TELESTE BECOMES NUMBER ONE SERVICES PLAYER IN GERMAN CABLE NETWORK MARKET
TELESTE CORPORATION STOCK EXCHANGE RELEASE 1.7.2009 AT 08:00 TELESTE BECOMES NUMBER ONE SERVICES PLAYER IN GERMAN CABLE NETWORK MARKET Teleste Corporation has taken yet another step in its development of services business by acquiring a fourth services company in Germany, AVC Systemhaus GmbH, mainly specialising in upgrading and maintenance of cable and house networks. The company is primarily operational in the Berlin area and the Eastern part of Germany with its headquarters in the city of Cottbus. Former owners Hans-Joachim Dosdall, Michael Schumann and Steffen Kiessling continue in the company management. With this acquisition Teleste becomes the most significant technical service company in the German cable networks business. Its main clientele consists of German cable operators supplying cable network access to approximately 20 million end-customers. The acquired company provides services for the operators both directly and through the previously established affiliate company Cableway. With the acquisition Teleste Corporation's holding of Cableway will increase up to 62.5%. In the same connection Teleste made an agreement with the other owner of the company for purchasing its 12.5% share bringing Teleste's holding in Cableway up to 75%. Cableway provides comprehensive services for major German cable operators. As the single biggest cable network country in Europe, Germany constitutes strategically one of Teleste's most important market areas. In 2008, net sales of AVC Systemhaus GmbH stands at approximately EUR 10 million with its business profitability on a sound level. The impact of this acquisition to Teleste's net sales for 2009 is estimated to be approximately EUR five million. Moreover, with Teleste becoming the majority shareholder in Cableway the company will be consolidated into Teleste Corporation in its entirety. The additional impact of Cableway to Teleste's net sales in 2009 is estimated to approximately EUR four million. The acquisition of AVC is expected to improve Teleste's profitability for 2009, although it will have no significant impact on Teleste's equity ratio. Gearing will increase to some degree. Cableway will not have a significant impact on Teleste's result. Acquisition of AVC and the majority holding in Cableway will increase the number of Teleste personnel by 250. The contract price will not be disclosed by the parties. The transaction becomes effective on 1 July 2009. Side by side with its strong emphasis on product offering Teleste develops its technical network services provided for the operators. Teleste's strategy is to become the leading comprehensive technology and services partner to the cable operators. Founded in 1954 Teleste is an international technology group specialising in broadband data communication systems and solutions. The Group is divided into the following strategic Business Units: Customers of Broadband Cable Networks include cable operators and majority of the business is carried out through direct customer contacts. Video Networks supplies solutions involving optical signal transmission and video network management software solutions for video surveillance. Major part of its business is conducted through system integrators. Both Units are ranked among the leading providers in their respective market areas and are recognised globally for their know-how and ability to present technically cutting edge solutions on a continual basis. In 2008 the Group's net sales totalled EUR 109 million. At the year-end the Group employed on average 677 persons. The company runs about 30 offices worldwide and more than 90 % of Teleste's net sales are generated outside Finland. Teleste shares are listed on the NASDAQ OMX Helsinki Oy. For additional information access www.teleste.com TELESTE CORPORATION Jukka Rinnevaara CEO FOR MORE INFORMATION: CEO Jukka Rinnevaara, tel +358 2 2605 866 or +358 400 747 488 DISTRIBUTION: NASDAQ OMX Helsinki Primary media www.teleste.com