Geoworks Acquires Eden Group


Acquisition of Eden Group Ltd. will extend Geoworks' international presence, solidify company's leadership position in the emerging smart phone market

ALAMEDA, Calif. (Feb. 13, 1997) - Accelerating its leadership position within the rapidly growing smart phone market, Geoworks (Nasdaq: GWRX) today announced its intent to acquire Eden Group Ltd., a U.K.-based provider of underlying system software for RISC-based mobile communicating devices. In addition, the acquisition will provide Geoworks with an established European office, and experienced management and engineering teams, and strengthens its existing presence in Japan.

Geoworks estimates it will pay approximately $30 million for Eden Group Ltd., all in stock. In conjunction with the completion of the transaction, Geoworks will issue approximately 1.28 million new shares of common stock, increasing the company's total shares outstanding by approximately nine percent to approximately 15.4 million shares. The company expects to incur transaction-related expenses of approximately $1.5 million during the quarter within which the transaction is completed. The company expects the acquisition to close in the quarter ending March 31.

"The acquisition of Eden Group Ltd. further illustrates Geoworks' commitment to aggressively pursue a global presence, and advances our leadership role within the explosive smart phone market," said Gordon Mayer, president and CEO of Geoworks. "With a well-established European team already in place, we will be more closely integrated with our European customers."

Eden Group Ltd. founder David Crisp will be appointed to the newly created position of vice president, general manager, Geoworks Europe, a wholly owned subsidiary. The company anticipates Eden Group Ltd. employees will remain in England to form the core team of Geoworks Europe.

"Our two companies are passionate about our shared vision, making this an ideal fit that will have tremendous benefit for both organizations as well as for the cellular industry and consumers," said David Crisp. "Together we hope to enable the design of smart phones that offer consumers a wide range of functionality and price points." Geoworks, whose GEOS operating system software is at the heart of the award-winning Nokia 9000 Communicator, is rapidly emerging as a leading global software platform standard for next-generation digital-cellular phones, or "smart phones." Smart phones integrate voice with additional communications features such as e-mail, paging, facsimile, and Internet access to online information and services. Because of Geoworks' robust technology solutions, the company has secured alliances to build smart phones with some of the world's leading cellular phone suppliers: Nokia, NEC, Ericsson and Toshiba.

Consumers in Europe and Japan are already rapidly adopting next-generation digital-cellular phones: the Nokia 9000 has far exceeded expectations in Europe, and Japan's consumers are adopting digital-cellular service faster than anywhere else in the world. In total, the worldwide market for smart phones is expected to reach $2 billion by the year 2000, according to research firm Mobile Insights, with the U.S. market poised to take off in 1997 as digital-cellular networks are launched and smart phones become available.

Geoworks...Uniquely Qualified
To provide additional value to smart phone customers, Geoworks intends to work with international cellular operators and providers of wireless content and services to provide smart phone users with anytime, anywhere access to a wide range of customized information and services such as travel, financial data, news, entertainment, electronic commerce and directory services in Europe, Japan and the United States.

The market for wireless data services is projected to grow from $2.7 billion in 1996 to approximately $10.9 billion in 2001, according to industry analysts at The Pelorus Group.

About Eden Group Ltd.
Eden Group Ltd. is based near Manchester, England. The company was founded in 1989 with a specific mission: develop breakthrough software technology to enable the design of high-value handheld consumer appliances. As with Geoworks, Eden Group Ltd.'s design goals focus on compactness and low memory requirements.

About Geoworks
Based in Alameda, California, Geoworks is a leading software provider for the cellular industry and manufacturers of mobile communicating devices, including smart phones. The company has licensed its GEOS operating system to leading manufacturers such as Nokia, Ericsson, NEC, Toshiba Corporation, Hewlett-Packard Company, Brother International Corp. and Canon Business Machines. In addition, the company intends to work with content and services providers, and international cellular operators.

For additional information on Geoworks and the GEOS operating system, contact Geoworks on the World Wide Web at

In keeping with U.S. law, Geoworks notes that this press release includes forward-looking statements, including the Company's intentions to complete the acquisition of Eden Group Ltd. and to package and deliver targeted content and services, the emergence of the smart phone market and forecasts by third parties concerning the potential for market growth, the establishment of key partnerships, and the timing and availability of content and service offerings worldwide. Completion of the Eden Group Ltd. acquisition is subject to the satisfaction of certain contractual and legal conditions and acceptance by Eden shareholders. Actual results may vary significantly due to various risks and uncertainties. Those include, but are not limited to, the following: i) the smart phone market may not emerge to the degree or in the timing anticipated; ii) the Company must consummate definitive agreements with key partners; iii) delivery of content and services to cellular phones is dependent upon the development of complementary technologies and alliances beyond the Company's control; and iv) new technologies and new services are inherently subject to development, timing and consumer acceptance risks. Additional information is available in the Risk Factors and Business discussions in the Company's Forms 10-K, 10-Q and other filings available from the Company or from the Securities and Exchange Commission.

Source: Geoworks