Nera ASA receives an equity ownership of 40 percent in Thrane & Thrane and a cash settlement of DKK 235 million. Nera receives its shares in Thrane & Thrane through a private placing towards Nera.

Nera ASA and Thrane & Thrane have entered into an agreement in which the Danish company acquires Nera's satellite communications division -- Nera SatCom AS and Nera WBA Satellite AS. Nera receives shares in Thrane & Thrane as payment, corresponding to a 40 percent ownership in the combined company, in addition to a cash settlement of DKK 235 million.

The agreement is subject to approval from Nera's corporate assembly as well as Norwegian authorities and Thrane & Thrane's general meeting. The agreement is also subject to mutual satisfactory due-diligence.

The agreement will contribute to further strengthen the position of the Nordic satellite communications environment globally. The new company will become the world's largest supplier of mobile satellite communications equipment, with highly skilled research departments for satellite broadband development.

"We are very satisfied with having contributed to the establishment of a larger and more powerful unit within satellite communications, to the benefit of our customers. The agreement is a foundation for a more future oriented business with several opportunities for our employees," says CEO of Nera Bjorn Ove Skjeie.

Thrane & Thrane and Nera SatCom have strong and complementary positions within the mobile satellite communications market. The merged company will have a turnover of about NOK 1,2 billion, and 580 employees of which 255 in R&D.

As for Inmarsat, Thrane & Thrane has entered into an agreement on equipment development for the next generation of satellites (Inmarsat 4), while Nera has entered into an agreement with ShinSat on supply of equipment developed for broadband communication over satellite, and have developed equipment for DVB-RCS. Based on these programs the merged company will further develop a strengthened position within broadband via satellite.

In addition to strengthened market positions, the merger is expected to generate considerable synergies. Accumulated synergies are estimated to be around NOK 50 million per year. Thus, the merged company should achieve significantly improved profitability.

In connection with the transaction a shareholder agreement has been made between the largest shareholders of Thrane & Thrane, Mr. Lars Thrane and Mr. Per Thrane, and Nera ASA on board selections and ownership reductions.

In accordance with the shareholder agreement Nera is committed to reduce its ownership interests in the company to the combined level of Mr. Lars Thrane and Per Thrane (31%) under satisfactory market conditions.

The transaction is expected to contribute approximately NOK 425 million in profit for Nera ASA, based on today's market value of the shares the Company will receive. The transaction will enable Nera to focus its broadband activities towards terrestrial solutions.

The transaction implies a change of focus for the Nera Group both strategically and operationally, towards wireless terrestrial communications.

Through developing strong positions within wireless infrastructure and wireless access, and a global co-ordination of these areas, the company shall become a leading provider of wireless solutions from "switch to basestation" in mobile networks and from "switch to end user" in fixed networks.

"We see the transaction as a win-win agreement for both parties. Our financials are strengthened, and we may continue to strengthen our position within the business areas Networks and Wireless Broadband Access. "At the same time, we play an important role in establishing a considerably stronger business unit within satellite communications," says CEO of Nera Bjorn Ove Skjeie.

"Moreover, through our owning interest of 40 percent in the merged company, Nera secures a significant share of the value creation potential," says Skjeie.

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