Pace proposed acquisition of 2Wire, Inc.

The combination of Pace and 2Wire widens Pace's US reach into the telco market

Saltaire, UK and San Jose, CA, USA - July 25, 2010 - Pace plc ("Pace") and 2Wire, Inc. ("2Wire") today announce that the companies have reached an agreement under which Pace proposes to acquire 2Wire for cash consideration of $475 million.  The consideration includes 2Wire's balance sheet cash at closing, expected to be approximately $55 million.

Neil Gaydon, Chief Executive Officer of Pace plc, commented:

"This acquisition will strengthen our Americas business, extending Pace's US market coverage with entry into the tier one telco market.  We have built a strong position in the US with cable and satellite operators and 2Wire, with its expertise in the broadband residential gateway market, will enable us to address a full range of US operator requirements.  2Wire's software and gateway expertise will further drive development of our home entertainment convergence strategy.  The transaction introduces deep client relationships with important customers including AT&T and further develops our platform to deliver ongoing sustainable growth."

"We admire 2Wire's technology and the position they have built as an acknowledged leader in the telco gateway market.  We look forward to working together."

Pasquale Romano, Chief Executive Officer of 2Wire, added:

"Pace is an excellent strategic fit for the 2Wire business and will enable us to take our products and services to the next level of their development.  The combined customer base, engineering capability and product breadth of Pace and 2Wire make this a compelling transaction for our customers, our employees and our end users globally."

Tim Harden, President - Supply Chain and Fleet Operations, AT&T, commented:

"AT&T looks forward to continuing our working relationship with 2Wire under Pace's ownership."

Following the completion of the acquisition, Pace, already the number one global digital set-top box company, would also become the number one provider of telco residential gateway devices in the US and the number three provider globally.

2Wire is currently owned by a consortium of strategic and financial investors including Alcatel-Lucent, AT&T, Telmex, Oak Investment Partners, Meritech Capital Partners, and Technology Crossover Ventures.

The transaction is conditional on (amongst other things) the approval of the shareholders of Pace and 2Wire and regulatory approvals.  It is anticipated that the transaction will be completed during the fourth quarter of 2010.

About Pace plc
Pace plc (LSE:PIC) is a leading technology developer for the global payTV industry, working across satellite, cable, IPTV and terrestrial platforms.  Pace has one of the world's most experienced specialist engineering teams, developing intelligent and innovative products and services for both payTV operators and retail markets across the world.

Pace employs over 1,000 people in locations around the world, including France, the US, India and China.  Pace's international headquarters are in Saltaire, West Yorkshire, UK. For more information on Pace, please visit www.pace.com.

About 2Wire
Engineered for the carrier and optimised for the subscriber, 2Wire broadband solutions provide simple, powerful user experiences. 2Wire products and services include residential gateways, multi-service media platforms, remote management systems, value-added services, customer support, and end-to-end integration and professional services. 2Wire customers are leading broadband providers throughout the US, Canada, Latin America, Europe, Australia, and Asia, including AT&T, Bell Canada, Telmex, BT, SingTel, and others. For more information, visit www.2wire.com.

2Wire is a registered trademark of 2Wire, Inc. in the United States and in other jurisdictions throughout the world.

Advisors
Evercore Partners are acting as financial advisor and Gibson Dunn & Crutcher LLP and Travers Smith LLP are acting as legal counsel to Pace in connection with the transaction.  Barclays Capital are acting as financial advisor and Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP and Taylor Wessing LLP are acting as legal counsel to 2Wire.

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