QSC AG

M&A Activity • Apr 2, 2007

News Details

Ad-hoc | 2 April 2007 19:30

QSC and Broadnet agree on exchange ratio

QSC AG / Agreement

Release of an Ad hoc announcement according to § 15 WpHG, transmitted by
DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.

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Ad hoc release

QSC and Broadnet agree on exchange ratio

Cologne, April 2, 2007. Today, the Supervisory Boards of QSC AG, Cologne,
(ISIN DE0005137004 und ISIN DE000A0JQ4T8) and Broadnet AG, Hamburg, (ISIN
DE0005490866) have approved a definitive agreement on the merger of
Broadnet AG into QSC AG and the exchange ratio of shares. Accordingly,
Broadnet shareholders will receive 12 QSC shares for 11 Broadnet shares.

The exchange ratio was determined on the basis of the company valuations
conducted by both companies, with the assistance of IVA VALUATION &
ADVISORY AG Wirtschaftsprüfungsgesellschaft, Frankfurt/Main. The valuations
also considered the relevance of publicly quoted stock prices for both
companies. The equity value (Unternehmenswert) was conducted on the basis
of the applicable discounted earnings method (Ertragswertverfahren). The
determined equity value amounts to € 5.28 per share for Broadnet AG, and to
€ 6.06 per share for QSC AG. However, the weighted average stock-exchange
price during a period of 3 months before the announcement of the intention
to merge on January 30, 2007, (according to sec. 5 para. 1
WpÜG-Angebotsverordnung) amounts to € 6.61 per share for Broadnet AG, and
to € 5.18 per share for QSC AG. QSC AG und Broadnet AG have decided to
incorporate the respectively higher amount for each of the participating
companies into the exchange ratio, consequently € 6.61 per share for
Broadnet AG and € 6.06 per share for QSC AG, in order to ensure the
adequacy for both companies and their respective shareholders.

The adequacy of the exchange ratio has been approved today by the
court-appointed joint merger auditor, PricewaterhouseCoopers AG
Wirtschaftsprüfungsgesellschaft, Frankfurt/Main, today. The shareholders of
Broadnet AG will vote on the draft of the merger agreement at the annual
general meeting on May 23, 2007.

Queries to:
QSC AG
Arne Thull
Investor Relations
Fon: +49(0)221-6698-724
Fax: +49(0)221-6698-009
E-mail: invest@qsc.de

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Information and Explaination of the Issuer to this News:

Important disclaimer:

The calculation of a company valuation on the basis of the discounted
earnings methodology (Ertragswertmethode) is a highly complex process and
is not necessarily susceptible to partial analysis or summary description.
The analyses performed by the management boards with the assistance of IVA
VALUATION & ADVISORY AG Wirtschaftsprüfungsgesellschaft, Frankfurt a.M.,
are not necessarily indicative of future results or actual values derived
in accordance with other valuation methodologies, which may be
significantly more or less favorable than those expressed in this ad hoc
release. These analyses involved numerous judgments and assumptions with
regard to industry performance, general business, economic, competitive,
market and financial conditions, many of which are beyond the control of
the companies, as well as judgments and assumptions regarding 'risk-free
rates', 'beta factors', 'market risk premia' and 'typified shareholder
income tax rates', 'dividend payout rates', 'debt to equity ratios' and
'terminal values', all of which involved the exercise of discretion on the
part of management. Further information regarding the calculation of the
company valuations will be provided in the merger report and merger
auditor's report described above.

This ad hoc announcement contains forward-looking statements. These
forward-looking statements are based on current expectations and forecasts
of future events by the management of QSC AG, whereby QSC does not
necessarily intend to communicate changed expectations and forecasts. Due
to risks or mistaken assumptions, actual results may deviate substantially
from those made in such forward-looking statements. The assumptions that
may involve material deviations due to unforeseeable developments include,
but are not limited to, the demand for our products and services, the
competitive situation, the development, dissemination and technical
performance of DSL technology and its prices, the development and
dissemination of alternative broadband technologies and their respective
prices, changes in respect of telecommunications regulation, legislation
and adjudication, prices and timely availability of essential third-party
services and products, the timely development of additional marketable
value-added services, the ability to maintain and enlarge upon marketing
and distribution agreements and to conclude new marketing and distribution
agreements, the ability to obtain additional financing in the event that
management’s planning targets are not attained, the punctual and full
payment of outstanding debts by sales partners and resellers of QSC AG, and
the availability of sufficient skilled personnel.

Neither QSC AG nor Broadnet AG undertakes any responsibility to update such
forward-looking statements in light of future events or developments.

The statements on the company valuations on the basis of the discounted
earnings methodology do not constitute a forecast or assumption of the
future development of the market prices of shares of QSC AG or Broadnet AG.

DGAP 02.04.2007

Language: English
Issuer: QSC AG
Mathias-Brüggen-Straße 55
50829 Köln Deutschland
Phone: +49 (0)221 66 98-112
Fax: +49 (0)221 66 98-009
E-mail: invest@qsc.de
www: www.qsc.de
ISIN: DE0005137004
WKN: 513700
Indices: TecDAX
Listed: Geregelter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin-Bremen, Stuttgart, München, Düsseldorf

End of News DGAP News-Service

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