The Board of Directors of IBS AB recommends shareholders not to accept the offer from Deccan Value Advisors Background Deccan Value Advisors Fund L.P., Deccan Value Advisors Fund Ltd., A/D Value Fund L.P. and Y/D Value Fund L.P. (”Deccan”) announced on 30 June, 2008 a public bid for all shares in IBS AB (“IBS” or “the Company”). Deccan announced that it had increased its shareholding in IBS to above 30.0 percent of the votes. Thus, in accordance with the provisions governing mandatory bids, Deccan made a public cash offer to the shareholders of IBS. According to the offer document dated 11 July, 2008 (the “Offer Document”) the shareholders of IBS are offered to tender all their shares in IBS to Deccan for a consideration of SEK 9.64 (the “Offer Price”) in cash per share (the “Offer”). The Offer Price is subject to adjustment should IBS pay any dividend or in any other way distribute or transfer funds to shareholders before settlement of the Offer. On 1 July, 2008, the Board of Directors of IBS (“the Board”) issued a press release stating that it would revert with its recommendation to the shareholders well in time before the end of the acceptance period. The Board has retained Carnegie Investment Bank AB (“Carnegie”) as financial advisor. Two of IBS' board members, Vinit Bodas and George Ho are employed by Deccan Value Advisors L.P., which is the general partner and financial advisor to Deccan. Due to Vinit Bodas and George Ho being related to the bidder, they have not participated in the Board's assessment of the offer. Recommendation by the Board of Directors It is the opinion of the Board that the Company is currently going through a transition phase that will significantly improve the long term profitability of IBS. During the first quarter 2008, IBS launched a new phase of its ongoing activity program in order to improve profitability. Among the activities in this phase, IBS reduced the number of non-billable staff considerably compared with the 2007 level. The implementation of a new global structure in order to better support international customers in IBS' key industry solutions has been finalized. The company has just successfully completed a rights issue that was fully subscribed. The rights issue provided the company with approximately SEK 397 million before transaction costs. This capital will enable IBS to improve profitability by making investments in new and expanding geographic markets, complete the new product offerings on new technical platforms, continue the shift of resources to mid- and low-cost countries and to implement other cost measures within the aforementioned activity program. A detailed plan for these activities will be presented during the fall 2008. In reviewing the Offer and deliberating on its recommendation, the Board has considered IBS' current performance and future prospects, as well as other factors deemed to be of relevance in relation to its assessment of the Offer. Deccan has provided limited information regarding the effects that the completion of the Offer would have on IBS, in particular with regard to employment and IBS' strategic plans. Deccan states it does not currently intend to change IBS' strategic plans or to any material extent, change the terms of employment or number of employees at the Company's current locations. However, no guidance is given with respect to any such plans in the medium- to long term. Based on the very limited information provided to date by Deccan, the Board cannot make any assessment as to what effect the Offer would have on the location of IBS' businesses, or the employment situation for current employees. Carnegie Investment Bank AB has issued a fairness opinion to the Board of Directors. This opinion is attached to this statement. In summary, the Board believes that the transition phase that IBS is currently going through, will significantly improve the long term profitability of the Company. In view of this, it is the opinion of the Board that the Offer Price does not adequately reflect the value of IBS. The Board recommends IBS' shareholders not to accept the Offer. Shareholders with a short-term view on their holding in IBS should notice that the general economic development is currently uncertain. In the event that further economic developments prove to be worse than expected, this could have a negative effect on IBS' earnings. Furthermore, shareholders' attention should also be drawn to the fact that Deccan currently controls 27.1 percent of the outstanding capital and 44.4 percent of the outstanding votes of IBS. Such ownership concentration could potentially reduce the liquidity in the market for the IBS share, which could have a negative effect on its price going forward. IBS AB Board of Directors For more information please contact: Oskar Ahlberg, Investor Relations Director IBS AB Phone: +46 70 244 24 75 oskar.ahlberg@ibs.net IBS in brief With over 30 years of supply chain expertise, IBS is a leading provider of complete ERP solutions. IBS focuses on mid-sized and large distribution companies, as well as sales and manufacturing subsidiaries of international groups, mainly within industries such as automotive, electrical, food, industrial supplies, paper, pharmaceutical, publishing and wholesale distribution. More than 5,000 customers across some 40 countries use IBS software to gain fast and measurable returns on IT investments. IBS B share is listed on OMX Nordic Exchange Stockholm. For more information, please visit www.ibs.net
The Board of Directors of IBS AB recommends shareholders not to accept the offer from Deccan Value Advisors
| Source: IBS AB