Comverse has signed a definitive agreement to acquire privately-held Netcentrex for approximately $164 million in cash

April 10, 2006

2 Min Read

NEW YORK -- Comverse Technology, Inc. (NASDAQ: CMVT) today announced that Comverse Inc. has signed a definitive agreement to acquire privately-held Netcentrex S.A., for approximately $164 million in cash, subject to certain adjustments and a contingent earnout of up to an additional $16 million. The actual amount of the contingent earnout payment, if any, will be determined based upon achievement of certain financial targets by the Netcentrex business during the remainder of fiscal 2006 and for fiscal 2007.

The combination of Netcentrex, a leader in network-based software enabling IP-based voice-video-data (“triple-play”) and FMC (fixed-mobile convergence) solutions for service providers, serving the enterprise and consumer segments, with Comverse’s portfolio of value-added multimedia messaging, content and converged billing solutions, is expected to benefit operators deploying differentiating, multimedia services in the VoIP (Voice-over-Internet Protocol) and IMS (IP Multimedia Subsystem) domains. The acquisition, which is expected to close by July 1, 2006, is projected to be neutral to the company’s fiscal 2006 (year ending January 31, 2007) pro forma net income. Pro forma net income excludes the impact of purchase accounting adjustments related to the write-down of deferred revenue, amortization of intangibles, and other acquisition-related costs, among other items.

Kobi Alexander, Chairman and CEO of Comverse Technology, said, “We believe VoIP, FMC and IMS-based communication services are poised to grow in the coming years, and that Netcentrex is well-positioned to address many of these opportunities. Together, the two companies offer a broad portfolio that enables converged voice-video-data solutions, serving wireless, fixed, cable, MVNO and Internet-based communication service providers.”

Zeev Bregman, CEO of Comverse, the company’s network systems unit, said, “Netcentrex complements our product portfolio, technology, and strategic direction. Netcentrex’s leading telco-grade application server, rich IP Centrex, Class 5 and video services and proven market position (with over 2.8M live VoIP lines), together with Comverse’s telecom VAS and billing leadership, create a synergetic, unique VoIP, FMC and IMS offering.”

“We are delighted to join forces with Comverse,” said Olivier Hersent, Chairman and CTO of Netcentrex. “Our combined expertise will benefit both existing and new clients, and will allow all types of operators to build innovative service bundles based on IP applications.”

Comverse Inc. (Nasdaq: CNSI)

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