(BW)(STM-WIRELESS)(STMI) STM Wireless Inc. Receives Contract Award From Embratel in Brazil; Immediate Equipment Order for $1.7 Million With Option for Additional $5.7 Million
Business Editors/High Tech Writers
IRVINE, Calif.--(BUSINESS WIRE)--Aug. 3, 1998--STM Wireless Inc. (STM)(NASDAQ/NMS:STMI), a leading manufacturer of wireless communications products, today announced receipt of a contract award by its STM Network Systems Division for a DAMA network purchased by Embratel, the satellite communications and long distance carrier arm of the recently privatized Telebras companies.
Embratel intends to use the DAMA system supplied by STM for offering both private network and telephony services throughout Brazil.
"Brazil is considered to be one of the most important markets in worldwide satellite communications and Embratel, which owns and operates the Brazilian domestic satellite system, is considered to be the dominant Brazilian authority in this area. We are delighted to see Embratel as our latest customer and business partner," stated Emil Youssefzadeh, chief executive officer of STM.
"While Embratel has purchased satellite networks from other vendors before, the contract award to STM represents the first ever MESH DAMA network purchased by Embratel. The new contract from Embratel will position STM to further strengthen its market penetration in Brazil by becoming the first and only established supplier of MESH DAMA systems to the Telebras member companies."
Telebras is undergoing a major privatization, which involves three operating phone companies, Embratel and eight cellular operations. The privatization process is expected to introduce new mandates for the "Universal Service Plan" by all the operating phone companies as part of the license obligations.
Youssefzadeh added, "We expect that the demand for satellite communications, and particularly for satellite telephony services, will grow significantly in Brazil, especially after conclusion of the Telebras privatization. STM's selection by Embratel, which resulted from a rigorous tender process, is a tribute to STM's DAMA product family, which surpassed the price/performance of the other systems offered by all competitors in the tender."
Under the terms of the contract, Embratel has the option to purchase approximately $11.5 million in goods and services over the next 3 years from STM and its Brazilian partners. This amount includes approximately $1.7 million in DAMA systems and services expected to be delivered by STM during the second half of 1998, with another $5.7 million in goods and services that could be purchased from STM, at Embratel's option, during the following quarters.
STM Wireless Inc., headquartered in Irvine, Calif. (Web Site: www.stmi.com), is an international provider of communications solutions for rural telephony applications with equipment installed in over 90 countries.
The company operates as two independent, but complementary businesses: STM Network Systems (STM-NS) which supplies satellite network systems worldwide and Direc-to-Phone International Inc. (DTPI), a majority-owned subsidiary, which is a leading provider of fixed station telephony services implemented in lower population density geographies. DTPI uses products manufactured by STM-NS to enter into long-term agreements with local partners to provide turnkey communications services.
This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, from time to time, STM Wireless Inc. or its representatives have made or may make forward-looking statements, orally or in writing. The words "estimate," "project," "potential," "intended," "expect," "believe" and similar expressions or words are intended to identify forward-looking statements.
Such forward-looking statements may be included in, but are not limited to, various filings made by the company with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions.
As discussed in the company's Annual Report on Form 10-K for the year ended Dec. 31, 1997, and its Form 10-Q for the first quarter of fiscal 1998, the company's future operating results are uncertain and may be impacted by the following factors, among others: the long-term cycle involved in completing major contracts, particularly in foreign markets; increasing competitive pressures; general economic conditions; technological advances; the timing of new product introductions; political and economic risks involved in foreign markets and foreign currencies; and the timing of operating and other expenditures.
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CONTACT: STM Wireless Inc.
Joseph J. Wallace, 949/753-7864
www.stmi.com
or
Lippert/Heilshorn & Associates
Investor Relations Contact:
Keith Lippert, 212/838-3777
Kris Otridge, 415/433-3777
KEYWORD: CALIFORNIA
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED TELECOMMUNICATIONS
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