DIAMOND MULTIMEDIA SYSTEMS, INC. AGREES TO ACQUIRE SUPRA CORPORATION

SAN JOSE, Calif. -- August 7 , 1995 -- Diamond Multimedia Systems, Inc.
(Nasdaq: DIMD), a leading developer and marketer of high-performance
multimedia solutions for personal computers, today announced that it has
entered into a definitive agreement to acquire Supra Corporation, a leader
in modems for the Apple Macintosh and PC markets.

The privately-held company headquarted in Vancouver, Washington, is to be
purchased by Diamond Multimedia, subject to certain closing conditions
including state and federal regulatory approvals, for a combination of
cash and stock with a value of approximately $54 million based on a
closing price of $21.75 for Diamond Multimedia shares on August 4,
1995.Management expects the transaction to be completed during September.
As a result, Diamond anticipates that it will incur a one-time write-off
of in-process research and development of more than $30 million in the
third quarter ended September 30, 1995.

"This merger is a significant step in continuing to build Diamond
Multimedia as a premier supplier of complete multimedia solutions to both
the PC and Macintosh markets," said Bill Schroeder, president and CEO of
Diamond Multimedia Systems.

John Wiley, president of Supra Corp., will report directly to Schroeder as
vice president of Diamond Multimedia and general manager for Diamond's new
Communications Division, which will continue under the Supra brand name.
Wiley will also join the Board of Directors of Diamond Multimedia.

"Supra's strength in state-of-the-art, high-speed modem technology is
expected to enable Diamond to more fully participate in the rapidly
expanding personal computer connectivity market, where growth is being
fueled by demand for high-bandwidth products to access the Internet and
other online electronic services. Supra's data communications technology
augments Diamond's recently introduced TeleCommander series of
audio/telephony products. Supra's strong presence with Apple users is also
expected to aid Diamond in penetrating this market with its new Javelin
Video 3000 series of multimedia accelerators for PCI Power Macs. In
addition, Supra's strong distribution network of resellers and leading
retailers will further strengthen Diamond's market position," said
Schroeder.

"We are pleased to become a part of the Diamond team," said John Wiley,
president of Supra. "Diamond's financial strength and strong PC market
presence in the U.S., Europe and Japan will help us more quickly increase
our penetration of the large and growing PC modem market. Both Supra and
Diamond Multimedia are proven leaders in our respective industries.
Combined sales for both companies topped $255 million in 1994. Our
strengths are highly complementary. I believe this merger will benefit
both organizations and our customers."

Joint development and marketing of a new generation of multimedia
telecommunications products, including products based on DSVD and ISDN
technologies, are planned. Such products will enhance the telephony
capabilities of personal computers, as well as their ability to send and
receive multimedia data objects, such as those that are widely available
today on the Internet, World Wide Web and various online services.

"Diamond's strength in video, graphics and audio development and multimedia
marketing, combined with Supra's ten years of communications expertise,
should lay the foundation for us to become an industry leader in complete
multimedia solutions for personal computers worldwide," said Schroeder.

SUPRA CORPORATION

Founded in 1985, Supra Corporation is one of the world's top five modem
manufacturers, with sales of approximately $17 million in the quarter
ended June 30, 1995 and an estimated installed base of almost two million
modems. The company has established itself as a price/performance leader
for high quality desktop communications solutions for both the PC and
Macintosh markets. Supra's products include internal and external
fax/modems and related software for 28,800 bps transmission, the fastest
transfer rate currently available.The company's products frequently
receive top honors from trade industry publications, most recently in
PC/Computing and MacWorld magazines. Supra's current distributors include
Ingram Micro, Merisel and Tech Data. Leading retailers that handle Supra
products include Computer City, Egghead Software, Fry's Electronics and
WalMart.

DIAMOND MULTIMEDIA

Diamond Multimedia Systems, Inc. designs, manufactures and markets
high-performance multimedia solutions for the PC, PowerPC and PCI Power
Macintosh markets. Products include graphics and multimedia accelerators,
which incorporate graphics, video and MPEG acceleration in a single
subsystem. Diamond also manufactures sound cards, audio/telephony
subsystems and multimedia upgrade kits for the personal computer market.
Headquartered in San Jose, Calif., Diamond has marketing and technical
support facilities in Tokyo, Munich and Slough (U.K.). The company's
products are sold through regional, national and international
distributors as well as to major computer retailers, mass merchants and
OEMs worldwide.

Diamond reported record sales and net income for the second quarter ended
June 30, 1995. Sales were up 100 percent from the same quarter of the
previous year to $95 million. Net income increased 46 percent to $7.8
million. The company currently has approximately 27 million shares and
equivalents outstanding.

HOW TO CONTACT DIAMOND MULTIMEDIA

There are many ways to reach Diamond for sales support, technical
assistance, driver updates and general information:

The Main Phone number is  408-325-7000; Fax:  408-325-7070
Product Support Voice:  408-325-7100; Product Support Fax:  408-325-7171
24-Hour Fax On Demand Service: 1-800-380-0030
America OnLine (Keyword: DIAMOND)
CompuServe (GO DMNDONLINE or GO GRAPHBVEN) [75300,3673]
Internet Web site: http://www.diamondmm.com
FTP site:  ftp.diamondmm.com
For information on Diamond products: 1-800-468-5846
BBS numbers at 408-325-7080 (to14.4K) or 408-325-7175 (to 28.8K baud)
 
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