Acquisition to create the largest provider of pan-African network services to a broad range of businesses and telecommunications operators in over 40 countries

9 May 2007 - Gateway Communications, a leading provider of pan-African voice and data connectivity services, has agreed to acquire GS Telecom, provider of data connectivity services to corporate customers and telecommunications operators in Africa. The transaction was valued at approximately $37.5 million and is to be financed through a combination of cash and funds from a newly issued bond. The transaction is expected to complete mid-May subject to certain conditions.

GS Telecom provides services in 27 African countries, with a major presence in Nigeria, the fastest growing communications market in Africa over the last five years.

The transaction would strengthen Gateway’s position as the largest provider of voice and data connectivity services in sub-Saharan Africa, boosting Gateway’s customer base with an additional 200 customers to over 1,200 customers in over 40 countries in Africa (Gateway’s current network includes 30 African countries). The acquisition would bolster Gateway’s presence in the rapidly growing business communications market and provide access to local infrastructure and support capability.

The transaction will also increase Gateway’s geographic footprint and provide greater access to the rapidly growing Nigerian market. The enlarged business will benefit from network economies of scale with access to the largest private satellite footprint on the continent consisting of 25 transponders of capacity and to the SAT-3 undersea cable.

Founded in 1994, GS Telecom provides a broad range of secure network services and turn-key communications systems, including design, implementation and management to predominantly multinational companies in the energy, mining, consumer products, logistics, banking and telecommunications sectors. Major customers include Total, Shell, ExxonMobil, Coca-Cola, Citi, Standard Chartered Bank, MTN and Celtel. GS Telecom has 216 employees mainly in West Africa with 150 based in Nigeria.

The combined proforma revenues for the year ended 31 December 2006 for Gateway and GS Telecom were $180.0 million and EBITDA was $28.3 million.

Julian McIntyre, President of Gateway Communications commented:

“This is a substantial acquisition which marks a further step in our strategy to consolidate our leading position in the rapidly growing African communications market. We are committed to improving the value proposition that we can offer to our customers, and the customers of GS Telecom, through providing a broader service range, greater geographic coverage and excellent local and international support capabilities. We look forward to working with the GS Telecom management team and staff to grow the enlarged Group.”

Steve Chapman, President and CEO of GS Telecom commented:

“Gateway and GS Telecom are an excellent match; Gateway is a leader in the carrier market while GS Telecom is a leader in the business communications market. Gateway has a major international presence, while GS Telecom has strong local support. We have highly complementary services and geographic coverage and our combined customer base will include the major businesses and mobile operators in Africa.”

ENQUIRIES

Gateway Communications
Tom Tudor
Tel: + 44 20 7173 1700

College Hill
Corinna Dorward (London)
Tel: + 44 20 7457 2020

Fred Cornet (South Africa)
Tel: + 27 11 447 3030

NOTE TO EDITORS:

About Gateway Communications
Gateway Communications is the leading provider of communications services to telecommunications operators and corporations in Africa. Gateway delivers the highest quality, most comprehensive and affordable international communications services on the continent.

With operations dating back to 1991, Gateway Communications is one of the most established operators in Africa and has been responsible for pioneering the delivery of cost effective voice, data and e-commerce services throughout the region.

Gateway Communications has developed the local presence, skills and expertise combined with the global infrastructure and relationships to uniquely meet the voice and data communications needs of local telecommunications operators and businesses operating within Africa.

These materials are not an offer of securities for sale in the United States. The securities may not be offered or sold in the United States absent registration with the United States Securities and Exchange Commission or an exemption from registration under the U.S. Securities Act of 1933, as amended. Gateway has not registered, and does not intend to register, any portion of the offering in the United States, and does not intend to conduct a public offering of Securities in the United States.
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