Kontron to Acquire US-based ICS Advent and Become World Leader in Embedded Computer Market

Montreal (Canada), October 26, 2001 -- Kontron Embedded Computers AG, a leading supplier of embedded computer solutions and custom-engineering services, announced that it has reached an agreement to acquire 100% of US-based ICS Advent in an all cash transaction.

With ICS Advent, Kontron gains ICS Advents Industrial Computer Source brand - one of the most recognized in the embedded and industrial PC industry, a significant North American presence, and ICS Advents strength in industrial computers/PC servers and platform-level systems integration.

The acquisition will make Kontron the world leader in the embedded computer merchant market and one of the three largest suppliers of the broader embedded, industrial and specialty computing systems markets. These markets represent a nearly $6 billion opportunity, according to technology market research and consulting firm Venture Development Corporation (VDC).

"This move positions Kontron as a solid global leader," stated Pierre McMaster, Kontron Americas Chairman. "With the addition of ICS Advent, Kontron will be able to offer customers one of the richest product portfolios in the industry. Additionally, we will offer ever-higher levels of integration services, middleware support and value-added vertical market applications. Quite simply, Kontron rises well above the competition in its ability to develop technology, deliver solutions, and service customers on a global scale."

Kontron expects the integration of ICS Advent into the Kontron organization to drive cost savings of $5 to $10 million (US) during the first year of combined operation in 2002. The synergies are expected to positively impact every facet of the combined companies operations. The impact on bookings and revenue opportunities may be even more powerful as each companies customers will now be able to source a broader range of highly interdependent products and services from a single, global source.

"Kontron worked diligently - and successfully - over the previous several quarters to ensure that the company remains prepared to control expenses in ongoing operations, and aggressively target strategic acquisitions," stated Kontron CEO, Hannes Niederhauser. "We will execute this two-part strategy by maintaining high liquidity and upholding positive cash flow."

The ICS Advent acquisition underscores a decisive phase in Kontrons quest to continue to lead the embedded computer marketplace. The deal is expected to close November 2, 2001 and precedes additional acquisition opportunities that Kontron is pursuing - specifically small and mid-sized companies participating in the embedded/specialty computers systems and IP telephony solutions markets.

About Kontron
Kontron is the leading global embedded computer technology company. Kontron supplies a diversified customer base of OEMs, system integrators and application providers in the communications, automation, transportation, medical, military, aerospace, test and measurement, and encryption security markets. The company helps its customers to considerably reduce their time-to-market and to gain a competitive advantage with products including high-performance open computer platforms and systems, single-board computers, man-machine interfaces and mobile computers. Kontron employs 900 people worldwide and has manufacturing facilities in Europe, North America and Asia Pacific. The company is listed on the German Neuer Markt stock exchange under the symbol "KBC."

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