Cambridge, UK -- March 13, 2006 - TTP Communications plc [LSE: TTC] today announces the conclusion of a financing round for its subsidiary, ip.access Limited ('ip.access'). A consortium led by Scottish Equity Partners [SEP], and including Intel Capital and Rothschild Gestion, has invested £8.5 million in ip.access. In line with TTP Communications' previously stated objectives, the new funds will finance the expansion of ip.access' current successful second-generation pico base-station business and the development of low cost third-generation access points for use in homes and small businesses. It is expected that the transaction will be completed within the next two weeks, at which time TTP Communications' shareholding in ip.access will be 47.5% (42.0% fully diluted). After completion, up to £2m further investment will be sought by ip.access which will be used by the company to re-purchase shares held by TTP Communications plc. If this repurchase goes ahead, TTP Communications' shareholding in ip.access will reduce to 36.5% (32.3% fully diluted).
Tony Milbourn, TTP Communications' Managing Director, commented: "ip.access' revenues have exceeded our original expectations this year and are poised to grow sharply again in the year ahead. Nonetheless, it became clear early last year that if the business was going to capitalise on the technology lead that our investment to date had given it, then it would need to extend its product range to cover 3G and for this additional investment would be required. The deal announced with SEP and its co-investors today will not only provide the investment needed, it will also allow the business to continue to progress through to profitability during the next twelve months. At the same time it will allow TTP Communications to focus on its core business of developing technology for wireless handsets. The new investors' track record of successful investment in this sector endorses our belief in the future of the ip.access business and gives us confidence that we can secure a satisfactory return on our investment for shareholders in the longer term."
Stephen Mallinson, ip.access' CEO, added: "We are delighted to welcome SEP, Intel and Rothschild to our shareholder base. The new investment will enable us to accelerate the development of our 3G Access Point to allow operators to cover homes and small businesses and provide converged fixed-mobile services at prices competitive with fixed-line services where people live and work. It also helps us to expand our GSM market, addressing new opportunities such as those opened up by the forthcoming auction of 1800 MHz spectrum in the UK."
Founded in 1999, ip.access produces and sells globally the world's smallest GSM base stations, designed to be deployed inside buildings to communicate with operator's infrastructure using standard broadband IP links. The company has enjoyed increasing success and its nanoGSM equipment is used by operators including T-Mobile USA, Telfort (Netherlands), Spring Mobil (Sweden), Smart (Philippines), and Eurotel in the Czech Republic. In 2004 the company signed a global Original Equipment Manufacturer (OEM) agreement to allow Siemens Mobile to distribute nanoGSM as part of its enterprise portfolio.
At 31 March 2005, the most recent statutory reporting date of ip.access Limited, the company reported gross assets of £4,699,000 and losses before tax for the year then ended of £4,593,000.
In the transaction, Strata Technology Partners and Taylor Wessing advised TTP Communications plc.