Koala Announces Letter of Intent to Acquire Esemde, Inc.


TORONTO, March 26, 2002 (PRIMEZONE) -- Koala International Wireless, Inc. (OTCBB:KIWI), a leader in the development of web-based, wireless network applications, announced today that it has entered into a letter of intent to acquire 100% of the shares of Esemde, Inc., of Boca Raton, Florida, in exchange for common stock issued by Koala. The transaction is subject to a number of terms and conditions including the completion of mutual due diligence and approval by a majority of each company's shareholders.

Koala is building, through internal development and acquisition, a technology platform that incorporates state-of-the-art encryption and data compression techniques. The technology platform is integrated into a wireless communications device that allows access to a private cellular data network and/or the Internet. This capability enables Koala to exploit several existing complementary opportunities including Point of Sale (POS) and remittance applications that utilize credit and debit transaction processing for the restaurant, hospitality and entertainment industries.

In addition to POS applications, Koala is in the final stage of developing the KIWI, a handheld wireless unit that is one of the most advanced personal telecommunications devices in the world. Basic services include instant messaging, Infrared Modem access, email, Internet browsing, office and business tools functionality, MP3 music player and others. The KIWI can be upgraded to a fully capable cellular phone that uses existing cellular networks. It can provide GPS functionality, extended telematics, screen signature capture, bar code recognition and other applications. The Company is currently evaluating a number of path-breaking compression technologies that are designed to enable wireless devices to deliver 2-way video teleconferencing and larger data packet transfer over GPRS or comparable cellular networks. By enabling the Koala Network central server platform to manage the bulk of the unit's memory and processing capability, instead of locating them on the device, the KIWI can be produced and marketed at a price significantly lower than that of its competitors.

ABOUT ESEMDE INC.

Esemde has created a North America-wide virtual wireless network to provide SMS and GPRS delivery services. SMS and GPRS are data transmission formats used by wireless carriers such as AT&T Wireless, Cingular and Voicestream. This capability enables providers with SMS and GPRS applications, for the Vertical and Enterprise markets, access to nationwide wireless coverage from digital PCS carriers but served by Esemde, Inc.

Esemde has developed and operates an open-architecture platform, comprising a Short Message Service Center (SMSC) and an SMPP/IP proxy server, that allows Short Messaging Services (SMS) to be seamlessly deployed across the multiple wireless standards existing in the U.S., and beyond. The Esemde technology and service capitalizes on the growing need for low-cost, reliable, bi-directional wireless data transmission, delivered nationwide to any SMS or GPRS application.

Microcell Connexions Inc., a subsidiary of Microcell Telecommunications Inc. (TSE:MTI) (Nasdaq:MICT), and Esemde Inc. recently announced that they have entered into an agreement that will allow Esemde to deliver wireless data applications to Canadian business customers using Microcell Connexions' national GSM (Global System for Mobile communications) network.

Stephen Dye, President and CEO of Esemde, Inc., remarked, "Esemde is very excited about the integration of its capabilities into Koala's vision of the future of wireless technology. Esemde is uniquely positioned to ensure functional integration of the Koala Network and the KIWI device into existing GPRS networks. The combined skills and experience of our companies, together, offer a vertically integrated infrastructure that meets the needs of both Koala and Esemde."

Michael Johnston, President and co-founder of Koala, adds, "The agreement to acquire Esemde provides Koala with another ground-breaking advantage in the Virtual Private Wireless Network and Personal Wireless Communications markets. We are delighted to include this vertically integrated company to our family of customers and partners."

This material includes forward-looking statements based on management's current reasonable business expectations. In this document, the words "can," "anticipates," and similar expressions identify certain forward-looking statements. These statements are made in reliance on the Private Securities Litigation Reform Act, Section 27A of the Securities act of 1933, as amended. There are numerous risks and uncertainties that could result in actual results differing materially from expected outcomes. The material should be read in conjunction with the Company's current annual and quarterly reports filed with the SEC, which contain discussions of currently known factors that could significantly impact the Company's future expectations.



            

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