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Softchoice Corporation Acquires Optimus Solutions

January 2, 2008

Press Release Source: Softchoice Corporation

Toronto, January 2nd, 2008 - Softchoice Corporation (TSX: SO), announced today that it is continuing the implementation of its U.S. growth strategy with the acquisition of Optimus Solutions. Optimus Solutions is a comprehensive IT products and solutions company focused on helping enterprise and mid-market clients plan, build and maintain their information technology infrastructure with headquarters in Norcross Georgia, and nine offices in the United States. Today, Softchoice entered into a definitive purchase and sale agreement and expects that the acquisition will close this week, subject to normal closing conditions.

Under the terms of the agreement Softchoice is paying US$38.1 million in cash to acquire the privately held company with a deferred payment of up to US$9 million, payable during 2008 depending on the financial performance of Optimus Solutions. On a trailing 12-month basis, Optimus Solutions generated US$140 million in revenue. Approximately 40 percent of Optimus' revenue during this period was derived from the enterprise market segment, 50 percent from the mid-market segment and 10 percent from the public sector. Approximately 87 percent of this revenue is from hardware sales, 7 percent is attributable to the sale of software, and the remainder from services. Optimus employs 100 people and services 1500 customers with no single customer representing more than 12 percent of total revenues. Softchoice expects the transaction will be accretive to earnings in 2008. Funding for the transaction was provided by a loan from a Canadian chartered bank.

The acquisition significantly enhances Softchoice's ability to provide advanced hardware technology solutions and services, including internetworking, server consolidation, and security solutions to U.S. mid-market, enterprise and public sector organizations.

Benefits from the transaction include the following:

  • Completes Softchoice's market coverage by enabling the Company to deliver hardware solutions across all U.S. market segments;
  • Extends Softchoice's Microsoft Enterprise Agreement expertise, virtual supply chain technology and TechCheckâ„¢ assessment services to Optimus Solutions' customer base;
  • Broadens Softchoice's customer platform in the U.S. and supports the Company's overall strategic plan to grow its market share along three dimensions - (1) in both hardware and software sales; (2)in Canada and the U.S.; (3) and across the mid-market, enterprise and public sector segments.

"Through our growth strategy we've extended the Softchoice platform across all key product and market segments, creating a springboard for the next phase of our growth," said David MacDonald, President and CEO of Softchoice. "With the acquisition of Optimus Solutions, we now have the ability to help customers address virtually every stage of the technology lifecycle - from solution design, fulfillment and implementation through to disposal. Looking ahead, our focus is on leveraging these assets to achieve our goal of becoming one of the top five solutions providers in North America. Through this process we look forward to enhancing the value we provide our customers, creating growth opportunities for new and existing employees and maximizing returns for our shareholders."

Softchoice's success as a leading technology provider in Canada and to the U.S. mid-market coupled with strategic investments in its high velocity supply chain has laid the foundation for the current phase of the Company's growth strategy. Since October 2007, Softchoice has leveraged selective acquisitions to increase its reach in key market segments and enhance customer value. On October 12th 2007, Softchoice acquired the Technology Solutions and Professional Services divisions of NexInnovations, a Canadian-based enterprise solutions provider. Two months later, on December 11th, Softchoice completed the acquisition of Software Plus, the ninth largest Microsoft LAR in the U.S. and a leading provider to enterprise and academic organizations. The acquisition of Optimus Solutions complements these previous transactions in terms of market focus and regional presence. Management believes the transaction will strengthen Softchoice's ability to serve the hardware technology requirements of U.S.-based enterprise and public sector organizations while providing the opportunity to extend the Company's expertise in IT assessments and software licensing to an entirely new set of customers.

"Optimus and Softchoice both bring distinct, industry-leading capabilities to the mix," said Steve Johnson, President of Optimus Solutions, who will become a Vice President of Softchoice. "As a value-based organization, we have an intense focus on working closely with key partners such as Cisco and IBM to deliver advanced IT solutions to U.S. businesses. Combining this expertise with Softchoice's fulfillment engine, its standing as a top Microsoft LAR and its geographic reach will give our people the opportunity to augment our services expertise with a much more competitive set of volume-based offerings. Ultimately this is about giving our customers and our people the best of all worlds."

The management team is pleased to report that Steve Johnson will carry on in his capacity as President of Optimus Solutions for a minimum of two years.

About Softchoice
As one of North America's leading providers of technology solutions and services, Softchoice helps businesses and organizations of all sizes to select, acquire and manage their software and hardware technology resources. Softchoice offers a full range of capabilities, including face-to-face consultations and IT asset management services designed to help customers save time, money and risk in IT procurement. In 2006, Softchoice was named Software Value Added Reseller (VAR) of the Year by VAR Business magazine. Softchoice currently has more than 800 employees operating from more than 40 branch offices located in major cities across the U.S. and Canada.

Softchoice stock is listed on the Toronto Stock Exchange (TSX) under the trading symbol "SO". The Common Shares of Softchoice are not registered under the U.S. Securities Act of 1933 and are not publicly traded in the United States.

About Optimus Solutions
Optimus Solutions provides comprehensive IT solutions designed to streamline and integrate business processes across the enterprise. Optimus provides solutions that assist customers in integrating their business with partners, suppliers, and customers. The Company does this through a comprehensive range of integration and consulting services, as well as hardware, software, and storage product offerings. Optimus is a Value Added Reseller (VAR) for Cisco and IBM systems and software (System i, p, x, and Storage).

Forward-looking Statements
This press release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements relate to, among other things, plans and timing for the introduction and enhancement of our services, and other expectations, intentions and plans contained in this press release that are not historical fact. When used in this press release, the words "anticipate," "expect" and similar expressions generally identify forward-looking statements. These statements reflect our current expectations and are subject to a number of risks and uncertainties including, but not limited to, our ability to integrate the business of Software Plus with our own, including the ability to maintain its customers, the ability to eliminate costs, and changes in technology and general market conditions, many of which are set out or incorporated by reference in the Company's latest Annual Information Form. Due to the many risks and uncertainties, Softchoice cannot assure that the forward-looking statements contained in this press release will be realized.

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