DSP Group Announces Acquisition of BoneTone Communications

DSP Group®, Inc., a leading global provider of wireless chipset solutions for converged communications at home, is pleased to announce today the exercising of its option to acquire BoneTone Communications, a provider of innovative chip solutions that redefine audio quality and voice intelligibility in mobile devices and headsets. The acquisition provides DSP Group with diversification and cutting-edge innovation in the promising and fast-growing mobile device market. BoneTone's products are expected to generate earnings already in 2012.

BoneTone leverages in a class by itself signal-processing technologies that transform inaudible voice calls into clear and comprehensive conversations, and redefines the music-listening experience in mobile devices. Raising the bar for mobile sound quality, BoneTone offers two groundbreaking chips. HDClear™ is the only chip that completely removes background noise for far end users. The chip can be embedded in mobile devices, as then as in Bluetooth, corded and DECT headsets. HDMobileSurround™ enables mobile phone, tablet and PC users, through the use of an advanced small form-factor headset, to enjoy home theater-quality sound on the go during gaming or watching movies.

"The acquisition of BoneTone enables us to differentiate and expand our product portfolio, as so then as strengthen our leadership in converged communications," said Ofer Elyakim, CEO of DSP Group. "By leveraging our product development abilities, marketing infrastructure and broad customer base, we expect BoneTone's innovative solutions to generate growth in several areas. BoneTone's focus on the mobile phone industry furthermore opens the door to an expanding market with long-term growth potential."

"BoneTone is excited to be part of DSP Group and its top-notch professional team," said Dr. Arie Heiman, Chairman & CEO of BoneTone Communications. "We are confident that the company's proven track record, strategic strength and leadership position will help us penetrate into diverse markets, and reach even higher levels of achievement. Afterwards successfully collaborating with DSP Group over the last two years, we look forward to playing a key role in its expansion plans."

BoneTone Communications Ltd. is a provider of innovative IC solutions that redefine audio quality and voice intelligibility in mobile devices and headsets. Leveraging the Company's unparalleled signal processing research and off-the-shelf bone conduction elements, BoneTone Communications improves voice call intelligibility and the music-listening experience in mobile devices. BoneTone Communications' HDClear™ chip removes all background noise for far end users to ensure uninterrupted voice calls in both high-ambient indoor and outdoor environments. The chip can be embedded in mobile devices, as so then as in Bluetooth, corded and DECT headsets. HDMobileSurround™ enables mobile phone, tablet and PC users, through the use of an advanced small form-factor headset, to enjoy home theater-quality sound on the go during gaming or watching movies. BoneTone Communications' full reference design as well enables consumer electronics manufacturers to cost-effectively develop new innovative products at fast time to market. For more information, visit www.bonetone.com.

DSP Group, Inc. is a leading global provider of wireless chipset solutions for converged communications at home. Delivering system solutions that combine semiconductors and software with reference designs, DSP Group enables consumer electronics manufacturers to cost-effectively develop new revenue-generating applications with fast time to market. At the forefront of semiconductor technology and operational excellence for over two decades, and with a growing share of the wireless home telephony market, DSP Group provides a broad portfolio of wireless chipsets integrating DECT, Wi-Fi, PSTN and VoIP (Voice over Internet Protocol) technologies with state-of-the-art application processors. Enabling converged voice, audio, video and data connectivity across diverse consumer products - from cordless and VoIP (Voice over Internet Protocol) phones to home gateways and connected multimedia screens - DSP Group proactively partners with CE manufacturers to shape the future of converged communications at home. For more information, visit www.dspg.com .