$74.5 million acquisition of ADC Telecommunications’ ‘Singl.eView’ billing software division

4 June 2004 - Intec Telecom Systems PLC is pleased to announce that it has conditionally agreed with ADC Telecommunications, Inc. ("ADC") to acquire its 'Singl.eView' retail billing software division for $74.5 million (the “Acquisition”).

Consideration of $74.5 million (subject to potential adjustment) to be satisfied as to $71 million by vendor placing of Intec shares and as to $3.5 million from cash resources

The Acquisition is expected to be earnings enhancing in the first full year of ownership (to 30 September 2005) and to substantially increase revenues

The Acquisition is to be part-financed by a vendor placing of approximately 60.4 million Intec shares to existing shareholder General Atlantic Partners (“GA”), increasing its holding to approximately 25.6%

The Acquisition is subject to Intec shareholders’ approval at an EGM. Shareholders should expect to receive a circular relating to the Acquisition in July 2004

Rationale for the acquisition:

• Allows Intec to enter the largest sector in the Operations Support Systems ("OSS") market - retail or customer transaction billing
• The retail billing market is approximately the same size as all other sectors of the OSS industry put together
• Contracts for retail billing are typically 5-10 times larger than for Intec’s current main markets of mediation and interconnect
• Singl.eView product line is widely reported to be one of the top retail billing solutions available
• Singl.eView has over 70 Tier 1 and Tier 2 carrier clients in 17 countries, including Deutsche Telekom, Virgin Mobile, Hutchison 3G, Optus, and Reliance.

Commenting on the Acquisition, Intec Executive Chairman, Mike Frayne, said: "This acquisition will place us in the top tier of global OSS vendors, with the scale, customer base and product set to compete on equal terms for the largest billing and OSS contracts in the market. Intec currently has strong contract momentum in its core OSS business, and the acquisition of one of the industry’s most recognised retail billing companies will increase our presence in the largest, most influential telecoms software market."

Intec CEO, Kevin Adams, added: "As a consequence of this transaction, Intec will be a leading OSS products company with over 450 customers and 600 installations, and a broad, technically advanced OSS product offering. Singl.eView is an award-winning product that fits logically into our current OSS architecture and allows us to substantially broaden our offering to customers worldwide."

Background to and reason for the Acquisition
Intec has a published, long-term strategy to increase performance and shareholder value through both organic growth and carefully managed acquisitions, and to execute a company transforming acquisition. Since its IPO in 2000, Intec has completed eight acquisitions which have both consolidated and extended Intec’s product line or market presence. Intec has developed a strong product offering in its first sector of operations, interconnect billing, with over 200 customers worldwide. Following the acquisition of convergent mediation provider, Computer Generation Inc. of Atlanta, in late 2000, Intec has also grown its mediation software business and this now has over 150 customers. Intec’s acquisition of Digiquant A/S of Denmark in late 2003 has now taken Intec into the technically advanced market space of IP billing and dynamic charging. These three OSS areas are complementary and Intec has sold two or more of these products to many customers.

The Board of Intec, having grown revenues to over £50 million in the year ended 30 September 2003, believes that the Company is well positioned to move the business strongly forward in recovering markets through acquisitions and organic growth. With leading products in billing mediation and inter-carrier billing, a logical next step for Intec is to enter the retail billing space. This is fully complementary to Intec’s existing products and is a critical business requirement that is frequently purchased by Communication Service Provider (“CSP”) customers at the same time as mediation or interconnect. Contracts for retail billing systems are typically 5-10 times larger than contracts for mediation or interconnect, and have substantial opportunities for value-added services. The Singl.eView product line from ADC is widely reported to be one of the top retail billing solutions available today and is considered by Intec to be an exceptionally good fit with its other business lines, global operations and existing customer base.

The Board has considered a number of other options for entering the retail billing market, including developing its own product internally over a period of time or acquiring a relatively unknown solution and building its capabilities and presence organically. Neither of these options is considered to be ideal in comparison to rapidly acquiring a market-proven solution with a strong market presence, existing customer base and revenue stream.

