March Networks to be Acquired by Infinova (Canada) Ltd. in a C$5.00 Per Share All-Cash Transaction

OTTAWA, Dec. 9, 2011 /PRNewswire/ - March Networks® (TSX:MN), a global provider of intelligent IP video solutions, today announced that it has entered into a definitive agreement (the "Arrangement Agreement") with Infinova (Canada) Ltd. ("Infinova") and Shenzhen Infinova Ltd. ("Shenzhen Infinova"), a company listed on the Shenzhen Stock Exchange (SHE:002528), majority owned by U.S. shareholders and with U.S. headquarters in Monmouth Junction, N.J. Pursuant to the Arrangement Agreement, Infinova will acquire, through a statutory plan of arrangement, all of the issued and outstanding common shares of March Networks Corporation (the "Company" or "March Networks") for C$5.00 per share in cash (the "Arrangement"). The total value of the transaction is approximately C$90.1 million. The Arrangement is subject to approvals by the shareholders of March Networks and Shenzhen Infinova, approvals of applicable regulatory bodies and the Ontario court, and other customary closing conditions.

"The combined companies create one of the 10 largest global players in the video surveillance industry and is well positioned for the expected industry consolidation over the next five years. Infinova offers March Networks a broader geographic footprint, access to the world's fastest growing market and a complementary fit with our respective product lines. This deal is consistent with our strategy to accelerate growth and expand in the Asian market," said Peter Strom, President and CEO, March Networks.

"March Networks has established itself as one of the leading and most innovative players in the video industry and Infinova is proud to combine forces to take the company to the next level. The acquisition provides scale in all critical markets, as well as access to March Network's proven and innovative IP technology. March will continue to operate independently from its Ottawa headquarters, maintain its name and brands, and deliver on all of its commitments to customers, while taking full advantage of Infinova's manufacturing expertise and R&D scale," said Dr. Jeffrey Liu, Chairman of Infinova.

The Company's Board of Directors (the "Board"), after receiving the recommendation of its special committee (the "Special Committee") and consulting with its financial and legal advisors, has unanimously determined that the Arrangement is fair from a financial point of view to March Networks shareholders and that it is in the best interests of the Company to implement the Arrangement, and has resolved to recommend that Company shareholders vote in favour of the Arrangement at a special meeting of shareholders to be convened for this purpose. Morgan Keegan & Company, Inc., acting as an exclusive financial advisor to the Special Committee with respect to the process of reviewing strategic alternatives available to the Company, has provided an opinion to the effect that the consideration proposed to be paid for the Company shares under the Arrangement is fair, from a financial point of view, to March Networks shareholders. Blair Franklin Capital Partners Inc. has also delivered an opinion to the Special Committee to the effect that the consideration proposed to be paid for the Company shares under the Arrangement is fair, from a financial point of view, to March Networks shareholders. Complete copies of both fairness opinions will be included with the Company's management proxy circular to be prepared and mailed to the Company shareholders in respect of the Arrangement (the "Circular").

The Arrangement represents the culmination of the comprehensive process of reviewing strategic alternatives available to the Company, as announced by March Networks on June 8, 2011. The C$5.00 per Company share offered by Infinova represents a premium of approximately 24% to the closing price of the Company shares on the Toronto Stock Exchange (the "TSX") on June 8, 2011, the last trading day prior to that announcement. On December 8, 2011, the last day preceding today's announcement on which the Company shares traded on the TSX, the TSX closing price of the Company shares was C$4.89.

The directors and certain senior officers of the Company, holding together approximately 22% of the total outstanding Company shares, have entered into voting support agreements with Infinova under which they have agreed to vote their shares in favour of the Arrangement.

