AsiaInfo to Acquire Bonson Technology for US$47 Million; AsiaInfo Vaulted to No.1 Position in Key Wireless Market.

Business Editors/High-Tech Writers

BEIJING & SANTA CLARA, Calif.--(BUSINESS WIRE)--Jan. 22, 2002

Transaction Immediately Accretive Adding 8-10 Cents to 2002 EPS 

AsiaInfo Holdings, Inc. (Nasdaq:ASIA), a leading provider of telecom network integration and software solutions in China, today announced that it has entered into a definitive agreement to acquire 100% of Bonson Information Technology Limited ("Bonson"), a leading provider of telecom operation support system ("BOSS") solutions in China. This transaction will be highly accretive expected to add approximately 8-10 cents to AsiaInfo's 2002 earnings per basic share.

The transaction, valued at approximately US$47.3 million, is comprised of US$28.9 million in cash and US$18.4 million in AsiaInfo stock. The management shareholders will receive US$18.4 million cash and US$11.3 million stock with one-year lock-up. Other shareholders will receive US$10.4 million cash and US$7.1 million stock with three-month lock-up. AsiaInfo stock will be issued at US$19.22 per share.

James Ding, President and CEO of AsiaInfo, commented, "We are pleased to announce the agreement with Bonson, a trusted and highly regarded software solution provider to China's top telecom carriers. This acquisition demonstrates our ability not only to grow organically but also through attractive acquisitions."

Jian Lee, President and CEO of Bonson, added, "Bonson's industry expertise, large installation base, and proven profitability complement AsiaInfo's strengths as a leading provider of telecom software and solutions. We are very excited to become a part of expanded platform."

Founded in 1994, Bonson is 61% owned by the management and 39% owned by an affiliate of International Data Group and other private investors. The company has about 200 employees, mainly based in Guangzhou, China. Developed with proprietary technology, Bonson is a top provider of BOSS solutions, which encompass a range of mission critical functions including billing, accounting & reporting, settlement, customer relationship management and decision support system. The company's other product lines include mobile network monitoring systems, network management and wireless data applications. Mobile BOSS accounted for approximately 85% of Bonson's net revenue and employed approximately two thirds of Bonson's workforce in 2001.

Bonson's main customer is China Mobile. The company provides interconnect and roaming settlement systems for the China Mobile Group and BOSS solutions to provincial operators including Guangxi Mobile, Guizhou Mobile, Gansu Mobile and Tibet Mobile. In addition to BOSS, Bonson markets and sells other products and solutions to more than twenty provincial operators of China Mobile and China Unicom.

The acquisition allows AsiaInfo to fully capitalize on the tremendous growth opportunity of the operation support system market, one of the fastest growing areas of telecom investment over the next few years. This acquisition will also increase AsiaInfo's market share significantly, vaulting AsiaInfo to undisputed number one position in the wireless BOSS market in China.

The Bonson has been financially consistently profitable since 1999. Based on Bonson's management accounts, Bonson had approximately US$6.9 million, US$2.4 million and US$2.2 million in net revenue, operating profit and net income, respectively, in 2000. For the first nine months in 2001 Bonson recorded US$6.2 million, US$1.6 million and US$1.5 million in net revenue, operating profit and net income, respectively. On an annual basis, the management estimates the company to achieve US$8.3 million, US$2.6 million and US$2.4 million in net revenue, operating profit and net income, respectively. Net revenue, operating profit and net income is expected to grow to US$12-13 million, US$4.5-5.5 million and US$3.5-4.5 million, respectively in 2002. The company's revenue visibility is built on the strength of its estimated US$8.0 million net sales backlog at the end of 2001.

Fan Bao, Senior Vice President and Chief Strategy Officer of AsiaInfo, remarked, "The BOSS market in China has largely been fragmented with over a dozen of players. However, our customers have grown more sophisticated and sought fewer vendor partners to offer them best products and service in longer term. This acquisition is in direct response to our customers' requirement and will introduce a new wave of industry consolidation."

In a separate press release today, the company also announced record fourth quarter and year-end results for the period ended December 31, 2001.

Conference Call

AsiaInfo will host a conference call to discuss details of this transaction along with its fourth quarter and year-end results at 4:00 p.m. Pacific Time / 7:00 p.m. Eastern Time (Beijing/Hong Kong Time: January 23, 2002 at 8:00 a.m.). The management team will be on the call to discuss the recent acquisition, results and highlights, provide financial guidance for 2002, and answer questions. The dial-in number for the call is 973-872-3100. A replay will be available by dialing 877-519-4471 for US callers or 973-341-3080 for international callers with a personal identification number (PIN) of 3033213 between 4:00 p.m. Pacific Time on January 22, 2002 until 4:00 p.m. Pacific Time on February 23, 2002.

Live and archived web casts of this call also will be available on the Investor Relations section of the AsiaInfo web site at www.asiainfo.com.

About AsiaInfo Holdings, Inc.

AsiaInfo Holdings, Inc. (Nasdaq:ASIA) is a leading provider of telecom network integration and software solutions in China. Its customer management and billing software products meet the complex, mission-critical provisioning, accounting, reporting and marketing needs of Internet and telecommunications service providers. The company's convergent software suite also includes carrier-scale messaging and network management products. AsiaInfo constructs backbones, provincial and access networks for China's telecom carriers while providing high-end network solutions including operations support, network management and security, and service applications.

Registered in Delaware, AsiaInfo has served as a chief architect of China's Internet infrastructure since 1995, crafting Internet backbones for all the major national carriers including China Telecom, China Mobile, China Unicom, and China Netcom.

For more information about AsiaInfo, please visit http://www.asiainfo.com.

About Bonson Technology Limited

Founded in 1994, Bonson Information Technology Limited ("Bonson" or the "Company") is the leading developer of communications software and solutions for China's rapidly growing mobile communications market. The Company develops and sells mobile business operation support system software and solutions (including billing, accounting, settlement, customer care, customer relationship management and decision support systems), wireless value added services platforms and network management systems, mainly for mobile services.

Bonson has about 200 employees and is headquartered in Guangzhou, China.

The statements in this news release contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ from anticipated results. Further information on risk factors that could affect AsiaInfo's results of operation are detailed in AsiaInfo's registration statement, as filed with the Securities and Exchange Commission. A copy of the registration statement, including exhibits, may be reviewed at the Commission's public reference room at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. The registration statement and other company filings can also be reviewed by accessing the Commission's Internet site at http://www.sec.gov, which contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission.