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Munich, Germany/Savyon, Israel, December 11th, 2007 – smac partners Fund II acquires stakes in 10 portfolio companies from Vertex Venture Capital. smac partners is an internationally leading venture capital firm in the Information and Communication Technologies sector (ICT). To finance the deal, smac partners was backed by Headway Capital, an independent UK-based secondary firm. The terms of the transaction were not disclosed.

“Vertex is renowned for its excellent investment choices. We are delighted to have arranged the acquisition of this portfolio and we are also pleased about the confidence Headway Capital has put into the deal. The portfolio will be continuously developed over the next three to five years through experience in the ICT-industry and further financing rounds”, said Dr. Dietrich Ulmer, Managing Partner of smac partners.

Yoram Oron, Founder and Managing Partner of Vertex Venture Capital added: “We reached the tenth year of our fund and sought a partner who can continue to support our portfolio investments. We chose smac partners, because smac has been a very reliable co-investor in the past with comprehensive experience in Israel. We are confident the companies will continue their successful development.”

Christiaan de Lint, Partner at Headway Capital said: “We are delighted to back smac partners in this transaction. The Vertex-portfolio companies have already set standards in their respective fields and we look forward to supporting them in the future. This deal perfectly matches our strategy: complex, niche secondary directs with quality assets and a strong general partner”. Headway purchased two other secondary direct portfolios in 2007, one in Germany and one in France.

The portfolio includes technology leaders such as:

• Runcom Technologies (Rishon Lezion, Israel) heads the development of Mobile WiMAX with its groundbreaking silicon solutions. The recent announcement by the International Telecommunication Union that WiMAX has been approved as a 3G IMT-2000 standard is a colossal achievement for Runcom which is pioneering the OFDMA technology since its early days.
• Flash Networks (Herzlia, Israel) is a leading provider of quality-of-experience (QoE) solutions that accelerate mobile Internet adoption by empowering improved user experience. The company serves a growing installed base of over 40 top-tier mobile carriers worldwide such as T-Mobile, Vodafone and Orange.
• Image ID (Hod-Hasharon, Israel), a multinational company with partner networks in the US, in Europe and in Japan, develops and markets large field-of-view, traceability solutions for logistics and manufacturing applications. Its unique imaging-based technology is an effective alternative to RFID for rapid identification and tracking of assets. It is currently being used to track over 1 million assets every day, worldwide.

“We regard this transaction as an important step to systematically grow our business. We are actively evaluating further secondary opportunities in Israel and beyond”, said Dr. Ingo Potthof, Partner at smac partners and responsible for investments in Israel.

Other transactions of smac partners in 2007 include the sale of the Swedish GPS-company NordNav to the British world leader in Bluetooth technology, Cambridge Silicon Radio (LSE:CSR.L). This is regarded as one of the most spectacular European exits this year.

About smac partners
smac | partners - formerly known as Siemens Acceleration in Communications - is the ICT early stage venture capital investor based in Munich, Germany. smac | partners is one of the few venture capital companies with investment, management and exit experience in the US, China, India, Europe and Israel. We currently advise TempoPark Fund I and its acquisition of the early-stage ICT-portfolio from Siemens AG. For more information: www.smacpartners.com

Contact: Dr. Dietrich Ulmer
Phone: +49 89 550 688 11
e-mail: dulmer@smacpartners.com

About Vertex Venture Capital
Vertex Venture Capital is a unique top-tier Israeli VC with $600 million under management, a strong international investor base, an experienced multi-disciplinary team of professionals and an impressive track record of exits through M&A and IPO. Vertex provides unparalleled possibilities for companies in facilitating potential growth, business opportunities and leveraging synergies throughout Israel, Europe, USA, Japan and Asia. Vertex invests in Israeli and Israel-related companies in early stages of development in information networking and communications systems, software and components, digital media and enterprise software. For more information: www.VertexVC.com

Contact: Sharon Lewis
Phone: +972 3 737 8888
e-mail: Sharon@vertexvc.com

About Headway Capital Headway
Capital Partners is an independent private equity secondaries and special opportunities firm with over €120 million of assets under management. Headway provides a full range of liquidity solutions to investors seeking exits from or alternatives for their private equity assets by purchasing both limited partnership positions in venture capital and private equity funds as well as portfolios of direct investments. Headway differentiates itself through its focus on small to mid-size transactions and its expertise in executing complex and structured deals. Headway is London based and invests primarily in the USA and Europe. For more information: www.headwaycap.com

Contact: Christiaan de Lint
Phone: +44 20 7518 8878
e-mail: christiaan@headwaycap.com

Reference#: smac | partners 2007-12-11 No.002 (Acquisition of a ICT-Portfolio from Vertex Venture Capital)

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