Esmertec Announces Sale of Majority Stake in Japanese Subsidiary

Esmertec(TM) (SWX:ESMN), a focused provider of software and
services to communications device manufacturers and mobile telecom
operators, announced today that the management and employees of
Esmertec KK (Tokyo) have formed a partnership and have purchased a 62%
stake in Esmertec KK, Esmertec's subsidiary in Japan, reducing
Esmertec AG's interest in the Japanese company to slightly under 20%.
The remaining shares in Esmertec KK continue to be held by certain
sellers of eValley, a predecessor company to Esmertec KK. The
transaction is effective as of September 29, 2006.

The sale of the majority stake in its Japanese subsidiary is
consistent with Esmertec's strategy of focusing its global sales
efforts through direct sales channels in strategic markets. The
management buy-out will support Esmertec in its efforts to optimize
its cost structure while efficiently addressing the Japanese market
through a dedicated reseller who knows Esmertec's products and
markets. Consequently Esmertec KK will continue to be the exclusive
reseller of Esmertec Mobile and Multimedia software products in Japan.

"The management buy-out is a great opportunity for our management
team to continue to build a successful business from a solid base",
stated Naoki Iizuka, CEO of Esmertec KK. "There is a strong and
growing market opportunity for an embedded software solution provider
in Japan and our technology and products are the best fit for this
market."

Jean-Claude Martinez, CEO of Esmertec AG, commented: "This
transaction allows us to focus our resources on key markets where we
continue to strengthen our sales force. Japan remains an attractive
market and we will continue to cooperate with Naoki Iizuka and the
Esmertec KK team in the future. Our existing customers will experience
the same high service level they have been receiving from Esmertec."

The purchase of Esmertec KK shares was financed by a combination
of cash and debt. Both parties have agreed not to disclose the
financial details. The transaction is not expected to have any
material impact on Esmertec AG's financial results for the year ending
December 31, 2006.

This communication contains forward-looking statements based on
current expectations and assumptions of the company's management only,
and involve certain risks and uncertainties. The forward-looking
statements contained herein could be substantially impacted by risks
and influences that are not foreseeable at present, so that actual
results may vary materially from those anticipated, expected, or
projected. Esmertec disclaims any intention or obligation to update
and revise any forward-looking statements, whether as a result of new
information, future events or otherwise.

Esmertec, Jbed and OSVM are trademarks of Esmertec AG. Java is a
trademark of Sun Microsystems, Inc. Other names may be trademarks of
their respective owners.

About Esmertec

Esmertec is a focused provider of software and services to
communications device manufacturers and mobile telecom operators. The
company provides software platforms that enable the deployment of
content and applications in devices and over servers. Customers
include mobile telecom operators and manufacturers of mobile handsets,
set-top boxes and interactive televisions. Esmertec's software and
service capabilities excel with its reliability as well as fast and
local execution. Founded in 1999, Esmertec is headquartered in Zurich,
Switzerland with subsidiaries in China, France, Japan, South Korea,
and the USA, and offices in Taiwan and the UK. Since 2005, Esmertec
has been listed on the SWX Swiss Exchange (ESMN). www.esmertec.com