Ceradyne, Inc. Acquires Interest in Graphite Machining Services and Innovations, LLC

COSTA MESA, CA–(Marketwire – August 10, 2012) – Ceradyne, Inc. (NASDAQ: CRDN) announced that it has acquired a minority interest with an option to acquire all of Tempe, Arizona-based Graphite Machining Services and Innovations, LLC (GMSI). GMSI has developed a proprietary method of applying a chemical vapor deposited (CVD) silicon carbide ceramic coating on precision machined graphite shapes. The resultant product is used in the manufacture of Light Emitting Diodes (LEDs) for the rapidly growing solid state lighting market.

GMSI’s expertise and technology have been focused on the precision machining of ultra-high quality graphite shapes since its founding in 1984. The demand for state-of-the-art components for use in the MOCVD (Metal Organic Chemical Vapor Deposition) process in the manufacturing of LEDs has led to GMSI’s shift in technology and manufacturing capacity to serve the LED and other semiconductor markets.

This acquisition of GMSI will not materially affect Ceradyne’s 2012 financial performance.

Mr. David Reed, president of Ceradyne’s North American Operations, commented: “We are excited about this relatively small but high technology investment in GMSI. It fits very well with our diversification strategy, coupled with our interest in building out Ceradyne’s advanced technical ceramics portfolio. Furthermore, the market for efficient, environmentally friendly LED lighting systems is expected to grow very rapidly over the next ten years.”

Mr. Reed further stated, “The GMSI facility in Tempe is absolutely first class and GMSI’s president, Peter Guercio, and his partners, Rex Dillman and Dale Beeck, are excellent additions to Ceradyne’s entrepreneurial, technology-driven culture.”

Peter Guercio, GMSI’s president, commented: “The relationship with Ceradyne is perfect. It is clear to us with the growth opportunities we see ahead that we will need the resources of a larger technology operation. Ceradyne and its advanced technical ceramic focus is the ideal partner. We are looking forward to our growth in the burgeoning LED markets.”

About Ceradyne, Inc.
Ceradyne develops, manufactures, and markets advanced technical ceramic products and components for industrial, energy, automotive/diesel, and commercial applications.

In many high performance applications, products made of advanced technical ceramics meet specifications that similar products made of metals, plastics or traditional ceramics cannot achieve. Advanced technical ceramics can withstand extremely high temperatures, combine hardness with light weight, are highly resistant to corrosion and wear, and often have excellent electrical capabilities, special electronic properties and low friction characteristics. Additional information about the Company can be found athttp://www.ceradyne.com.

Forward-Looking Statements
Except for the historical information contained herein, this press release contains forward-looking statements regarding future events and the future performance of Ceradyne that involve risks and uncertainties that could cause actual results to differ materially from those projected. Words such as “anticipates,” “believes,” “plans,” “expects,” “intends,” “future,” and similar expressions are intended to identify forward-looking statements. These risks and uncertainties are described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011 and its Quarterly Reports on Form 10-Q as filed with the U.S. Securities and Exchange Commission.