Techstep ASA — M&A Activity 2011

Jan 4, 2011

Birdstep Sells Service Factory AB (Orbyte) and Equity Stake in Aptilo Networks AB for a Gross Value of NOK 52 million

Oslo, Norway and Stockholm, Sweden, January 4, 2011:

Birdstep Technology ASA (OSE: BIRD) and Service

Factory AB ("Orbyte"), a wholly owned subsidiary in

Sweden, announced today that they have signed a share

purchase agreement where Orbyte is to be sold to

Aptilo Networks AB.

In addition, shareholders representing more than 90%

of all shares and votes in Aptilo Networks AB, a

Swedish affiliate which is 32.94% owned by Birdstep,

also signed a share purchase agreement where Aptilo is

to be sold to the Norwegian private equity firm

Norvestor V L.P.

"These divestments of non-core assets follow the

Group's decision to fully focus on the core growth

areas of EasyConnect and SafeMove", said Torbjörn

Sandberg, CEO in Birdstep Technology ASA.

Tom Nyman, Chairman of the Board, added "We're very

pleased that Birdstep has completed the sales of

Orbyte and Aptilo shares in one transaction. The gross

proceeds alone from these divestments for

approximately NOK 52 million represent NOK 0.73 per

share in value to our current stakeholders. This

transaction in combination with the number of new Easy

Connect customer deals in 2010 means that Birdstep is

in a good position going forward."

Summary of Transactions:

The purchase price for Orbyte is SEK 26 million in

cash upon closing before accounting for transaction

costs. There is also an earn-out provision which could

yield additional payments of SEK 8 million over the

next 12 months. The transaction is expected to close

on Tuesday, January 4, 2011 with effective control

transferring from Monday, January 3, 2011.

The purchase price for the shares in Aptilo is SEK

104.5 million. Accordingly, before accounting for

transaction costs, Birdstep will receive 32.94% of

such amount in cash upon closing. The transaction is

expected to close on Tuesday, January 4, 2011.

Before deducting amounts to be held in escrow and

transaction related costs, the gross cash flow effect

of these transaction upon closing is SEK 26 million

[approximately NOK 22.6 million] for the Orbyte

transaction and SEK 34.1 million [approximately NOK

29.6 million] for the Aptilo transaction.

There are no special conditions, terms, license issues

or approvals in connection with these transactions.

Also, there are no available agreements in connection

with the transactions that involve extraordinary

benefits for leading employees or board members in

Birdstep, Orbyte or Aptilo Networks AB.

Orbyte - Additional Information:

Orbyte allows network operators to rapidly deploy and

manage large networks with advanced features. It is

designed to allow simplified wireless broadband

connectivity for end users whilst allowing centralized

authentication, enabling businesses to on-sell

connectivity and taking advantage of existing

infrastructure deployments.

Currently Orbyte's Board of Directors consists of

Torbjörn Sandberg (Chairman), Maria Good, Torbjörn

Wård and Alexander Gundersen. Also, Orbyte has 14

employees.

Orbyte had sales of NOK 24.6 million in 2009 and NOK

19.2 million for the nine months ended September 30,

2010. In the consolidated Group balance sheet as of

Q3 2010, Orbyte was classified as assets held for sale

amounting to NOK 42.5 million, including goodwill of

NOK 18.6 million, and liabilities held for sale

amounting to NOK 4.1 million and will continue to be

classified in such way up to the effective closing

date. In these periods the net results of Orbyte are

being presented as results from discontinued

operations in the consolidated Group income statement.

Approximately NOK 16 million in goodwill relating to

the acquisition of Orbyte in 2007 will be written down

in Q4 2010 with no effect on the Group's adjusted

EBITDA or cash flow. The net effect on the

Group Income statement in Q1 2011 is estimated to be

immaterial, prior to recording any effects of IAS 21-

48. The transaction is expected to have no payable

tax effect for the Group.

In accordance with cf. the Continuing Obligations

section 3.4.2 of stock exchange listed companies, the

key figures for Orbyte for the previous three years

are set out below:

Orbyte's key figures (in millions):

2009 2008 2007

- Operating revenue NOK 24.6 NOK 31.0 NOK 18.9

- Operating result NOK 0.8 NOK (4.6) NOK 4.4

- Total assets NOK 43.4 NOK 58.2 NOK 106.7

Birdstep Technology ASA will issue an Information

Document regarding this transaction, cf. the

Continuing Obligations section 3.5 of stock exchange

listed companies section 3.5.

Aptilo - Additional Information:

Aptilo Networks is the global leader in pre-integrated

management solutions for control of billing, user

services and access in Wi-Fi, WiMAX and LTE networks.

Aptilo has become the provider of choice for service

providers, enterprises and municipalities in need of a

rapidly deployable, scalable service management and

policy control solution for wireless networks.

Currently Aptilo's Board of Directors consists of

Katarina Bonde (Chairman), Anders Ingeström, Torbjörn

Wård, Paul Mikkelsen and Torbjörn Sandberg. Also,

Aptilo has 45 employees.

In the consolidated Group balance sheet as of Q3 2010,

Aptilo was classified as investment in affiliated

company amounting to NOK 5.9 million and will continue

to be classified in such way up to the effective

closing date. In these periods, Birdstep's share of

gains(losses) in affiliated company (Aptilo) are being

presented as a separate line item in the consolidated

Group income statement.

Approximately NOK 23 million in goodwill relating to

the investment in Aptilo in 2004 was written off in

2008 thus reducing the book value of Birdstep's

investment to NOK 5.9 million. As a result of the

transaction, the net effect on the Group Income

statement in Q1 2011 is estimated to be a net gain on

the sale of approximately NOK 23 million, prior to

recording any effects of IAS 21-48. The transaction

is expected to have no payable tax effect for the

Group.

Aptilo had sales of SEK 44.3 million in 2009 and SEK

41.8 million for the nine months ended September 30,

2010. In accordance with cf. the Continuing

Obligations section 3.4.2 of stock exchange listed

companies, the key figures for Aptilo for the previous

three years are set out below:

Aptilo's key figures (in millions):

2009 2008 2007

- Operating revenue SEK 44.3 SEK 39.5 SEK 29.4

- Loss before taxes SEK (3.9) SEK (4.9) SEK (12.6)

- Total assets SEK 37.3 SEK 33.4 SEK 37.4

For further information, please contact:

Torbjörn Sandberg

CEO and President

Phone: +46 70 5170964

Email: torbjorn.sandberg@birdstep.com

André V. Demarest

CFO

Phone: +46 70 3928810

Email: andre.demarest@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 82 employees, including

Orbyte, and is headquartered in Oslo, Norway, with

competence centers in Sweden, Finland, UK and the

United States. For more information, visit

www.birdstep.com