Marvell says committee seeks CEO's removal as chairman

As previously announced, the Board of Directors concluded on October 2, 2006 that the actual measurement dates for financial accounting purposes of numerous stock option grants issued in the past differ from the recorded grant dates of such awards. The Special Committee has determined that there were numerous instances in which grant dates were chosen with the benefit of hindsight as to the price of the Company's stock, so as to provide exercise prices lower than the fair market value on the actual measurement date. In addition, the Special Committee found a systemic failure of internal controls with respect to the stock option process and related matters, as well as a failure by certain members of current and former management to exercise sufficient oversight over the stock option process, resulting in inaccuracies in the Company's books and records, financial statements, and public filings. The Special Committee reported that several current and former members of management, including the previously terminated General Counsel of its U.S. operating subsidiary and the recently resigned Chief Financial Officer and Chief Operating Officer, bear varying degrees of responsibility for these deficiencies.

The Special Committee found that the Company's Chief Executive Officer participated in only a few instances in grants with incorrect measurement dates. The Special Committee recommended that Dr. Sehat Sutardja remain as Chief Executive Officer and as a member of the Board of Directors, but step down as Chairman of the Board in favor of a non-executive Chairman of the Board. The board's Governance Committee is commencing a search for three new independent directors to fill existing vacancies. One of these independent directors will succeed Dr. Sutardja as Chairman of the Board. Dr. Sutardja, upon such event, will remain a director and continue as the Company's President and Chief Executive Officer.

The Company also announced that Weili Dai, Marvell's co-founder, Executive Vice President and Chief Operating Officer and member of the Board of Directors, will no longer serve as Executive Vice President, Chief Operating Officer and director, but will continue with the Company in a significantly reduced role as the Director of Strategic Marketing and Business Development, a non-management position. In addition, the Company announced that Matthew Gloss, the former General Counsel of its U.S. operating subsidiary, previously had been terminated. The Company also announced that it had accepted the resignation of George Hervey, the Company's Chief Financial Officer. The Company has appointed Mike Tate, its Corporate Controller and Treasurer, to serve as interim Chief Financial Officer.

In late December, Dr. Sutardja, Ms. Dai and Mr. Hervey each voluntarily agreed with the Company to reform the outstanding stock option agreements for grants previously awarded to them which were determined to have measurement dates different from the recorded grant dates and the fair market values on those measurement dates were higher than those on the corresponding recorded grant dates. Pursuant to those agreements, the parties corrected the exercise price for each affected grant still outstanding to that which would have been applicable had the grant been made using the actual measurement date for accounting purposes. To the extent that such an option already had been exercised, each executive remitted to the Company the full amount of the difference between the exercise prices of the options as granted and the fair market values of the underlying Common Stock on the actual measurement dates.

In addition, Dr. Sutardja has agreed to reduce the number of shares received in his December 26, 2003 grant by 500,000 pre-split shares (2,000,000 post-split shares), which is the amount of underlying shares mistakenly awarded by a committee of independent directors in excess of that authorized under the applicable stock option plan.

Ms. Dai also has agreed to cancel options to purchase an aggregate of approximately 1,500,000 post-split unvested shares, which are all of her remaining unvested shares as of May 6, 2007 under the December 26, 2003, March 10, 2006 and May 25, 2006 grants, and to limit the exercisability of already vested options.

As previously announced, the Company will restate its historical financial statements to record additional non-cash charges for stock-based compensation expense related to past option activity. The Company and its independent auditors have not yet made a final determination as to the amount of such charges and the resulting tax and accounting impact. However, the Company currently anticipates recording a total cumulative, pre-tax, non-cash, stock-based compensation expense adjustment ranging from $325 million to $350 million for periods through fiscal 2006. This amount is a preliminary estimate and has not yet been audited by the Company's independent auditors.

Remedial Measures

On April 26, 2007, the Board of Directors formed an Implementation Committee, consisting of independent members of the Board, and authorized it to make such decisions and take such action as the Implementation Committee determines to be appropriate in light of the Special Committee's findings and recommendations. The Implementation Committee has taken or is in the process of implementing each recommendation of the Special Committee except with respect to Ms. Dai, which it did not accept in full. The Implementation Committee determined that retaining the services of Ms. Dai as Director of Strategic Marketing and Business Development, a non-management role which involves no responsibility for financial matters or internal controls of the Company, better serves the interests of all shareholders. Other actions taken or initiated by the Implementation Committee include the following:

    -- Conduct a search for a new Chief Operating Officer, Chief Financial
       Officer and General Counsel.
    -- Further improve controls regarding memorialization of board action and
       documentation of equity awards.
    -- Develop an equity award granting process to provide a more regular
       schedule for when grants are made.  This process will build on the
       improvements which already have been made to the processes previously
       in place by the Company and its Board.
    -- Require that all equity awards be made only by the board or by the
       Executive Compensation Committee, which is comprised of independent
       directors.  This change already had been made but now is formalized.
    -- Implement cross-functional training for persons involved in the equity
       award process and accounting, and a financial, legal and management
       educational program for senior management.
    -- Create the position of Vice President of Compliance, who will report
       directly to the Audit Committee of the Board of Directors.

