WACKER CONTINUES EXPANSION OF POLYSILICON PRODUCTION AT ITS BURGHAUSEN SITE

- DECISION TO EXPAND NOMINAL PRODUCTION CAPACITY BY ANOTHER 4,500 METRIC TONS
PER YEAR
- SOLAR-SECTOR DEMAND FOR POLYSILICON EXPECTED TO SHOW FURTHER RAPID GROWTH
- CAPITAL EXPENDITURES OF ABOUT €300 MILLION ARE ESTIMATED TO CREATE SOME 270
JOBS
- CEO PETER-ALEXANDER WACKER: “WE’VE REACHED ANOTHER MILESTONE IN OUR GROUP’S
LONG-TERM STRATEGY FOR PROFITABLE GROWTH”

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WACKER plans to expand its annual polysilicon production capacity at
Burghausen by an additional 4,500 metric tons to a total of 14,500
metric tons by the end of 2009. The Munich-based chemical company
made this decision today. WACKER had already initiated polysilicon
expansion measures to increase nominal production capacity from
currently 5,500 metric tons/year to an estimated 10,000 metric tons
by early 2008. First material for sale from the new, so-called
"capacity expansion stage 7" is expected to be available in Q4 2008.
The new plant is scheduled to reach full capacity until end of 2009.
WACKER has earmarked capital expenditures of around EUR300 million
for this project, which is expected to create some 270 jobs.

By expanding its output, WACKER intends to meet soaring global demand
for hyperpure polycrystalline silicon. The main growth driver is the
solar industry, which requires silicon for the manufacture of solar
cells. WACKER forecasts further solar-market growth over the next
four years. Consequently, it expects solar-sector polysilicon demand
to increase at an annual double-digit rate. As for the electronics
sector, WACKER is expecting a high single-digit rise of polysilicon
demand.

"Today’s expansion decision is another milestone to deliver on the
Group’s long-term strategy for profitable growth," said Dr.
Peter-Alexander Wacker, the Group’s president and CEO. "We are
already the world’s second-largest polysilicon producer and plan to
become market leader. We want to practically triple our polysilicon
production capacity by the end of 2009. Also, we consider this
project a major contribution to accelerate growth in the solar
industry," added the CEO.

"Burghausen was chosen as the site for this expansion stage in the
face of considerable intra-Group competition from European and North
American locations," said Dr. Ewald Schindlbeck, president of WACKER
POLYSILICON. "Extensive studies prior to this investment decision
showed that Burghausen was the right choice," he explained, "not only
from an economic point of view, but also due to the speed of
constructing the new plant there."

Key factors in Burghausen’s favor were agreements concluded between
management, employee representatives and the IG-BCE trade union about
cost-saving measures and further increases in worktime flexibility.
The negotiating parties agreed, for a period of five years, to fix
starting salaries for new Burghausen employees at 90 percent of the
standard rate. They also decided to expand the flexi-time period for
Burghausen employees from the current one year to three years. This
will allow more flexibility in the face of order fluctuations.

WACKER has been producing hyperpure polycrystalline silicon for the
semiconductor industry at its Burghausen site for over 50 years. With
solar-silicon demand rising, WACKER POLYSILICON has been increasing
sales to the photovoltaics industry over the past six years while
expanding capacity step by step.

This press release contains forward looking statements based on
assumptions and estimates of WACKER's Executive Board. Although we
assume the expectations in these forward looking statements are
realistic, we cannot guarantee they will prove to be correct. The
assumptions may harbor risks and uncertainties that may cause the
actual figures to differ considerably from the forward looking
statements. Factors that may cause such discrepancies include, among
other things, changes in the economic and business environment,
variations in exchange and interest rates, the introduction of
competing products, lack of acceptance for new products or services,
and changes in corporate strategy. WACKER does not plan to update the
forward looking statements, nor does it assume the obligation to do
so.

end of announcement euro adhoc 28.06.2006 15:39:45
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ots Originaltext: Wacker Chemie AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:
Christof Bachmair
+49 (0)89 6279 1830
christof.bachmair@wacker.com

Branche: Chemicals
ISIN: DE000WCH8881
WKN: WCH888
Index: CDAX
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