Re Agreement

BATM Advanced Communications Limited OEM Supplier Agreement with Alcatel and new contract with major European carrier BATM Advanced Communication (LSE: BVC), an industry leader in network edge technology and IP switching platforms, today announced a major OEM supplier agreement with Alcatel, the global telecoms infrastructure supplier. Under the terms of the agreement, Telco Systems (a wholly owned BATM subsidiary) will supply Ethernet products to Alcatel. BATM was chosen because of its unique technological capabilities and the superior cost / performance characteristics of its products. Dr. Zvi Marom, BATM's CEO said: 'It's a great privilege for us to work with a market leader like Alcatel. Combining their extensive suite of products with our Ethernet products, will create a winning package for the bids for new generation networks which telcos are increasingly inviting. This agreement with Alcatel is another step forward in our relationship with leaders in the communications world. We believe that the BATM reputation for quality and reliability is, and will continue to be, the cornerstone of our achievements in this fast paced industry. We have good reason to believe that additional positive steps will be made in the near future'. BATM is also pleased to report an additional success from this cooperation. A major European carrier has chosen to deploy an Alcatel / BATM solution in its network. As part of a multi service access network contract, Alcatel will supply service extension nodes, including members of the BATM T5 Compact-Layer 3 family. Enquiries: BATM Advanced Communications Ofer Bar Ner - COO +972 9 866 2530 Nitsan Mor - MarCom +972 9 866 2528 Nitsanm@batm.co.il Financial Dynamics James Melville-Ross +44 20 7831 3113 About BATM Advanced Communication BATM is a world leader in the design and supply of IP packet-based systems such as high-capacity, self-routing switches with extensive QoS capabilities. For more information, visit the BATM Advanced Communications web site at www.batm.com Telco Systems is a wholly owned subsidiary of BATM Advanced Communications (London Stock Exchange ticker symbol: BVC). Based in Foxboro, Massachusetts, the company provides industry-leading networking solutions to the carrier and enterprise markets. Telco Systems' focus is to maximize the power of customers' networks by integrating transport, access, and packet technologies onto industry-leading platforms, therefore fully meeting today's and tomorrow's network requirements. For more information, visit the Telco Systems web site at www.telco.com About ALCATEL Alcatel provides communications solutions to telecommunication carriers, Internet service providers and enterprises, delivering voice, data and video applications to their customers. Alcatel leverages its leading position in fixed and mobile broadband networks, applications and services to bring value to its customers in the framework of a broadband world. Alcatel operates in more than 130 countries. For more information, visit them on the Internet : www.alcatel.com