Statement by the board of directors of Teleca AB (publ) in relation to the offer from CayTel 1 L.P.

Press release 2 December 2008


Statement by the board of directors of Teleca AB (publ) in relation to the offer
from CayTel 1 L.P.

The board concludes that the offer from CayTel is not unfair

Background
This statement is made by the board of directors of Teleca AB (publ) (“Teleca”)
pursuant to section II.14 of the OMX Nordic Exchange Stockholm Takeover Rules.

On 31 October 2008, CayTel 1 L.P. (“CayTel”), a wholly owned subsidiary of
Symphony Technology Group LLC (“STG”), announced a cash offer for Teleca
pursuant to the mandatory bid rules (the “Offer”). CayTel offers SEK 3.25 in
cash per share in Teleca.

The Offer values Teleca at approximately SEK 250 million. It represents a
premium of (i) 23.6 per cent to the closing price of SEK 2.63 per Teleca share
on 30 October 2008, (ii) 45.7 per cent to the volume weighted average price of
the Teleca share over the last ten trading days up to and including 30 October
2008, and (iii) 44.4 per cent to the volume weighted average price of the Teleca
share over the last three months up to and including 30 October 2008.

Further, according to CayTel's offer document regarding the Offer, the following
applies: 

“The purchase agreements under which CayTel purchased Teleca shares immediately
prior to this announcement provide that the sellers of these shares will in
certain circumstances be compensated if CayTel sells the shares to a competing
bidder. Teleca shareholders who accept the Offer are therefore given the same
right to compensation. As a result, Teleca shareholders who accept the Offer
will be compensated if a competing public offer for Teleca is announced prior to
completion of the Offer and CayTel:
     1. accepts such competing offer in respect of shares tendered in the Offer,
or 
     2. sells shares tendered in the Offer to the competing bidder on or prior
to 30 April 2009. 
     As with the purchase agreements above, any compensation that CayTel will
pay to the Teleca shareholders is conditional on a transaction set out in item 1
and 2 above being completed and will in such case amount to 80 % of the
difference between the price per share received by CayTel and the price paid in
the Offer.”

On 14 September 2008, the Swedish Securities Council issued a statement
(2008:33), confirming that the consideration in the Offer does not need to be
adjusted to the price paid by CayTel in connection with acquisitions of Teleca
shares in the spring 2008 and that the consideration in the Offer therefore
shall be the highest price paid by CayTel in connection with purchases of Teleca
shares made thereafter. According to CayTel's offer document regarding the
Offer, CayTel has acquired additional shares in Teleca on 22 October 2008 at a
price lower than the price paid in respect of the purchases immediately prior to
the announcement of the Offer. According to CayTel, the price paid in respect of
the purchases of Teleca shares immediately prior to the announcement of the
Offer is equal to the offer price of SEK 3.25.

The Offer, being a mandatory bid, is conditional only on receipt of necessary
regulatory clearances, in each case on terms that in CayTel's opinion are
acceptable. Clearances from relevant competition authorities are required in
connection with the Offer.

CayTel has not requested the board of directors' participation in the
preparation of the Teleca section of the offer document regarding the Offer.
CayTel has, however, requested the board's assistance in connection with such
filings with relevant competition authorities as are necessary to satisfy to
above-mentioned condition to the Offer. The board of directors provides such
assistance to the extent deemed appropriate.

CayTel's offer document regarding the Offer contains the following statement:

“STG places great value in the work carried out by Teleca's management and
employees and intends to continue to protect Teleca's strong relationship with
its employees and customers. STG considers itself as a partner in Teleca's
development process. STG's intention is to remain a long term main owner in the
Company and on a continuous basis be involved in Teleca's restructuring process
in order for Teleca to become a company with strong growth and high
profitability.
     The Offer itself will not have a significant impact on employment terms or
employment at the locations where Teleca carries on its business. However, after
completion of the Offer CayTel intends to continue Teleca's transformation
process. This process may have an impact on employment terms and employment at
the locations where Teleca carries on its business. If redundancies are
necessary, STG will comply with the local laws and regulations and seek to
transfer employees as well as be in contact with the trade unions and other
employee representatives.”

The board of directors assumes that the above is correct and has no reason to
take a different view in the aforesaid respects.

The board of directors' view regarding the Offer

The board of directors has made an evaluation of factors and considerations that
the board has deemed relevant in relation to the Offer. These include, but are
not limited to, Teleca's current and estimated forward operating and financial
performance in a highly competitive environment, Teleca's position in a rapidly
changing and consolidating industry, other strategic alternatives available to
Teleca and its potential to make the necessary investments to increase its scale
and generate enhanced shareholder value on a stand-alone basis. The board has
also taken into account the risk of reduced liquidity in the Teleca share
following completion of the Offer.

Handelsbanken Corporate Finance has issued a fairness opinion to the board with
the opinion that, subject to the qualifications and assumptions therein, the
consideration offered by CayTel is fair from a financial point of view to the
shareholders in Teleca. The fairness opinion, which is attached hereto, should
be read in full to understand the limitations set out therein. Handelsbanken
Corporate Finance will receive a fee for its services, which is not contingent
on whether or not the Offer is consummated.

The last eighteen months, Teleca's strategy has been focused on transitioning
resources from on-shore locations (close to the customer and often in high cost
countries) to near-shore and off-shore capabilities. Teleca's strategy is to
offer world-leading design and development services to the major players of the
mobile device industry. Customers in this category include Nokia, Samsung, LG,
Sony Ericsson, Kyocera, Motorola, Adobe and Google. 

The results over the last eighteen months have been restrained by this
transition. The current market developments and economic circumstances will lead
to increased price competition in the market and the board expects the recent
transition to low-cost development capability to have positive effects over the
coming years. However, the timing of the full effect of the changes is difficult
to predict. 

The board of directors believes that the company, in a long-term perspective,
has significant potential that motivates a higher value than the price currently
offered by CayTel implies. In a price perspective, it is however crucial how
quickly the company succeeds with its program of change.
In a shorter time perspective, the Offer should be assessed relative to the
currently existing alternatives. The price offered by CayTel is significantly
higher than the Teleca share price during the time period immediately preceding
the Offer. 

Based on the above, the board of directors of Teleca has concluded that the
Offer is not unfair from a financial point of view to the shareholders ofTeleca.

The chairman of the board, Chet Kamat, and the board member John Treadwell, who
are both acting for STG in the Offer and thus have a conflict of interest, have
not participated in the board's handling of or resolutions regarding the Offer.

This statement shall be governed by and construed in accordance with the laws of
Sweden. Any dispute, controversy or claim arising out of, or in connection with,
this statement shall be settled exclusively by Swedish courts.


Malmö, 2 December 2008

Teleca AB (publ)
The Board of Directors


For further information please contact:

Johan Vunderink, Board Member, +31 653 789 981

Teleca is required under the Securities Markets Act to make the information in
this press release public. The information was submitted for publication at 8:45
CET on 2 December 2008.


Teleca is a world-leading supplier of software services to major players of the
mobile device industry. The company offers tailored solutions, systems design
and the integration of software and hardware for mobile phones. Teleca has about
2,000 employees in 9 countries in Asia, Europe and North America and is quoted
on the small cap list of the Nordic Exchange.