Iomega Acquires Chinese Storage Vendor

December 17, 2007: In a bid to boost its product line, Iomega has announced that it will acquire the Chinese Government’s digital storage hardware specialist ExcelStor, the manufacturer of Iomega’s REV products.

ExcelStor designs, develops, manufactures hard disks, security storage and other external storage, including Iomega's REV products since 2004. ExcelStor is a subsidiary of Great Wall Technology Company Limited, which is itself owned by the Chinese Government’s China Electronics Corporation.

Iomega will be taking over both ExcelStor Great Wall Technology Limited, a Cayman Islands company, and Shenzhen ExcelStor Technology Limited, a PRC company, issuing around 84 million shares of its own common stock (worth approximately US$139 (AU$160) million) in exchange for all outstanding ExcelStor common shares.

When closed, the transaction will see GWT and its affiliates hold approximately 43 percent of Iomega's common stock, making GWT the largest Iomega shareholder.

In 2006 Excelstor recorded revenues of US$2.6 billion from the development and manufacturing of communication products, including computers and related components, portable terminals, software and systems integration, broadband networks and value-added system services. It was not disclosed what products will be added to Iomega’s product line at this time.

The deal is expected to close in 2008, and will effectively quadruple the size of Iomega. Until then, both companies will continue to operate their businesses independently. Afterwards ExcelStor is expected to operate as a wholly-owned subsidiary of Iomega.

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