Novatel Wireless To Acquire Enfora

Uniquely Positions Novatel Wireless to Address Fast-growing M2M Market

Diversifies Customer Base and Product Offerings to Drive Growth

Immediately Accretive to Non-GAAP Earnings

Expands Leadership and Market Reach in Wireless Data to all End Markets – Enterprise, Consumer and Vertical Markets

Novatel Wireless, Inc., a leading provider of wireless broadband solutions, has entered into a definitive agreement to acquire Enfora, Inc., a privately-held, Texas-based provider of intelligent asset-management solutions utilizing wireless technology and machine-to-machine (M2M) communications, for approximately $64.5M in cash at closing, subject to certain working capital adjustments. Possible additional consideration of up to $6M is contingent on certain performance targets being met.

Enfora had revenues of $61.3M during the 12 month period ended September 30, 2010, with gross margins of approximately 36 percent. Novatel Wireless expects the acquisition to be immediately accretive to its non-GAAP earnings.

Enfora sells to a diverse base of customers, which includes enterprises, applications service providers, OEMs and distributors. Enfora's product portfolio consists of smart M2M solutions – embedded platforms, integrated platforms, and embedded software – based on a distributed intelligent and customizable architecture that provides a valuable link between an enterprise and its remote assets. According to ABI Research, the market for cellular M2M connection revenue is expected to grow at an annual compound rate of more than 22 percent through 2014.

"This acquisition creates a market leader in wireless data selling into all end markets: enterprise, consumer and vertical markets," said Peter Leparulo, Chairman and CEO of Novatel Wireless. "This acquisition expands our addressable market, broadens our range of complementary products, diversifies our customer base and enhances operating leverage. It will also strengthen our competitive position by leveraging our combined research and development talent and customer relationships. Enfora, more than any other company providing M2M data communications, is focused on adding value with customized software and services and fits with our business strategy of combining hardware and software into integrated solutions."

Key benefits of the acquisition include:

• Diversifying Novatel Wireless' customer base and product lines into adjacent markets.
• Advancing the company's strategy of providing intelligent devices to all end markets – enterprise, consumer, and vertical applications. Enfora has developed differentiated solutions for key market segments, including transportation, industrial automation, security, and healthcare.
• Creating a strong growth profile by bringing together long-term customer relationships with wireless carriers, cable operators, distributors, retailers, MVNOs, leading OEMs in both mobile computing and vertical markets, enterprises, and application service providers.
• Leveraging the research and development, product portfolios, and geographic reach of the combined company.

"I am very pleased to welcome Mark Weinzierl, founder and CEO of Enfora, to our senior management team," added Mr. Leparulo. "His leadership and expertise will be a great asset to Novatel Wireless moving forward."

"We are bringing together two clear leaders in data communications," said Mark Weinzierl. "Our customers will benefit greatly from Novatel Wireless' leading-edge technology, strong relationships with mobile operators, and financial strength. Our combined company will be well positioned to address the growing demand for wireless data solutions and associated software."

Enfora will operate as a Novatel Wireless business unit, and the combined company will leverage synergies in product development, sales channels and complementary resources.

Additional Terms of the Transaction
Novatel Wireless and Enfora have signed an Agreement and Plan of Merger pursuant to which Enfora will become a wholly-owned subsidiary of Novatel Wireless. The acquisition is expected to close by the end of November. A controlling majority of Enfora stockholders has irrevocably consented to the acquisition.

The purchase price includes the pay down of all debt. The acquisition will be funded from cash on hand. As of September 30, 2010, Novatel Wireless had approximately $183M of cash and marketable securities on its balance sheet, with no debt.

Cowen and Company is acting as exclusive financial advisor to Novatel Wireless in connection with this transaction. Jefferies & Co. is acting as exclusive financial advisor to Enfora.

Conference Call Information
Novatel Wireless will host a conference call and live webcast for analysts and investors at 8:00 a.m. ET today to discuss details of the acquisition. For parties in the United States and Canada, call 877-941-8632 to access the conference call. International parties can access the call 480-629-9820.

The webcast will be accessible from the "Investor Relations" section of the Company's website at www.novatelwireless.com. The webcast will be archived for a period of 90 days. A telephonic replay of the conference call will also be available two hours after the call and will run until November 15. To hear the replay, parties in the United States and Canada should call 800-406-7325 and enter pass code 4375599. International parties should call 303-590-3030. In addition, Novatel Wireless' press release will be accessible from Novatel Wireless' website before the conference call begins.

About Novatel Wireless
Novatel Wireless is a leader in the design and development of innovative wireless broadband access solutions based on 3G and 4G wireless technologies. Novatel Wireless' Intelligent Mobile Hotspot products, software, USB modems and embedded modules enable high-speed wireless Internet access on leading wireless data networks. The Company delivers specialized wireless solutions to carriers, distributors, OEMs and vertical markets worldwide. Headquartered in San Diego, California, Novatel Wireless is listed on. For more information, visit www.novatelwireless.com.

About Enfora
Enfora is a leading provider of wireless networking solutions that enable enterprises to access, analyze and leverage information from their geographically dispersed assets. Our solutions, consisting of embedded wireless software, network edge wireless platforms – embedded and integrated – and enterprise software, are based on our distributed intelligent architecture that provides a valuable link between an enterprise and its remote assets. Enterprises deploy our solutions for location-based, monitoring and control, and asset management applications.

SOURCE: Enfora