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                                  EXHIBIT 99.1
                                                                    NEWS RELEASE
[LOGO]
P. O. Box 5000
Victoria, Minnesota 55386 USA
952-443-2500

CONTACTS:                                            FOR IMMEDIATE RELEASE
         Anthony J. Fant, CEO
         Donald R. Reynolds, President/COO
         Steve E. Tondera, CFO

             HEI ANNOUNCES SIGNIFICANT FIBER OPTICS SUPPLY AGREEMENT

MINNEAPOLIS, August 24, 2000 -- HEI, Inc. (Nasdaq: HEII, www.heii.com) announced
today that it has received its first production order for performing alignment
of fiber optic devices. This order from a major multinational customer begins
immediately and should exceed $3,000,000 over the next several quarters. Fiber
alignment is one of the key operations in the production of fiber optic
assemblies used in applications such as high-speed internet routing and data
communications.

"We expect the tremendous growth in the multi-billion dollar fiber optics market
to continue well into the future and this is the kind of market in which we are
seeking new opportunities. We are excited to have taken this step in executing
our technology plan to become a full service provider of optical components and
modules to optical system vendors. HEI should be building complete fiber optic
devices within the upcoming year and we expect our overall fiber optic business
to grow to $10,000,000 in our fiscal year beginning September 1, 2000," said
Anthony Fant, Chairman and Chief Executive Officer of HEI, Inc.

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HEI, Inc., and Cross Technology, Inc., a wholly owned subsidiary of HEI, Inc.,
specialize in the custom design and manufacture of high performance,
ultraminiature microelectronic devices and high-technology products
incorporating those devices. HEI and Cross contribute to their customers'
competitiveness in the hearing, medical, communications, wireless smart cards,
other RF applications, and industrial markets through innovative design
solutions and by the application of state-of-the art materials, processes and
manufacturing capabilities.

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World Headquarters and Microelectronics Division  PO Box 5000, 1495 Steiger Lake Lane, Victoria, MN 55386
Mexico Division, Customer Service Center          1 Offshore International, 777 East MacArthur Circle, Tucson, AZ 85714
High Density Interconnect Division                610 South Rockford Drive, Tempe, AZ 85281
Cross Technology, Inc.                            5201 Eden Circle, Edina, MN 55436
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FORWARD LOOKING INFORMATION

INFORMATION IN THIS NEWS RELEASE, WHICH IS NOT HISTORICAL, INCLUDES
FORWARD-LOOKING STATEMENTS MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. STATEMENTS CONTAINED IN THIS
PRESS RELEASE REGARDING PROFITABILITY OF THE COMPANY, BENEFITS IN FY2000
RESULTING FROM THE COMPANY'S INVESTMENTS, AND THE ESTIMATED REVENUE GROWTH RATES
AND PROFITABILITY ARE FORWARD LOOKING STATEMENTS. ALL OF SUCH FORWARD-LOOKING
STATEMENTS INVOLVE RISKS AND UNCERTAINTIES INCLUDING, WITHOUT LIMITATION,
ADVERSE BUSINESS OR MARKET CONDITIONS, THE ABILITY OF HEI TO SECURE AND SATISFY
CUSTOMERS, THE AVAILABILITY AND COST OF MATERIALS FROM HEI'S SUPPLIERS, ADVERSE
COMPETITIVE DEVELOPMENTS, CHANGE IN OR CANCELLATION OF CUSTOMER REQUIREMENTS,
AND OTHER RISKS DETAILED FROM TIME TO TIME IN HEI'S SEC FILINGS.