Techstep ASA — M&A Activity 2010

Jul 5, 2010

Sale of Raima Inc

Oslo, Norway and Seattle Washington USA, July 2 2010,

Birdstep Technology ASA (OSE: BIRD) and Raima Holding

Company LLC announced today that they have signed a

share purchase agreement where Birdstep Technology

ASA's US Subsidiary (100%) Raima Inc is sold to Raima

holding Company LLC, a newly established company owned

by the current management of Raima.

Raima had sales in 2009 of NOK 18 800 000 and an

EBITDA loss of 3 665 000.

- This spin off follows the Group's strategic decision

in late 2009 to focus on the core growth areas of

EasyConnect and SafeMove. By eliminating the risk of

further negative contribution to operating result, we

expect the Group to be able to reach a profitable run

rate at an earlier point in time, says Torbjørn

Sandberg, CEO in Birdstep Technology ASA.

Transaction summary:

The purchase price for the shares is USD 637 354 of

which USD 403 589 will be received immediately and USD

233 765 in sellers note will be paid down with equal

installments and accrued interest over 2 years and 6

months at an annual interest of 7%.

The transaction is expected to close before mid July

2010. Raima will be classified as asset held for sale

in Q2 2010 and up to the effective closing date in Q3

2010. In these periods the net result of Raima will be

presented as result of discontinued operations in the

consolidated Group income statement.

The total cost of the transaction is estimated to be

in the order of NOK 700 000 and the net effect on the

Group Income statement in Q3 is estimated to be

immaterial, prior to recording any effects of IAS 21-48.

The immediate cash flow effect of the transaction in

Q3 2010 is estimated to be NOK -400 000, turning to a

positive cash flow effect of NOK 1 000 000 as the

sellers note is amortized. Total goodwill amounting to

NOK 5 800 000 relating to the acquisition of Raima in

2001 will be written down in Q2 2010 with no effect on

Group EBITDA or cash flow. The transaction is expected

to have no payable tax effect for the Group.

For further information, please contact

Torbjörn Sandberg

CEO in Birdstep Technology ASA

+46 70 5170964

Torbjorn.Sandberg@birdstep.com

Alex Gundersen

CFO in Birdstep Technology ASA

+47 41 474107

Alex.Gundersen@birdstep.com

About Birdstep

Birdstep Technology ASA is a leading provider of

secure and seamless wireless connectivity software for

operators, enterprises and mobile device

manufacturers. EasyConnect offers advanced connection

and service management solutions for network operators

and laptop manufacturers. SafeMove is a mobile VPN

solution providing seamless and secure

connectivity to business data for corporations and

governments.

Birdstep Technology was founded in 1996 and is since

2002 listed on the Oslo Stock Exchange under the

ticker "BIRD". The company has 100 employees and is

headquartered in Oslo, Norway, with competence centres

in Sweden, Finland, UK and the United States. For more

information, visit www.birdstep.com.