DragonWave Inc. Announces Pricing of Common Share Offering



    /THIS NEWS RELEASE IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES
    NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/

    OTTAWA, Sept. 7 /CNW/ - DragonWave Inc. ("DragonWave" or the "Company")
(TSX: DWI, AIM: DWI) is pleased to announce that in connection with the
proposed public offering of common shares previously announced on September 6,
2007, it has entered into an underwriting agreement with a syndicate of
underwriters led by Canaccord Capital Corporation and including CIBC World
Markets Inc., Genuity Capital Markets G.P., Orion Securities Inc. and Raymond
James Ltd. (collectively, the "Underwriters") for the purchase by the
Underwriters of 3,800,000 common shares issued from treasury and
3,200,000 common shares to be sold by certain selling shareholders, at a price
of C $6.25 ((pnds stlg)2.94) per common share, for aggregate gross proceeds of
C $43,750,000 ((pnds stlg)14,880,952) (the "Offering").
    The Company has granted the Underwriters an over-allotment option (the
"Over-Allotment Option"), exercisable for a period of 30 days following the
closing of the Offering, to purchase up to that number of common shares equal
to 15 percent of the number of common shares sold pursuant to the Offering. If
the Over-Allotment Option is exercised in full, the gross proceeds of the
Offering will increase to C$50,312,500 ((pnds stlg)17,113,095).
    As previously announced, the net proceeds from the proposed treasury
offering will be used by the Company primarily to continue to fund its efforts
to increase sales penetration in regions outside North America, to fund
development of the Company's next generation of wireless Ethernet products and
related improvements to existing products, to engage in marketing efforts to
further raise the Company's profile, to strengthen the Company's balance
sheet, to provide an available source of funding for potential future
acquisition opportunities and for general corporate purposes.
    A preliminary short-form prospectus for the Offering was filed with the
securities commissions in each of the provinces of Canada (except Quebec) on
September 6, 2007. An amended preliminary prospectus for the Offering will be
filed today in each of the provinces of Canada (except Quebec) to include
pricing and other terms of the Offering. A (final) short-form prospectus is
expected to be filed with each of the Canadian securities commissions (except
Quebec) as soon as possible after regulatory approval.
    The Offering is expected to close on or about September 20, 2007.
    This press release is not an offering of securities for sale in the
United States. The common shares have not been registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or sold in the
United States absent registration or an exemption from the registration
requirements of that Act.

    ABOUT DRAGONWAVE

    DragonWave(TM) is a leading provider of high-capacity wireless Ethernet
equipment used in emerging IP networks. DragonWave designs, develops, markets
and sells proprietary, carrier-grade microwave radio frequency networking
equipment, or links that wirelessly transmit broadband voice, video and other
data. DragonWave's wireless Ethernet products, which are based on a native
Ethernet platform, function as a wireless extension to an existing fibre-optic
core telecommunications network. The principal application for DragonWave's
products is to perform the backhaul function in a wireless communications
network. Additional applications for DragonWave's products include
point-to-point transport in private networks, including municipal and
enterprise networks. DragonWave's corporate headquarters are located in
Ottawa, Ontario, and have sales locations in Europe and North America.

    Investors and security holders may obtain the preliminary prospectus free
of charge on SEDAR website maintained by the Canadian Securities
Administrators at http://www.sedar.com, a link to the same is also available
on the Company's website www.dragonwaveinc.com.

    CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION

    Certain statements included in this news release constitute "forward
looking" statements within the meaning of securities laws.
    Forward-looking information may relate to our future outlook and
anticipated events or results and, in some cases, can be identified by
terminology such as "may", "will", "should", "expect", "plan", "anticipate",
"believe", "intend", "estimate", "predict", "potential", "continue", or other
similar expressions concerning matters that are not historical facts.
    These statements are based on certain factors and assumptions including
expected growth, results of operations, performance and business prospects and
opportunities. While we consider these assumptions to be reasonable based on
information currently available to us, they may prove to be incorrect.
    Forward looking-information is also subject to certain factors, including
risks and uncertainties that could cause actual results to differ materially
from what we currently expect. These factors include changes in market and
competition, governmental or regulatory developments and general economic
conditions.

    %SEDAR: 00024992E




For further information:

For further information: INVESTOR RELATIONS CONTACT: Russell Frederick,
CFO, DragonWave Inc, Tel: (613) 599-9991 ext: 2253, Fax: (613) 599-4225,
E-mail: investor@dragonwaveinc.com; Nadine Kittle, DragonWave Inc., Media
Relations, (613) 599-9991 ext. 2262, Email: nkittle@dragonwaveinc.com; John
Moriarty, Weber Shandwick Financial (for DragonWave), Tel: 020 7067 0736, Mob:
07971 402224, jmoriarty@webershandwick.com; AIM NOMAD, Chris Bowman, Andrew
Chubb, Canaccord Adams Limited, +44 20 7050 6500


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