Telit Communications Plc

Telit Communications Plc

May 30, 2006 03:45 ET

Telit Communications plc: South Korean Acquisition Strengthens Telit's Global Presence

LONDON, UNITED KINGDOM--(CCNMatthews - May 30, 2006) - Telit Communications plc (AIM:TCM), the global wireless communications developer and distributor, is pleased to announce the acquisition of 75% of Bellwave m2m Co. Ltd, the machine to machine ("m2m") division of Bellwave Co. Ltd ("Bellwave"), a South Korean wireless communications developer, in a cash transaction totalling US$6.18 million. Bellwave's m2m business has generated some US$21 million revenue in 2005 with dominant market share in South Korea close to 50%.

Bellwave Co. Ltd will retain the remaining 25% of Bellwave m2m, however, Telit holds a call option to purchase the remaining 25% for US$2 million exercisable until December 2006. Bellwave m2m business has a net asset value of approximately US$2 million.

Bellwave m2m, which developed and marketed the world's smallest CDMA data communications module, has currently 40 employees the majority of who are engineers. The company will focus on the development of CDMA 1X and EVDO products for Asian and American markets and the development of WCDMA/UMTS products for global distribution. The company will also serve as Telit's sales gateway to the emerging Asia Pacific markets for both CDMA and GSM/GPRS product lines.

Commenting on the acquisition, Oozi Cats, Chief Executive of Telit Communications, said: "The combination of Telit's and Bellwave m2m's expertise brings many synergies and benefits, most noticeably in product range and geographical presence. Bellwave m2m brings to Telit a solid customer base in the Korean market and depth of experience in the CDMA market that will create a strong gateway to expand Telit's presence in the Asia Pacific and US markets. Telit already has distributor network in place that covers a majority of worldwide markets. The combination of the two entities will create a new force in the m2m market, capable of servicing all CDMA and GSM and in a future also WCDMA markets, on a global basis."

The transaction is subject to customary closing conditions and is expected to complete during June 2006.

For further information:

Telit Communications plc Tel: 00 39 040 419 2491
Oozi Cats, Chief Executive

Merav Zimerman, CMO Tel: +97 237 914 000

Media enquiries:

Chris Lane / Laura Riascos de Castro Tel: +44 (0) 20 7398 7700

Notes to Editors

Telit Communications plc is a global business specialising in innovative customised mass production solutions for cellular communications. The Company has two distinct business operating divisions leveraging on its core intellectual property and know how:

Wireless Solutions Business Unit which designs, develops, manufactures, markets and sells a range of data cellular communication products for the machine to machine ("m2m") market. The Company's technology and products enable other electronic devices and equipment manufacturers to utilise the widely deployed GSM/GPRS cellular infrastructure to relay and accept information without human intervention. Telit owns its own protocol stack and supplies A-Z solutions for the m2m market.

The Enhanced Value Added Reseller ("EVAR") Business Unit which customises and distributes to mobile operators and to independent retailers, under the recognised brand "Telit", ODM's and OEM's cellular products, utilising its extensive in-house research and development resources.

Global System for Mobile Communication (GSM)

GSM is a digital cellular phone technology that is the predominant system in Europe, but is also used around the world. Developed in the 1980s, GSM was first deployed in seven European countries in 1992. Operating in the 900MHz and 1.8GHz bands in Europe and the 1.9GHz PCS band in the U.S., GSM defines the entire cellular system.

Code Division Multiple Access (CDMA)

CDMA requires fewer cell sites than the GSM digital cellphone system and provides three to five times the calling capacity. Providing more than ten times the capacity of the analogue cellphone system (AMPS), CDMA has become widely used in North America. CDMA transmission has been used by the military for secure phone calls.

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