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MegaSoft Buys BCGI

Megasoft to acquire Boston Communications Group for approximately $65 million

July 11, 2007

2 Min Read

BEDFORD, Mass. and HYDERABAD, India -- Megasoft Limited (BSE Code No.: 532408) and Boston Communications Group, Inc., (Nasdaq: BCGI - News) today announced a definitive agreement for Megasoft Limited to acquire Boston Communications Group, Inc., for $3.60 per share of bcgi common stock, in cash, for an expected aggregate purchase price of approximately $65 million. The $3.60 per share price represents a premium of approximately 120 percent over bcgi's average closing share price during the 30 days ended July 6, 2007.

Under the terms of the merger agreement, Tea Party Acquisition Corp., a wholly-owned subsidiary of Megasoft, will commence a tender offer to acquire all of the outstanding shares of bcgi common stock for $3.60 per share in cash. The offer is expected to commence on or before August 1, 2007, and will expire at midnight on the 20th business day following and including the commencement date, unless extended in accordance with the terms of the merger agreement and the applicable rules and regulations of the Securities and Exchange Commission ("SEC").

The Board of Directors of Megasoft and bcgi have unanimously approved the definitive agreement. The Board of Directors of bcgi recommends that shareholders tender their shares in the tender offer. Members of bcgi's Board have agreed to tender their shares in the offer.

"We are extremely excited about this transaction and the resulting benefits to our shareholders, customers and employees," said Joseph Mullaney, chief financial officer and acting chief executive officer of bcgi. "Our shareholders receive immediate and substantial value, with the offer representing a very significant premium over recent trading prices. Our customers gain from the broadened product offerings and combined technology resources of the two organizations, and our employees benefit from the enhanced opportunities in an organization poised to address a broad spectrum of industry and subscriber needs."

Mullaney continued, "We believe that the combined organization offers bcgi considerable growth opportunities that would be difficult to achieve without the synergies that exist between the two companies. A standalone strategy for bcgi would require the development of new revenue streams to replace the decline in business from some of our tier one carrier customers, which could result in future losses. We believe that Megasoft's offer to purchase bcgi shares at a substantial premium over current market prices is a more favorable and certain outcome for our shareholders."

"This transaction creates significant value for Megasoft shareholders and expands our market and technology leadership in what is one of the most exciting areas of our industry's transformation: convergent telecom," said GV Kumar, CEO and managing director of Megasoft. "Megasoft and bcgi link technology with services, thereby creating an exceptional platform to add next-generation, high-value products and strategically position the company for future growth."

Megasoft Ltd.

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