The Board of Intec believes that the Acquisition is an important opportunity for the Company to deliver on its stated long-term strategy of good-value acquisitions of complementary OSS product businesses. Specifically the Board believes that the Acquisition will provide Intec with:

• A technically strong, market-proven retail/transactional billing system which has been the subject of a sustained, high level of investment in recent periods and is able to address all present and foreseeable market requirements in its current form;
• Additional capabilities, presence and scale to address the most demanding Tier 1 carrier requirements for OSS technology;
• Immediate high-level entrance to the important OSS market of retail billing/transaction management;
• Ownership of an award-winning product suite built with modern technologies, which is proven to be interoperable in customer sites with existing Intec offerings;
• Substantially increased revenues for the enlarged group: based on unaudited financial statements for the two most recently reported quarters, annualised revenues for the combined group would increase by over 50% on a pro forma basis;
• Over 70 Tier 1 and Tier 2 carrier clients in 17 countries;
• The opportunity to cross-sell both Singl.eView and Intec OSS products to current customers of both companies. More than ten high-profile clients currently operate both Singl.eView and Intec products together;
• An experienced and proven management and professional staff team of over 640 people with excellent skills in developing, selling and implementing complex, high-value retail billing systems worldwide;

A greatly enlarged professional services team giving Intec a much increased ability to implement large OSS projects on a global basis. Singl.eView currently has over 400 professional services staff compared to around 250 in Intec;

Productive relationships with several key integrators in the telecoms business, including Accenture, IBM and EDS; and Offices in a combined total of 27 locations which will increase Intec’s distribution and delivery capabilities to some important markets, including North America and Australia.

Transaction structure
Intec Telecom Systems PLC has conditionally agreed with ADC to acquire its 'Singl.eView ' billing software division for $74.5 million (subject to a potential adjustment based on the working capital and deferred revenue position at completion). The Acquisition is conditional upon the approval of Intec’s shareholders, the completion of the audit of SingleView’s accounts for the three years ended 31 October 2003, customary anti-trust clearances under applicable regulations, and the admission of vendor placing shares in Intec (the "Vendor Placing Shares") to the Official List of the UK Listing Authority and to trading on the London Stock Exchange's market for listed securities (“Admission”).

To facilitate the acquisition, Intec has today entered into a vendor placing agreement with GA pursuant to which it has conditionally agreed to place approximately 60.4 million new Intec shares with GA and its affiliates (the “GA Entities”) in consideration for GA agreeing to procure the payment of $71 million in cash to ADC. Notwithstanding the dilutive effect of the vendor placing, the full Board of Intec, after very careful consideration of this and other options, considers this method of financing to be in the best interest of shareholders. GA is a leading global direct investment firm and, through certain GA Entities, an existing investor in Intec. The number of new Intec shares placed with GA has been determined by reference to the average closing price of Intec shares over the five business days ending on 3 June 2004. The $3.5 million balance of the purchase price will be met from Intec's existing cash resources.

The acquisition was run by ADC as an auction process. Intec was one of a number of interested bidders. It was clear that in order to compete effectively in the auction process, Intec's offer for Singl.eView needed to be made in cash. Furthermore, due to ADC's requirement that the transaction, could not be conditional on financing, it was not possible for Intec to raise capital through the public markets. Intec therefore approached GA to assist with the bid for Singl.eView .

Unlike a traditional underwriting agreement, the vendor placing agreement is conditional only upon the completion of the Acquisition and Admission and, therefore, ADC is not directly exposed to external market risk in relation to the transaction. In addition, since the number of new Intec shares placed with GA has been fixed, Intec is not exposed to fluctuations in its share price between now and completion of the Acquisition. Therefore there is also no risk of further dilution for Intec's shareholders.

The aggregate shareholding of GA Entities in Intec following completion of the vendor placing will be approximately 25.6% of the enlarged issued share capital. In recognition of the size of its holding in Intec, with effect from completion GA has been granted the right to appoint a non-executive director to the board of Intec.

The Company will issue a shareholder circular and prospectus (the “Prospectus”) containing further details of the Acquisition in the summer of 2004. Due to its size in relation to Intec, the Acquisition is conditional on the approval of Intec shareholders which will be sought at an extraordinary general meeting this summer (the “EGM”). Irrevocable undertakings to vote in favor of the Acquisition at the EGM have been received from shareholders holding over 40% of the existing issued ordinary share capital of Intec.

