Alcatel Telspace acquires 10 percent of SSE Telecom Inc.

VIENNA, Va.--(BUSINESS WIRE)--Sept. 6, 1996--SSE Telecom Inc. (NASDAQ/NMS:SSET) Friday announced that Alcatel Telspace S.A., a unit of Alcatel Telecom, has purchased 625,000 shares of SSE common stock for aggregate proceeds of $7,826,500, or an average price of $12.52 per share.

The company sold 525,000 common shares for aggregate proceeds of $6,751,500, or $12.86 per share. Alcatel Telspace also purchased an additional 100,000 SSE common shares for aggregate consideration of $1,075,000, or $10.75 per share, from two members of the company's senior management.

Alcatel Telspace now owns approximately 10 percent of SSE's outstanding common stock. In addition, Alcatel Telspace received a three-year warrant to purchase up to another 300,000 shares of SSE common stock at market price at the time of exercise but not less than $11 per share.

SSE and Alcatel Telspace also entered into an agreement to jointly develop certain satellite communications equipment, which will increase SSE's product offerings to its customer base. The two companies have collaborated in the development of satellite communications equipment in the past.

As part of the transaction with Alcatel Telspace, the selling shareholders agreed to the early exercise of certain options and warrants, which will result in additional proceeds for the company of $233,000, and further have agreed not to dispose of any additional shares of stock prior to March 1997.

In addition, the selling shareholders are parties to a stockholder agreement among Alcatel Telspace, SSE and certain shareholders.

Frederick C. Toombs, president of SSE, noted that 450,000 of the SSE shares purchased by Alcatel Telspace were treasury shares that had previously been repurchased by the company. Accordingly, he said that the transaction involved the issuance of only 75,000 new SSE common shares.

``Alcatel Telspace has always been one of our most important customers. Now we are pleased to welcome Alcatel Telspace as a significant shareholder in SSE as well as to a seat on our board of directors. We look forward to working closely with them in the development of new satellite communications products and continuing to expand our business relationship in the future,'' Toombs said.

Alcatel Telspace is the leading European systems provider of satellite Earth stations. Alcatel Telecom is the world leader in the manufacture and installation of microwave radios, with an estimated 20 percent worldwide market share and an estimated 30 percent share of the U.S. market.

SSE Telecom is a leading satellite-Earth-station component and system manufacturer. To date, more than 30,000 of SSE's transceivers or modems have been installed in satellite Earth stations in more than 85 countries worldwide.

CONTACT: SSE Telecom Inc.

Frederick C. Toombs, 510/657-7552

Daniel E. Moore, 703/442-4503