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Latest NewsNovember 2007ST Electronics Enters Agreement To Acquire Telematics Wireless Ltd Singapore, 19 November 2007 — Singapore Technologies Electronics Limited (ST Electronics) has through its wholly-owned subsidiary, ST Electronics (Info-Comm Systems) Pte Ltd (STEE-InfoComm), entered into an agreement with Ituran Location & Control Ltd (Ituran) to acquire 93.96% of Telematics Wireless Ltd (Telematics) at a purchase consideration of approximately US$80m (about S$116m). Telematics, a subsidiary of NASDAQ-listed Ituran, was valued at an enterprise valuation of US$81.5m and an equity valuation of US$85m. The management and key employees of Telematics will retain the remaining shares in Telematics. STEE-InfoComm has also entered into a call and put option agreement with the management and key employees which allows STEE-InfoComm to acquire the remaining shares over a four-year period. The transaction is subject to customary regulatory approvals and other closing conditions. None of the directors of ST Engineering have any interest in the proposed transaction. These investment terms and the put and call option agreement were arrived at between STEE-InfoComm, Ituran and the management team and key employees of Telematics on a willing buyer, willing seller basis, taking into account Telematics’ past performance, current profitability and future prospects. This transaction will be financed by internal cash resources and debt. Assuming the transaction was completed on 1 January 2006, the acquisition would not have had any material impact on the consolidated earnings per share of ST Engineering for that year. Assuming that the acquisition of Telematics was completed on 31 December 2006, the consolidated net tangible assets per share of ST Engineering would have been reduced from 33.8 cents to 30.6 cents (Singapore currency). Telematics is a key player in the high growth Machine-to-Machine (M2M) industry in which machine assets are connected through wireless info-communication infrastructures to allow wireless transmission of information for remote monitoring and control. Telematics’ key solution offerings include products and solutions utilising wireless network technology for Radio Frequency Location and Vehicular Telematics, Automatic Meter Reading, and Radio Frequency Identification applications for Electronic Toll Collection and Asset Security. Telematics is currently amongst the largest terrestrial and urban asset location system suppliers worldwide with customers from Argentina, Brazil, China, Korea and USA. Its audited turnover for fiscal year ended 2006 was US$35m (about S$51m) and its audited earnings before interest, tax, depreciation and amortisation (EBITDA) was US$8.3m (about S$12m). The acquisition will enable ST Electronics to enhance its offerings by providing a full suite of telematics solutions to address customer and market needs. In addition, Telematics will provide a channel for ST Electronics to enter the emerging high growth markets for M2M applications and wireless telemetry. The combined capabilities of both companies will allow us to better address the needs of the global telematics market. ST Electronics has more than ten years of experience and in-depth expertise in providing Intelligent Transport System (ITS) solutions globally. It has jointly developed the award-winning i-Transport, an advanced integrated large-scale transport system, with the Singapore Land Transport Authority. It was also recently awarded a contract to provide Integrated Traffic Management and Security Systems for the Automated Traffic Violations Administering and Monitoring project by the Kingdom of Saudi Arabia. Over 30,000 vehicles and vessels worldwide have been equipped with its award-winning fleet telematics solutions. Some of these include ComfortDelGro, one of the largest taxi fleet owners in the world and Taiwan’s first large-scale, fully automated taxi despatch system.
Telematics Wireless Ltd, a subsidiary of NASDAQ-listed Ituran Location & Control Ltd, is engaged in the development of radio frequency technology and wireless solutions for the Machine-to-Machine (M2M) industry. Its major customers include location-based service providers for stolen vehicle recovery and fleet management, utility meter manufacturers, as well as electronic toll system providers and road toll operators. ST Electronics (Info-Comm Systems) is a wholly-owned subsidiary of Singapore Technologies Electronics Limited. It is a leading solutions house in the Asia Pacific region for infocommunications, advanced electronics and intelligent transportation businesses. From design and development to production, system integration, maintenance and enhancement, it has become a one-stop solutions house and a strong partner for its commercial, government, defence and homeland security customers worldwide. Its core business areas include emergency response and integrated security & surveillance systems, e-Government infocommunication and enterprise solutions, intelligent traffic and advanced fleet management systems, infocommunication security products and solutions, and managed operations services. ST Electronics, the electronics arm of ST Engineering, delivers innovative system solutions to government, commercial, defence, and industrial customers worldwide. It specialises in the design, development and integration of advanced electronics and communications systems, such as broadband radio frequency and satellite communication, e-Government solutions, information communications technologies and IT, rail and traffic management, real-time command & control, training and simulation, intelligent building management, and information security and mobile commerce solutions. Please visit www.stee.stengg.com. ST Engineering is an integrated engineering group providing solutions and services in the aerospace, electronics, land systems and marine sectors. Headquartered in Singapore, the Group reported revenues of $4.49b in FY2006. With a market capitalisation of over $11b, it ranks among the largest companies listed on the Singapore Exchange. ST Engineering has more than 18,000 employees worldwide, and over 100 subsidiaries and associated companies in 20 countries and 35 cities. Please visit www.stengg.com. Media contact:Magdalen Loh
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ST Electronics has a strong position and presence in the global ITS marketplace. The acquisition of Telematics will immediately place ST Electronics among the top three global ITS players. We will be able to offer a full suite of ITS end-to-end systems solutions and services to our customers worldwide. Telematics, on the other hand, will be able to leverage our network and related IP for further growth. The acquisition will benefit both companies and will develop our ITS business further.
SEAH Moon Ming,
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