René Kern, a General Partner at GA and prospective director of Intec said, "We are delighted to increase our ownership in Intec significantly. Intec has established a strong track record of growth in a challenging market environment. As the telecommunications industry rebounds, Intec is well-positioned in providing mission critical software applications to the telecommunications sector. We have confidence in management's ability to integrate the Singl.eView business rapidly and look forward to supporting management in their continued plans for growth."

Financial effects of the Acquisition
There are a number of areas where synergies and improvements, in terms of both enhanced business performance and reduced costs, could be achieved under Intec’s ownership. In the area of improved business performance, the opportunity for the enlarged business to sell a wider product set to both existing and prospective customers is evident, as well as the ability to use the strong distribution channel partnerships that each business has created. In addition, the major sales and support locations of the two companies, for example Intec in Europe, Central and Latin America, and Singl.eView in Canada, are generally not duplicated, allowing the possibility of a stronger sales presence in markets where the existing businesses are not historically well represented. Potential cost savings are expected to result from integration of some functions, the removal of duplication in some budget items, for example office space, IT facilities or trade shows, and the more efficient allocation and thus utilisation of resources around the enlarged business.

Whilst the Singl.eView division, in common with many OSS companies, has experienced some decline in revenues in the past two years as a result of the challenging market conditions in the telecommunications sector, these reductions have been modest in comparison to many businesses. The Intec directors also believe that the sale process and consequent uncertainty around the ownership of the business has contributed to the pressure on Singl.eView’s revenues in recent periods. A full audit of the Singl.eView division of ADC is now underway and is expected to be completed early in the summer. Details of the audited accounts will be provided in the Prospectus to be circulated to shareholders. The Directors of Intec believe that Intec, as a highly focused vendor within the OSS space, will be able to provide the leadership, stability and management attention that the Singl.eView business requires.

Considering these factors, the Intec directors expect the Acquisition to be earnings enhancing in the first full financial year of ownership (to 30 September 2005). This statement should not be interpreted to mean that Intec’s earnings per share in the first full financial year following the Acquisition, or in any subsequent period, would necessarily match or be greater than those for the relevant preceding financial period.

Completion of the Acquisition is anticipated to be in the late summer of 2004 and therefore Singl.eView is not expected to make a substantial contribution to Intec’s results for the year ending 30 September 2004.

The retail billing market
According to industry analysts Frost & Sullivan, the market for retail billing systems is estimated to be worth approximately $6.5 billion, with a compound annual growth rate (“CAGR”) of 5.1% in the period 2002-2008. This market size includes both software-related revenues and bill processing/service outsourcing revenues. The market for software alone is reported to be approximately $1.6 billion (Source: Frost & Sullivan - World Communications Billing Software Market, May 2003), with an estimated CAGR of 9.7% 2002-2008. The retail billing market grew rapidly in the pre-2000 period but has shown a marked decline since then with the well known difficulties experienced by many CSPs. In 2004, the directors of Intec believe that the market has stabilized at a lower level and is likely to return to growth in coming quarters.

Intec has shown sequential year-on-year growth since it was founded in 1997, despite the overall decline in OSS spending in the period 2001-2004. Whilst Singl.eView has shown a reduction in revenues from 2002 to 2003, this is partly due to the overall industry decline, but in recent periods is most likely due to the uncertainty surrounding the disposal of the business and the lack of focus on billing systems within the much larger ADC corporate organisation during a very challenging period for the OSS and hardware markets. The Board of Intec believes that Singl.eView’s financial performance can quickly be stabilized under Intec’s ownership and that the market synergies and Intec focus can deliver improved performance in future periods.

