The Carlyle Group to Acquire KCS.net In Partnership With Management; Growth Opportunities Abound for Leading ERP Software Integrator

London – Global private equity firm The Carlyle Group today announced that it has signed a definitive agreement to acquire in partnership with management KCS.net Holding AG, an Enterprise Resource Planning solution (ERP) vendor based in Liestal, Switzerland, in an all-cash transaction.

Founded in 1989, KCS.net is a rapidly growing vendor of Microsoft-based ERP solutions and related consulting services. The company is a major solutions partner for medium-sized enterprises in the manufacturing, retail and automotive sectors in Germany and Switzerland. KCS.net’s business model focuses on consulting and implementation services based on “Microsoft Dynamics AX”, Microsoft’s top range ERP product. With nine offices in Germany and Switzerland, the company supports more than 180 customers. In 2007 KCS.net generated more than €17 million in revenues and has been growing in excess of 20% p.a. in recent years.

Carlyle Managing Director Michael Wand said, “We believe that KCS.net is the right company, in the right segment, with the right team. The European ERP market for medium-sized companies is the strongest growth sector of the general business application market and Microsoft has evolved as a serious contender in this market. Under the excellent leadership of Frank Koydl and Harald Scherrer, KCS.net has become a very successful system integrator for MS Dynamics solutions. Carlyle’s European technology team is looking forward to supporting the company in its next growth phase, organically and through acquisition.”

KCS.net Chairman and CEO Frank Koydl said, “KCS.net has been on a rapid growth path driven by our outstanding team of over 110 highly skilled employees. We are delighted to have found in Carlyle an investor whose resources and expertise will help propel us forward as we continue to grow throughout the D-A-CH Region.”

Harald Scherrer, COO and Co-owner, added, “Our focused strategy in primary markets as well as specialised industry and trade solutions brought our company into the leading market position in Germany and Switzerland. On that KCS.net has great potential for further expansion. We look forward to working with Carlyle as we enter this exciting new chapter in our company’s development.”

Wolfgang Hanrieder, Co-Head of Carlyle’s European Technology Team commented, “Since 2002, Carlyle’s European technology team has acquired and invested in 18 small and medium-sized companies, supporting their growth, expansion and business transformation initiatives in the technology space. We are great admirers of the entrepreneurial drive of Mr Koydl and Mr Scherrer and are sure that our international presence and deep expertise will help them to realise their ambitions for KCS.net.”

The transaction is subject to customary closing conditions and is expected to close in Q1 2008.

* * * * *

KCS.net
KCS.net is one of the leading Microsoft Dynamics AX solution providers in Germany and Switzerland. The company has ten offices in Germany, Switzerland and the Czech Republic. With more than 110 employees, most of them software specialists, KCS.net implements premium ERP software solutions in medium-sized enterprises. The company is clearly focused on the manufacturing, retail and automotive sectors and realized successfully more than 300 ERP projects. KCS.net is Microsoft Gold Certified Partner and since 2005 member of Microsoft’s Presidents Club and Inner Circle. For more information, visit www.kcs.net.

# # #