. Based in Finland, the Bitboys team will be fully integrated in to ATI’s Handheld Business Unit, and form the nucleus for a key design centre for ATI in Europe.

ATI is well-known in the mobile phone industry for providing high-performance graphics and multimedia solutions; this acquisition enhances ATI’s product portfolio with a number of technologies, including OpenGL ES 2.0 3D graphics and OpenVG 1.0 2D vector graphics technologies optimized for high-volume mainstream mobile phones. These graphics cores will be supported by ATI’s common software stack which covers its complete range of multimedia co-processors. This unified software environment allows developers to easily create content for a range of devices and offers mobile phone manufacturers faster time to market.

“ATI gives us what we need to reach the next level,” said Mikko Saari, CEO, Bitboys. “Their market presence and ability to sell our products as part of a complete multimedia lineup will prove incredibly valuable to us. It’s a classic win-win, realizing value for both companies.”

“Bitboys dovetails into ATI perfectly,” said Paul Dal Santo, GM of ATI’s Handheld Business Unit. “Handsets are transitioning to hardware acceleration for graphics and multimedia, and the Bitboys team will play a critical role as we drive this key inflection point to make ATI the platform of choice for content providers.”

Vector graphics is a vital component of a multimedia product lineup as it will become the standard for creating user interfaces on mobile devices. It’s a very compact format that allows more graphics to be stored on a phone and for content to be distributed much more efficiently over mobile networks. In addition, vector graphics content automatically scales to any screen resolution so developers can deliver content across a range of devices without reworking all of the art assets.

About ATI Technologies

ATI Technologies Inc. is a world leader in the design and manufacture of innovative 3D graphics, PC platform technologies and digital media silicon solutions. An industry pioneer since 1985, ATI is the world’s foremost graphics processor unit (GPU) provider and is dedicated to deliver leading-edge performance solutions for the full range of PC and Mac desktop and notebook platforms, workstation, set-top and digital television, game console and handheld device markets. With fiscal 2005 revenues of US $2.22 billion, ATI has more than 3,400 employees in the Americas, Europe and Asia. ATI common shares trade on NASDAQ (ATYT) and the Toronto Stock Exchange (ATY).

About Bitboys

Finland-based Bitboys develops and licenses graphics hardware IP solutions for various wireless and embedded devices. Bitboys graphics processors are specifically designed for power and size-restricted environments and are the outcome of 15 years of experience in graphics research and development. The first product line targeted for wireless and embedded devices has been available for licensing since July 2003. Bitboys currently employs over 40 dedicated graphics professionals. www.bitboys.com.

Important Information Regarding Forward-looking Statements

Certain statements in this news release, including but not limited to the successful integration of the Bitboys team with ATI’s existing infrastructure, the enhancement of ATI’s position with respect to handheld multimedia technology, the critical role Bitboys will play in the transitioning of handsets to hardware acceleration, and role Vector graphics will have in multimedia product lineups, may be considered “forward-looking”. Such forward-looking statements are based on current expectations, and, accordingly, entail various risks and uncertainties. Risks that could cause actual results to differ materially from such forward-looking statements include demand for and acceptance of our products and those of our customers, rapid and frequent technological change in handheld multimedia technology, and the addition or loss of significant customers. We therefore cannot provide any assurance that such forward-looking statements will materialize. We assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason. Additional information concerning risks and uncertainties affecting our business and other factors that could cause actual results to differ materially from any forward-looking statement is contained in our filings with Canadian and U.S. securities regulatory authorities, including our 2005 Annual Information Form and 2005 Annual Report filed on SEDAR at www.sedar.com. Our Form 40-F and other filings we make with the U.S. Securities and Exchange Commission are available on EDGAR at www.sec.gov.

Copyright 2006 ATI Technologies Inc. All rights reserved. ATI and ATI product and product feature names are trademarks and/or registered trademarks of ATI Technologies Inc. All other company and product names are trademarks and/or registered trademarks of their respective owners. Features, pricing, availability and specifications are subject to change without notice.

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SOURCE: ATI Technologies Inc.