Further Terms of the Acquisition relating to completion, consideration adjustment, share disposals and GA involvement
Completion of the Acquisition is conditional, amongst other things, upon receipt of an audit report reasonably acceptable to Intec covering Singl.eView for the three years ended 31 October 2003, upon customary clearances under applicable US, German and Canadian anti-trust regulations, and the admission of the Vendor Placing Shares to the Official List of the UK Listing Authority and to trading on the London Stock Exchange's market for listed securities (“Admission”). It is also a condition to the Acquisition that ADC provide Intec with an 18 month credit facility of up to $6 million at the prime lending rate and that, for a six month period following completion, ADC provides various centralised services and assistance on a transitional basis. The Acquisition purchase price is subject to a cash adjustment mechanism to the extent that the working capital of Singl.eView at completion of the acquisition differs from an agreed target. The Acquisition agreement contains customary representations, warranties and indemnities in favor of Intec.

The vendor placing agreement contains restrictions on the ability of the GA Entities to dispose of the Vendor Placing Shares following completion of the Acquisition. For the first year, no shares may be disposed of except in limited circumstances relating principally to a reorganisation of Intec's share capital or in acceptance of a general offer for all of Intec's shares. For a further 12 months beyond the initial period, the GA Entities are obliged to comply with certain restrictions as to procedure and price of any disposals in order to maintain an orderly market in Intec's shares.

GA has also entered into a relationship agreement with Intec to ensure that the GA Entities do not take any action which prejudices the general body of shareholders of Intec. The agreement contains a standstill provision prohibiting the GA Entities from making or soliciting an offer for Intec's shares or increasing their stake in Intec above 30% without the consent of the board of directors of Intec. It is also a term of the relationship agreement that, whilst it holds more than 10% of Intec, GA will have an ongoing right to nominate one non-executive to be appointed to the board of Intec.

René Kern, a General Partner at GA, will therefore become an Intec director upon completion of the Acquisition. Mr Kern or any replacement director nominated by GA will retire and be subject to re-election at the annual general meeting of Intec (the “AGM”) following their initial appointment and, if the relevant GA nominee is not elected, GA will be able to nominate another person to be a director of Intec who the board of Intec shall appoint until the next AGM. René M. Kern is a General Partner at General Atlantic Partners, LLC, a global private equity firm which manages approximately $6 billion in assets. Mr. Kern is currently responsible for GA’s worldwide investment activities in the telecommunications sector and is involved with leading technology and IT services companies in the wireline and wireless markets. Between 1996 and 2002, Mr. Kern headed GA’s European offices, leading several new investments and building a team of senior professionals and advisors. He is also a member of General Atlantic’s Investment Portfolio Committee after serving on GA’s Investment committee for several years.

Mr. Kern joined General Atlantic after six years with Morgan Stanley in New York and London, where he was a Vice President in the Investment Banking Division. Prior to Morgan Stanley, Mr. Kern was a management consultant with Bain & Company in Boston, MA. Mr. Kern is a graduate of the University of Pennsylvania, where he obtained an MBA from the Wharton School and an MA from the School of Arts and Sciences, and is a fellow of the Lauder Institute. He received his Bachelor of Science degree from the University of California, Berkeley.

Information About Singl.eView
Singl.eView resulted from ADC's acquisition of Saville Systems in October 1999 and is currently one of two principal software groups within ADC’s Software Systems division. Singl.eView develops, sells and supports the Singl.eView line of transaction management/retail billing products. ADC is NASDAQ listed with its headquarters in Eden Prairie, Minnesota, USA and supplies network equipment, software solutions, and integration services for broadband, multi-service networks that deliver data, video, and voice communications over telephone, cable television, Internet, broadcast, wireless, and enterprise networks.

Singl.eView is a comprehensive revenue, transaction, billing and service management solution, typically sitting at the core of the OSS and business support systems (“BSS”) architecture of a telecoms carrier. (It is also in use by a small number of non-telecoms enterprise and government customers for billing purposes). Singl.eView comprises a number of functional modules which are used singly or in conjunction with each other to provide transaction management, billing, customer care and other functions required by almost all telecoms companies.

Singl.eView currently has over 70 active customers in 17 countries. The majority are larger (Tier 1 or large Tier 2) communications service providers. The Singl.eView division has recently won a number of awards for its products and customer installations, including the prestigious ‘Best Overall Contribution to Billing’, ‘Best Billing Implementation – Telecoms’ and ‘Best Billing Implementation – Utilities’ at the 2004 Global Billing Awards in London. It was also the most recognised retail billing brand in a recent industry awareness survey. Major Singl.eView clients include Virgin Mobile, Hutchison 3G, Optus, and Reliance.

