Locuz and Choice Solutions set to merge

Hyderabad

November 27th, 2007

Hyderabad based Locuz Enterprise Solutions and Choice Solutions have
announced that they will be entering into a definitive agreement to merge in an
all-stock transaction. Under the agreement, which is yet to be approved by the
Indian regulatory authorities, Locuz stock will be converted into Choice stock
at a fixed exchange ratio of two shares of Choice common stock for each
outstanding share of Locuz common stock.

The combined entity would operate under the name of Locuz-Choice Solutions
Ltd. K V Jagannath, M D and CEO of Choice Solutions will continue as MD and CEO
of the combined entity. Vijay K Wadhi, President of Locuz Enterprise Solutions,
will be the JMD. The board of directors of the combined entity will be
reconstituted to include equal number of members from both the company boards.

"Both Choice and Locuz are set to become leading technology companies in
the country by 2010. With growing complexity in IT environments, our customers
are seeking a strategic partner that will fulfill their ongoing IT needs. This
merger is a natural, accelerated progression towards our mutual goals and total
customer satisfaction," said K V Jagannath, MD, Choice Solutions.

"Our customers wanted us to go beyond availability, security and
performance and help them maximize returns on their IT investments by making
their IT Business centric. Locuz has developed industry specific methodologies
to address these concerns. We firmly believe that Services Oriented
Infrastructure (SOI) and methodologies for Infrastructure orchestration is the
future, said Vijay K Wadhi, President, Locuz Enterprise Solutions. "The
merger accelerates our ability to reach out to many more customers with
increased resources, both financial and intellectual, to strengthen our service
delivery capability."

Post the merger, the combined market reach and revenue base would increase
significantly both in terms of finances and human resources. The aggregate
revenue of the combined company is expected to be approximately Rs 150-170 Cr
for FY08, which begins in April 2007 and ends in March 2008. It is expected that
75 percent revenue of the combined company will come from the Enterprise
Solutions business and the remaining from IT Services. The employee strength
will exceed 550. The merger is expected to close in the first quarter of 2008
and is subject to customary closing conditions, including approval by the
shareholders of both companies and regulatory approvals.