IDT Bags Net2Phone

NEWARK, N.J. -- IDT Corporation (NYSE: IDT - News, IDT.C - News), an international telecom, entertainment and technology company, and Net2Phone, Inc. (NASDAQ: NTOP - News), a leading Voice over IP (VoIP) enabler for service providers, jointly announced today that they have executed a merger agreement, dated February 17, 2006, providing for the acquisition of Net2Phone by IDT. Under the terms and subject to conditions described in the merger agreement, NTOP Acquisition, Inc., a wholly-owned subsidiary of IDT, would merge with and into Net2Phone, with Net2Phone continuing as the surviving corporation. If the merger is consummated, each issued and outstanding share of common stock and Class A common stock of Net2Phone, other than shares held by IDT or its subsidiaries or as to which dissenters' rights have been perfected, will be canceled and converted automatically into the right to receive $2.05 in cash, without interest. This is the same price per share paid by IDT in its tender offer for Net2Phone common stock that expired after a subsequent offer period on January 27, 2006, in which IDT acquired approximately 31.6 million Net2Phone shares.

Following the merger, Net2Phone will be a privately held, wholly-owned subsidiary of IDT, and shares of Net2Phone common stock will cease to be quoted on the Nasdaq National Market and will be deregistered under the Securities Exchange Act. The aggregate consideration payable in the merger would be approximately $28.1 million.

The transaction has been approved unanimously by both the Net2Phone board of directors, following the recommendation of the Independent Committee of the Net2Phone board of directors, and the IDT board of directors. During the course of its deliberations, the Independent Committee has been advised by Kirkland & Ellis, LLP as legal advisor and The Blackstone Group, L.P. as financial advisor. Prior to making its determination, the Independent Committee received the opinion of The Blackstone Group, L.P. that, as of February 16, 2006 and subject to certain qualifications set forth in the opinion, the consideration of $2.05 per share in cash, without interest, in the proposed merger is fair to the holders of shares of Net2Phone's capital stock (other than IDT and its subsidiaries) from a financial point of view.

IDT Corp. (NYSE: IDT)