On March 30, 2007, Marvell Technology Group Ltd. ("we," "our," "us" or the "Company") received a notice from The NASDAQ Stock Market stating that the Company is not in compliance with NASDAQ Marketplace Rule 4310(c)(14) because the Company has not timely filed its Annual Report on Form 10-K for the fiscal year ended January 27, 2007.

The company issued a press release on April 2, 2007, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Special Committee of Board of Directors

Effective March 30, 2007, the Company's Board of Directors appointed John J. Quinn, Esq. and Dr. William G. Howard, Jr. as non-director members of the special committee regarding derivative litigation of the Company's Board of Directors (the "Special Committee"). Under the Company's bye-laws, the Board of Directors can delegate any of its powers to a committee that may consist partly or entirely of non-directors. The Special Committee, previously comprising one director, will now comprise the two non-directors named above. The Special Committee will continue the previously announced internal review relating to the Company's historical stock option practices and related accounting matters.

Mr. Quinn is a retired Partner at the law firm of Arnold & Porter LLP and former President of the Los Angeles County Bar Association. Mr. Quinn has received numerous awards and honors for his distinguished service in the legal community, including the Shattuck-Price Award, the Los Angeles County Bar Association's highest honor, and the Distinguished Service Award presented by the United States Court of the Ninth Circuit. Mr. Quinn has served as the Chairperson of the Senator Barbara Boxer Federal Judicial Selection Committee, overseeing the selection of nominees for federal judicial appointment of the United States District Court. He was also Chairperson of the Disciplinary Committee of the District Court for the Central District of California from 1995 to 2001.

Dr. Howard has been an independent engineering consultant to various semiconductor and microelectronics companies since December 1990, including Xilinx, Inc., the Semiconductor Industry Association, and Dow Corning Corporation. From October 1987 to December 1990, Dr. Howard served as a senior fellow at the National Academy of Engineering conducting studies of technology management. Dr. Howard held various management positions at Motorola, Inc., a wireless and broadband communications company, between 1969 and 1987, including Senior Vice President and Director of Research and Development. Dr. Howard previously served as a director of Credence Systems Corporation, a supplier of design-to-test solutions for semiconductors, and BEI Technologies, Inc., a manufacturer of electronic sensors, motors, actuators, encoders and motion control products, until its sale in 2005. Dr. Howard is Chairman of Thunderbird Technologies, a private company developing new transistor technologies, and the Ramtron International Corporation, a manufacturer of memory products, and a director of Xilinx, Inc., a semiconductor company, and Sandia Corporation, a Lockheed Martin company that manages Sandia National Laboratories. Dr. Howard serves on the Defense Science Board and is a former chair of the Department of Defense's Advisory Group on Electron Devices.

Updated Risk Factor

The Company also hereby updates the first additional risk factor set forth in its Current Report on Form 8-K filed on October 17, 2006 to read in its entirety as follows:

Until we file our delayed Forms 10-Q and 10-K, there will be limited public information available concerning our results of operations and financial condition. The delay in the filing of our Forms 10-Q and 10-K and the restatement of our financial statements, and the related uncertainties, may also have other adverse effects.

We have not filed our Forms 10-Q for the fiscal quarters ended July 29, 2006 and October 28, 2006 and our Form 10-K for the fiscal year ended January 27, 2007. Until we have filed our Forms 10-Q and 10-K, there will be limited

public information available concerning our results of operations and financial condition. The absence of more recent financial statements may have an adverse effect on us and on the market prices of our securities.

Timely filing of periodic reports with the SEC is a requirement for continued listing of our shares on the NASDAQ Global Select Market. The NASDAQ Stock Market's Listing Qualifications Panel determined that the continued listing of our shares was contingent on filing our delayed Forms 10-Q and 10-K by March 7, 2007. We appealed the Panel's decision to the Nasdaq Listing and Hearing Review Council, which stayed the Panel's decision pending further action and set a deadline of March 30, 2007 for us to submit to the Listing Council materials, other than those publicly filed, for the Listing Council's consideration. We do not know when the Listing Council may take any further action regarding its stay. Even if the Listing Council decides to continue its stay of the Panel's determination and our shares continue to be listed, we will still have to file our delayed Forms 10-Q and 10-K and otherwise meet NASDAQ's listing requirements by June 28, 2007 or face delisting. The Listing Council could also choose to require us to regain compliance by a date earlier than June 28, but it cannot extend the June 28 deadline.

We have to complete our internal review relating to our historical stock option practices and related accounting matters and the restatement of our financial statements before we can file our delayed Forms 10-Q and 10-K. If we are unable to do so by June 28, 2007 or any earlier date that the Listing Council may establish, or if the Listing Council determines instead to lift its stay, our common stock will be delisted. Delisting could cause our stock price to decline, would likely make the market for trading of our common stock less liquid, and could make it more difficult or more expensive for us to raise capital.

The delay in the filing of our Forms 10-Q and 10-K and the restatement of our financial statements, and the related uncertainties, may also have other actual or potential adverse effects in addition to those discussed above, including adverse effects on the perception of the Company by existing and potential customers and suppliers, our ability to raise needed financing through the issuance of equity or convertible debt securities, our ability to recruit and retain qualified personnel, and investor confidence.