Redline announces directors' approval of proposed capital reorganization in connection with a Toronto Stock Exchange and AIM offering



    /NOT FOR DISTRIBUTION IN THE UNITED STATES/

    Redline Communications, Inc.
    ("Redline" or the "Company")

    TORONTO, Sept. 26 /CNW/ - Redline's (AIM: REDL) board of directors
announced today that they have approved a proposed capital reorganization of
the Company's common stock (the "Reorganization"). Subject to stockholder
approval, upon completion of the Reorganization and the Offering (as defined
below), Redline will become a partially-owned subsidiary of Redline
Communications Group Inc. ("RCG"), a newly formed holding company incorporated
under the laws of Canada, which will be admitted to trading on the AIM market
of the London Stock Exchange plc ("AIM") and which intends to list on the
Toronto Stock Exchange ("TSX"). As a result, the existing Redline stockholders
will become (unless they elect otherwise) stockholders in RCG.
    RCG filed a preliminary prospectus today with the securities regulatory
authorities in each of the provinces and territories of Canada (other than the
province of Quebec) in order to qualify the proposed initial public offering
of its common shares (the "Offering") in anticipation of the listing of the
same on the TSX. The Offering will include both a treasury offering by RCG and
a secondary offering by certain selling shareholders. The underwriting
syndicate for the Offering is being co-led by CIBC World Markets Inc. and
Canaccord Capital Corporation.
    Upon closing of the Reorganization and completion of the Offering, the
admission of Redline's common stock to trading on AIM will be cancelled.
Simultaneous with such cancellation, the closing of the Offering and the
listing of RCG's common stock on the TSX, the common shares of RCG will be
admitted to trading on AIM.
    Subject to stockholder approval, the Reorganization will be accomplished
by a merger (the "Merger") of a wholly owned acquisition vehicle with and into
Redline pursuant to the Delaware General Corporation Law. Following
stockholder approval and subject to the TSX listing and AIM admission, holders
of the common stock of Redline who do not elect otherwise will receive shares
of a class of common stock that will be automatically redeemed by Redline for
common shares of RCG in connection with the TSX listing and AIM admission.
Alternatively, holders of the common stock of Redline may make an election to
receive shares of a class of stock which are redeemable at the option of the
holder by Redline at any time after the TSX listing and AIM admission for
common shares of RCG. Details of the Reorganization will be sent to
stockholders with the proxy circular convening the special meeting of
stockholders to consider the approval of the Merger.

    This press release does not constitute an offer to sell or a solicitation
of an offer to sell common shares of Redline in the United States. These
securities have not been and will not be registered under the United States
Securities Act of 1933, as amended (the "U.S. Securities Act") or any state
securities laws and may not be offered or sold in the United States except in
compliance with the registration requirements of the U.S. Securities Act and
applicable state securities laws or pursuant to an exemption therefrom.

    About Redline Communications, Inc.

    Redline is the leading provider of standards-based wireless broadband
solutions. Redline's RedMAX(TM) WiMAX Forum Certified(TM) systems, RedMAX
4C(TM) Mobile WiMAX products and award-winning RedCONNEX(TM) family of
broadband wireless infrastructure products enable service providers and other
network operators to cost-effectively deliver high-bandwidth services
including voice, video and data communications. Redline is committed to
maintaining its wireless industry leadership with the continued development of
WiMAX and other advanced wireless broadband products. With more than 50,000
installations in 80 countries, and a global network of over 100 partners,
Redline's experience and expertise helps service providers, enterprises and
government organizations roll out the services and applications that drive
their business forward. For more information, visit
www.redlinecommunications.com.

    Forward-Looking Statements

    Any forward-looking statements in this press release are based on current
expectations that are subject to significant risks and uncertainties that are
difficult to predict. Actual results may differ materially from projections
suggested in any forward-looking statements due to a number of risks including
those associated with the business of Redline, the proposed offering and
regulatory matters. Redline assumes no obligation to update the
forward-looking statements, or to update the reasons why actual results could
differ from those reflected in the forward-looking statements. Readers are
cautioned not to place undue reliance on forward-looking statements.
Additional information identifying risks and uncertainties are contained in
RCG's preliminary prospectus filed with the Canadian securities regulatory
authorities, available at www.sedar.com.

    NOTE: All registered and unregistered trademarks mentioned in
    this release are the property of their respective owners.





For further information:

For further information: Redline Communications, Tom Hearne, Chief
Financial Officer, Carolyn Anderson, Communications Director,
canderson@redlinecommunications.com, Tel: (905) 479-8344; Buchanan
Communications, Jeremy Garcia, James Strong, Bobby Morse,
jeremyg@buchanan.uk.com, Tel: +44 (0)20 7466 5000; Canaccord Adams, Chris
Bowman, Tel: +44 (0)20 7050 6500


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890