ECsoft Group Strategic Divestment of Managed Support Services Business

Business Wire, Jan 26, 2001

Business Editors

LONDON--(BUSINESS WIRE)--Jan. 26, 2001

ECsoft Group plc ("ECsoft" or the "Company"; London: ECS, Nasdaq: ECSG) the independent E-business consultancy, systems integrator and IT solutions provider has today announced divestment of its Managed Support Services Business in the UK, simultaneous with signature of a strategic cooperation agreement with the purchaser, PinkRoccade NV.

Under the structure and terms of the deal, worth up to (pound)9 million in cash, the business assets and 120 employees of ECsoft's managed support services business will transfer on 1 March 2001 to Pink Elephant, PinkRoccade's UK subsidiary. ECsoft will receive an initial cash payment of (pound)4 million, with a further (pound)4.75 million available during the course of 2001, (of which (pound)4 million will be held in escrow).

ECsoft will initially continue to contract directly with its managed support services clients, outsourcing the related work to Pink Elephant. During the course of 2001, all client contracts will be passed across to Pink Elephant, on a timetable agreed between ECsoft, Pink Elephant and each client.

The cooperation agreement enables ECsoft to further develop and strengthen its solutions consultancy business, with future support services business managed by a specialist in this field, Pink Elephant. The two companies have jointly agreed a plan to ensure seamless transfer of the business and a smooth transition for ECsoft's 120 staff. Pink Elephant and ECsoft will be actively working together to ensure that they maximise the business benefits of the synergy between the two companies, as well as providing a high quality service to clients.

Commenting on this announcement, Jerry Ellis, Chief Executive and President of ECsoft Group plc, said: "Our UK managed support business had grown to a scale that warranted either significant further investment, or partnership with a company for whom this is a primary business activity. Today's agreement allows us to focus on building our own core business of IT solutions consultancy, while maintaining a quality managed support service, delivered via a business partner with significant strength in this area. In addition, the transaction proceeds will add to our existing cash reserves, in support of future IT solutions business acquisitions".

Henk Bosma, Managing Director of PinkRoccade says; "The acquisition of ECsoft's Managed Support Services Business, as part of our cooperation agreement, enables our UK subsidiary Pink Elephant to accelerate its growth in IT Infrastructure management and support services because now we can offer a solid and broad range of these services."

ECsoft Group plc (London: ECS; Nasdaq: ECSG) is an independent eBusiness consultancy, systems integrator and IT solutions provider, specialising in the development and delivery of innovative mission-critical business solutions. ECsoft's mission is to transform business vision into technical reality and it achieves this by investing in and exploiting innovative and emerging technologies, concepts and processes from around the world. ECsoft's customers include many of Europe's top 500 companies as well as start-ups, government and public organisations. Through its unique knowledge management framework, Practicology, ECsoft has a tried and tested method to rapidly liberate value--typically in a matter of weeks or months, not years. With offices in the UK, the Netherlands, Germany, and Scandinavia, ECsoft is a leader in the practical application of advanced technology. More information about ECsoft can be found at www.ecsoft.com

Pink Elephant is a member of the PinkRoccade NV Group. PinkRoccade is a large Information and Communications Technology (ICT) services company in Europe and is listed on the Amsterdam Stock Exchange. The group is headquartered in the Netherlands, has a revenue turnover in excess of (pound)400million and employs over 7,700 people. For further information please visit www.pinkroccade.com or www.pinkelephant.com

FORWARD LOOKING STATEMENTS: Statements contained in this release that are not historical facts may contain forward-looking information with respect to the plans, projections or future performance of the Company, the occurrence of which involve certain risks and uncertainties. Potential risks and uncertainties include, without limitation, continued competitive pressures in the market place; reliance on attracting and retaining technically skilled professional staff; successful integration of acquired companies; managing risks associated with customer projects; significant fluctuation in quarterly operating results; the Company's ability to manage its growth; dependence on trends towards open systems computing architecture and outsourcing; reliance on key executives; reliance on relationships with third parties; and the Company's ability to develop information technology solutions that keep pace with rapid and continuing changes in computing technology, evolving industry standards and changing customer preferences. More information on potential factors that could affect the Company's financial results are included in the Company's filings with the Securities and Exchange Commission, particularly in its Annual Report on Form 20-F.