MOUNTAIN VIEW, Calif. and PARIS, Dec. 19 /PRNewswire-FirstCall/ -- ILOG(R) (Nasdaq: ILOG; Euronext: ILO, ISIN: FR0004042364) today announced that it has signed an agreement with IBM to market ILOG Fab PowerOps(TM) (FPO) -- ILOG's solution for semiconductor production scheduling -- to IBM's manufacturing execution systems (MES) customers, among others.

IBM will market ILOG FPO under the ILOG brand name to its installed base of SiView, LCDView and other View MES product customers. The agreement between ILOG and IBM is expected to result in new product revenue opportunities and service engagements for both companies. The services will be provided through IBM Technology Collaboration Solutions and IBM Global Business Services, with support from ILOG's Professional Services group.

Already implemented in early stages, at IBM's state-of-the-art 300 millimeter (mm) fab facility in East Fishkill, NY, in the photolithography and diffusion areas, ILOG FPO reduced cycle time by up to fifteen percent in those specific areas, and significantly reduced hot lot (urgent order) processing times as well. ILOG's FPO also improved visibility over in-process fab status, resulting in a more efficient plant that is more responsive to change. In addition to marketing ILOG FPO, IBM will demonstrate the products to customers at its 300 mm East Fishkill fab facility.

"IBM is a leading technology provider to the semiconductor industry, so there is no better company from our perspective to market FPO in conjunction with their SiView and LCDView offerings," said ILOG Chairman and CEO, Pierre Haren. "This alliance with IBM will enable us to increase both our market reach and technology advantage, especially in Asia, where much of the growth in semiconductor manufacturing is happening. Today's agreement is the latest example of our growing collaboration with IBM. "

"We've already seen increases in fab productivity due to the relationship with ILOG," said Dr. Elizabeth Williamson, IBM Director of 300mm Manufacturing Operations. "The enhanced dispatch scheduling capabilities that are provided by FPO have resulted in quantifiable benefits in IBM's 300mm facility, resulting in faster time to market for our customers."

Leveraging ILOG's market-leading optimization, business rule and visualization technologies, combined with detailed fab status information, ILOG FPO optimizes production scheduling across multiple process areas: diffusion, wets, photo, etch, and thin film. ILOG FPO fills a gap in the market for detailed production scheduling solutions, and this relationship with ILOG is expected to give IBM a competitive advantage over other semiconductor solutions providers. With ILOG FPO, a scheduling problem can be addressed based on the current status of the fab environment, giving users more control over unplanned events, such as tool interruptions, recipe qualifications and hot lots. The tools are expected to reduce capital equipment outlay by leveraging existing capacity. In addition, FPO's custom configuration options mean that each process can be tailored to meet the requirements of each individual customer's fab. For more information on ILOG Fab PowerOps please visit http://fpo.ilog.com/ .

About ILOG

ILOG delivers software and services that empower customers to make better decisions faster and manage change and complexity. Over 2,500 global corporations and more than 465 leading software vendors rely on ILOG's market-leading business rule management system (BRMS), optimization and visualization software components to achieve dramatic returns on investment, create market-defining products and services, and sharpen their competitive edge. ILOG was founded in 1987 and employs more than 730 people worldwide. For more information, please visit http://www.ilog.com/.

NOTE: ILOG is a registered trademark, and ILOG Fab PowerOps and ILOG FPO are trademarks, of ILOG.

All other company/product names and service marks may be trademarks or registered trademarks of their respective companies. See http://www.ibm.com/legal/copytrade.shtml .

Forward-looking Information

All of the statements included in this release, as well as oral statements that may be made by us or by officers, directors or employees acting on our behalf, that are not statements of historical fact, constitute or are based upon "forward-looking statements" within the meaning of the United States Securities laws that involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward- looking statements. Among the factors that could cause our actual results to differ materially are those risks identified in "Item 3. Key Information-Risk Factors," "Item 4. Information on the Company" and "Item 5. Operating and Financial Review and Prospects" of the Company's most recent Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission (the "SEC") and its other filings and submissions with the SEC, including, without limitation, quarterly fluctuations in our operating results; competition in our industry; the extended length of our sales cycle which impacts our ability to forecast product lines; our dependence on certain major independent software vendors; our investments in vertical markets; the increasing number of fixed price consulting agreements; decreased investment in our sales and marketing forces; changing market requirements; our ability to provide professional services activities that satisfy customer expectations; errors in our software products; the loss of key personnel; logistical difficulties, cultural differences, product localization costs, import and tariff restrictions, adverse foreign tax consequences and fluctuations in currencies resulting from our global operations; changes in tax laws or an adverse tax audit; our significant dependence on our proprietary technology; the impact of intellectual property infringement disputes; the impact of dilutive share issuances or the incurrence of debt and contingent liabilities and write-offs resulting from acquisitions; changes in accounting principles; and other matters not yet known to us or not currently considered material by us. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are qualified in their entirety by these cautionary statements. Readers are cautioned not to place undue reliance on these forward-looking statements. Unless required by law, the Company undertakes no obligation to revise these forward-looking statements to reflect new information or events, circumstances, changes in expectations or otherwise that arise after the date hereof.

CONTACT: Susan Peters of ILOG, +1-650-567-8109, or speters@ilog.com

Web site: http://www.ilog.com/