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November 2, 2009

CDC Global Services to acquire stake in Jiangsu Microsoft Technology Center

To expand IT and R&D outsourcing services in China

By CBR Staff Writer

CDC Global Services, a provider of consulting, IT and IT-enabled professional services, said that it has executed a term sheet with the Nanjing High-Tech Zone to acquire a 35% stake, with an option for up to a 51% stake in Sowell, known also as the platform of Jiangsu Microsoft Technology Center, that is expected to fuel the company’s rapid expansion into the China’s IT outsourcing services market.

Sowell operates its ITO businesses, which also include R&D outsourcing services, in Nanjing, Wuxi, Suzhou and Huaian. Jiangsu Microsoft Technology Center provides research and development services to Microsoft.

The investment comes as part of CDC Global Services’ plans to build more IT and R&D outsourcing services in China. Sowell provides IT and research and development services that complement CDC’s business which includes IT and business process outsourcing services in India and China. Sowell’s ITO services include onsite and remote IT support/help desk, IT infrastructure planning, custom/offshore application development, network management and administration and application maintenance and support.

Wong, chairman of CDC Global Services, said: “We expect that this planned acquisition will serve as the launch pad for expanding our IT/R&D outsourcing capabilities in China to serve our global clients.

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As part of our acquisition strategy, Sowell is expected to serve as the platform for rolling up other Microsoft Technology Centers and expanding our services throughout China. This is a key part of our strategy in seeking strategic initiatives that may include acquisitions, partnerships and investments that will help CDC Global Services grow and increase its market share in the high growth outsourcing services market.

“This planned acquisition is part of our strategic initiative to build CDC Global Services into one of the world’s leading R&D and IT outsourcing centers for premier technology companies like Microsoft.

However, the acquisition stake in Sowell is subject to several customary closing conditions.

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