| MAGIC SOFTWARE ENTERPRISES USES MAGIC EMERCHANT TO HELP HOFFMANN GMBH DEVELOP SOPHISTICATED ONLINE PRESENCE IRVINE, CALIF.--(BUSINESS WIRE)--NOV. 1, 2000-- E-BUSINESS SITE TO MANAGE SALES OF ABOUT 
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 IRVINE, Calif.--(BUSINESS WIRE)--Nov. 1, 2000--
 
 E-Business Site to Manage Sales of About 35,000 Items to More Than
 78,000 Customers Worldwide
 
 Magic Software Enterprises (Nasdaq:MGIC.O), a leading provider of
 state-of-the-art technology and business solutions, Wednesday
 announced that it is working with Hoffmann GmbH Qualitaetswerkzeuge
 (Hoffmann), Germany's leading wholesaler of high-quality tools, to
 establish an online presence.
 The site, which is being developed and implemented in stages using
 Magic's award-winning e-commerce template (Magic eMerchant(TM)),
 ultimately will be home to about 35,000 items that can be ordered
 directly online for delivery within 24 hours. Currently, more than
 78,000 customers in Germany, including Audi and DaimlerChrysler,
 purchase their tools from Hoffmann.
 The challenge in creating the Hoffmann site is to provide Hoffmann
 the flexibility to offer each of its more than 78,000 customers
 different pricing for each of the approximately 35,000 items the
 company sells. In addition, Hoffmann wants a uniform catalog structure
 that will allow the company to impart the breadth of information, and
 to achieve the level of diversity, offered by its printed catalog.
 Also required is the ability for orders received on the site to be
 forwarded directly to the appropriate Hoffmann partner. And the site
 must be operational in 16 weeks.
 "We chose Magic eMerchant as our e-commerce solution because it
 allows us to implement a very complex and personalized site within an
 extremely short timeframe. None of the other competing products on the
 market, such as Intershop, can do this," said Koch-Erpach, head of
 Hoffmann's IT Department.
 "In addition, Magic eMerchant provides us all of the functionality
 we need, including customizable and personalized pricing and catalogs,
 different rights for individual users, and the scalability, to grow in
 the future."
 Magic is integrating Magic eMerchant with Hoffmann's SAP back-end
 system so that information may be drawn from the same database used
 for the printed catalog. In addition, Magic is integrating all of
 Hoffmann's partners completely into the Magic eMerchant system to
 allow them to receive orders directly, in both free text and order
 form format as needed.
 "Hoffmann represents a tremendous opportunity for Magic to
 demonstrate the superiority of its e-commerce solution, Magic
 eMerchant, and the speed with which it can be implemented to help
 businesses expand their international reach and become more
 profitable," said David Leichner, vice president of Worldwide
 Marketing for Magic.
 "We are extremely excited to be working with a company like
 Hoffmann that is so highly regarded in its industry."
 
 About Magic Software Enterprises
 
 Magic Software Enterprises, a member of the Formula Group
 (Nasdaq:FORTY.O), develops, markets and supports software development
 and deployment technology that enables enterprises to accelerate the
 process of building and deploying applications that can be rapidly
 customized and integrated with existing systems.
 Magic technology, applications and professional services are
 available through a global network of subsidiaries, distributors and
 Magic solutions partners in approximately 50 countries. The company's
 North American subsidiary is located at 1642 Kaiser Avenue, Irvine,
 Calif., 92614, telephone 949/250-1718, fax 949/250-7404,
 magicsoftware.com.
 The Formula Group is an international information technology
 company principally engaged, through its subsidiaries and affiliates,
 in providing software consulting services, developing proprietary
 software products and producing computer-based solutions.
 
 Except for the historical information contained herein, the
 matters discussed in this news release include forward-looking
 statements that may involve a number of risks and uncertainties.
 Actual results may vary significantly based upon a number of factors
 including, but not limited to, risks in product and technology
 development, market acceptance of new products and continuing product
 conditions, both here and abroad, release and sales of new products by
 strategic resellers and customers, and other risk factors detailed in
 the company's most recent annual report and other filings with the
 Securities and Exchange Commission.
 
 --30--EZ/np*  JP/np
 
 CONTACT:  Magic Software Enterprises, Irvine
 Katharine Hanley, 949/250-1718 ext. 220
 khanley@magic-sw.com
 
 KEYWORD:  CALIFORNIA
 INDUSTRY KEYWORD: E-COMMERCE SOFTWARE
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