The proposed transaction will be implemented by way of a plan of arrangement under the provisions of the Canada Business Corporations Act, requiring the approval of at least 66⅔% of the votes cast at the special shareholder meeting to be called to consider the Arrangement. Following the special meeting, the Ontario Superior Court of Justice will hear an application for a final order approving the Arrangement. Under the Arrangement Agreement, the transaction is also subject to receipt of regulatory approvals in China and Canada and the satisfaction of certain other closing conditions customary in arrangements of this nature. The Arrangement Agreement also provides for, among other things, Board support and non-solicitation covenants (subject to the fiduciary obligations of the Board and an Infinova right to match any superior proposal) as well as the payment of an approximately C$1.4 million termination fee by March Networks or an approximately C$1.4 million break-up fee by Infinova if the Arrangement is not completed in certain circumstances. Infinova will finance the acquisition from available cash and will not require external financing.

The terms and conditions of the Arrangement will be summarized in the Circular, which is expected to be mailed to the Company shareholders in February 2012. A copy of the Arrangement Agreement will be available on SEDAR at www.sedar.com.

The parties expect that the Arrangement will be completed in the fourth quarter of fiscal 2012, subject to the satisfaction or waiver of various closing conditions. Following the closing of the Arrangement, the March Networks shares will be de-listed from the TSX.

Today's announcement and the Arrangement will be discussed on the Company's regularly scheduled quarterly results conference call and webcast on December 9, 2011, at 8:30 a.m. EST (1:30 p.m. UTC). The conference call may be accessed by dialing 1-800-814-4859 (North America) or +1 416-644-3414.

The conference call webcast can be accessed at: http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=3732520.

A replay of the conference call will be available from December 9, 2011 at 10:30 a.m. EST until December 16, 2011 at 11:59 p.m. EST. The replay can be accessed at 1-877-289-8525 or +1 416-640-1917. The replay passcode is 4486391#.

About March Networks

March Networks^® (TSX:MN) is a leading provider of intelligent IP video solutions. For more than a decade, the company has helped some of the world's largest commercial and government organizations transition from traditional CCTV to advanced surveillance technologies used for security, loss prevention, risk mitigation and operational efficiency. Its highly scalable and easy to use Command^™ video management platform incorporates a web-based client interface to enable rapid system deployment and complete system control. It is complemented by the company's portfolio of high-definition IP cameras, encoders, video analytics and hybrid recorders, as well as outstanding professional and managed services. March Networks systems are delivered through an extensive distribution and partner network in more than 50 countries. For more information, please visit www.marchnetworks.com.

* MARCH NETWORKS, March Networks Command and the MARCH NETWORKS logo are trademarks of March Networks Corporation. All other trademarks are the property of their respective owners.

About Infinova

With solutions that enable end-users to extend the life of their existing analog equipment by having it co-exist with their new IP video equipment, Infinova provides megapixel, IP and analog surveillance cameras, specialized cameras, core equipment for video control rooms, fiber optic communications, access control products and customized systems. Infinova is acknowledged for its exceptional customer service programs and as "the Integrator's Manufacturer." Infinova has provided security solutions for major projects including the Port of Miami, Shanghai 2010 World Expo, the Panama Canal, Italy's Autovie Venete Motorway, the Bangalore (India) toll surveillance system, Kuwait International Airport, the 2010 Asian Games, the Los Angeles MTA and many others.

Certain statements included in this release constitute forward-looking statements, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend" and similar expressions to the extent they relate to the Company or its management. The forward-looking statements are not historical facts but reflect the Company's current assumptions and expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current assumptions and expectations. The completion of the Arrangement is subject to a number of terms and conditions, including, without limitation: (i) required shareholder approvals, (ii) required Court approval, (iii) required regulatory approvals, and (iv) certain termination rights available to the parties under the Arrangement Agreement. These approvals may not be obtained, the other conditions to the transaction may not be satisfied in accordance with their terms, and/or the parties to the Arrangement Agreement may exercise their termination rights, in which case the Arrangement could be modified, restructured or terminated, as applicable. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks that the parties will not proceed with the proposed transaction, that the ultimate terms of the transaction will differ from those that are currently contemplated, and that the transaction will not be successfully completed for any reason (including the failure to obtain any required approvals or satisfy other conditions). The Company does not intend, and disclaims any obligation, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

SOURCE MARCH NETWORKS CORPORATION