The Acquisition agreement covers all of ADC’s intellectual property rights pertaining to the product; customer licence, service, and support contracts; bill processing facilities and outsourced processing contracts for a small number of customers; certain tangible fixed assets essential to the business; a professional staff currently standing at over 600 people; and leases on offices located in Brisbane, Australia; Edmonton, Canada; Boston, USA; and Galway, Ireland.

Information About Intec Telecom Systems
Intec Telecom Systems is a leading OSS product vendor for fixed, mobile and next-generation networks (i.e. WLAN, 3G and IP), with more than 570 installations of its products worldwide in 400 customers. Founded in 1997, Intec was listed on the London Stock Exchange in June 2000. Intec has a strong position in the provision of inter-carrier billing systems and convergent mediation software, and has recently acquired a capability in IP billing and real-time mobile service charging and control. For the year ended 30 September 2003, Intec reported revenues of £50.7 million, with adjusted net earnings after tax of £4.1 million.

Intec’s product portfolio includes:
Inter-mediatE™ - convergent telecom billing mediation solution;
InterconnecT™ - interconnect and billing including US CABS and ITU-based settlement;
Inter-activatE™ - flow-through provisioning and service activation;
Intec CPM™ - end-to-end content partner management; and
Intec DCP™ (Dynamic Charging Platform) – a real-time pre/post-paid charging interface between the network and the back office.
InterconnecT OR Least Cost Routing - Optimal Least Cost Routing for effective interconnect cost reduction

Intec’s customer base includes, among others, BellSouth, BellSouth Peru, Brazil Telecom, Cable & Wireless, Cesky Telecom (Czech Republic), China Unicom, COLT Telecommunications, EBT (Taiwan), Eircom (Ireland), France Telecom, Hutchison 3G, Maxis (Malaysia), Nitel (Nigeria), Reliance (India), Singtel Optus (Australia), O2 Ireland, Orange, Telecom Argentina, Telecom Egypt, Telecom Italia, Tiscali, TPSA (Poland), Swisscom, T-Mobile International, Telefonica, Telia (Sweden), Telkom South Africa, Telstra, US Cellular, Westel (Hungary), Vodafone, VimpelCom (Russia), Vivo (Brasil) and Verizon.

On 12 May 2004 Intec reported its Interim (half year) results for the six months to 31 March 2004. The report stated that: “A combination of strong new licence sales across Intec’s main product lines, increased revenues from both professional services and recurring business, and generally improved trading conditions in the telecoms sector have driven a 41% increase in turnover and an increase in adjusted earnings per share of 130%. Trading conditions continue to be healthy, and providing these remain stable the Board is confident of satisfying full year expectations. In addition the Company is engaged in several major opportunities which, should they conclude and be recognizable in the current year, will enhance Intec’s financial performance for the full year.” Further details can be found in the full Interim statement at www.intec-telecom-systems.com

Information About General Atlantic Partners
General Atlantic Partners, LLC, is one of the world's leading direct investment firms focused on investing globally in companies providing or using IT in ways that significantly transform the value proposition. GA's investment focus in IT includes providers of IT, IT-related services and users of IT in traditional industries such as healthcare, finance and government. The firm was founded in 1980 and has almost $6 billion in capital under management. General Atlantic has invested in over 130 IT companies and has current holdings in over 50 companies, of which almost one-third are based outside the United States. General Atlantic’s portfolio companies include Archipelago, Digital China, Eclipsys, Exult, iSoft Group, Liberata, Open Text Corporation, Patni Computer Systems, ProxyMed, SESA, SRA International, Upromise, Xchanging and Zagat. The firm is distinguished within the investment community by its deep experience and expertise in information technology, its global perspective and worldwide presence, its long-term approach to investments, and its commitment to provide sustained strategic assistance for its portfolio companies. General Atlantic has nearly 70 professionals among its 130 employees worldwide with offices in Greenwich, New York, Palo Alto, Washington, D.C., London, Düsseldorf, Singapore, Tokyo, Mumbai, Hong Kong, and São Paulo. See www.gapartners.com for additional information.