XFONE ACQUIRES
CONTROLLING INTEREST IN
STORY TELECOM, INC.
May 17, 2006
LONDON, U.K. - (PR NEWSWIRE) - May 17, 2006 - XFONE, Inc. (AMEX:XFN), an international diversified communications services company, today announced that it has completed the acquisition of the controlling interest in Story Telecom, Inc., a telecommunication service provider specializing mainly, but not exclusively, in prepaid telecommunications. Story Telecom, Inc. operates in the United Kingdom through its two wholly owned subsidiaries, Story Telecom Limited and Story Telecom (Ireland) Limited.
Currently, Story Telecom has a direct customer base of more than 300,000 mobile phone users and its prepaid cards are available in 35,000 retail locations throughout the United Kingdom. Story Telecom has also recently launched three new services, including Story Text & Talk, Story Direct and Story Mobile, all of which enable users to make low-cost international phone calls by various means.
Guy Nissenson, President and CEO of XFONE, Inc. noted, "Story Telecom is a recognized brand name with its own loyal customer base and a variety of successful products in the U.K. Moreover, the Company currently holds a substantial share of the prepaid telephony market and is widely recognized as a leader in providing low cost international communications for mobile phone users. For the past several years, XFONE's operations in the U.K. have enjoyed a productive relationship with Story Telecom, and have been impressed with its growth."
Continuing, Nissenson added, "When the opportunity to increase our interest in Story Telecom presented itself, we wasted no time in pursuing it. We are pleased to advance our relationship with Story Telecom and believe that XFONE can play a meaningful role in helping the Company build on its historical performance"
The terms of the acquisition provide for XFONE to increase its current stake in Story Telecom from 39.2% to 69.6% in a cash transaction valued at $1.2 million. $900,000 of the total consideration will be applied to payables owed by Story Telecom to XFONE and its subsidiary Swiftnet Limited for back-end telecommunications services. The balance of $300,000 was paid to Story Telecom, and will be used as working capital. On a moving forward basis, Story Telecom will operate as a division of the XFONE operation in the U.K. Founder and CEO of Story Telecom, Nir Davison, will remain as Managing Director of the division.
Commenting on the transaction, Davison stated, "Expanding our relationship with XFONE required little contemplation. We have enjoyed a long-standing strategic partnership that has yielded nothing but positive results for both of our companies. Now that our interests are fully aligned, we can focus on compounding our strengths, leveraging our mutual resources and customers, promoting aggressive revenue growth and perpetuating our success as one entity. It's an exciting milestone for Story Telecom and one that we are confident will prove to be highly beneficial for XFONE."
About XFONE, Inc.
A U.S.-domiciled corporation, XFONE, Inc. is an international voice, video and data communications services provider with operations in the United Kingdom, the United States and Israel that offers a wide range of services, which include: local, long distance and international telephony services; prepaid and postpaid calling cards; cellular services; Internet services; messaging services (Email/Fax Broadcast, Email2Fax and Cyber-Number); and reselling opportunities. The Company serves customers across Europe, Asia, North, Central and South America, Australia and Africa.
This press release contains forward-looking statements.
The words or phrases "should," "would
be," "will allow," "intends to,"
"will likely result," "are expected to,"
"will continue," "is anticipated,"
"estimate," "project," or similar
expressions are intended to identify "forward-looking
statements." The Company's financial results reflected
above should not be construed by any means as representative
of the current or future value of its common stock.
All information set forth in this press release, except
historical and factual information, represents forward-looking
statements. This includes all statements about the company's
plans, beliefs, estimates and expectations. These statements
are based on current estimates and projections, which
involve certain risks and uncertainties that could cause
actual results to differ materially from those in the
forward-looking statements. These risks and uncertainties
include issues related to rapidly changing technology
and evolving standards in the industries in which the
Company and its subsidiaries operate; the ability to
obtain sufficient funding to continue operations, maintain
adequate cash flow, profitably exploit new business,
and license and sign new agreements; the unpredictable
nature of consumer preferences; and other factors set
forth in the Company's most recently filed annual report
and registration statement. Readers are cautioned not
to place undue reliance on these forward-looking statements,
which reflect management's analysis only as of the date
hereof. The Company undertakes no obligation to publicly
revise these forward-looking statements to reflect events
or circumstances that arise after the date hereof. Readers
should carefully review the risks and uncertainties
described in other documents that the Company files
from time to time with the Securities and Exchange Commission.
| For More Information, Please Contact: |
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| U.S.
IR Contact |
John G. Nesbett/Jennifer Belodeau
Institutional Marketing Services (IMS)
Phone: 1.203.972.9200.
E-mail: jnesbett@institutionalms.com |
|
| Xfone Contact |
|
Niv Krikov
Chief Financial Officer
Phone: 1.806.771.1181
E-mail: niv@xfone.com
5307 W. Loop 289
Lubbock, TX 79414-1610
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