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Scitex and KBA Recast Karat Joint Venture, KBA Takes Charge

Press release from the issuing company

Herzlia, Israel and Radebeul, Germany; March 14, 2001-- KBA, one of the largest press manufacturers in the world, is taking charge of all development, marketing, production and service activities for the computer-to-press 74 Karat. According to a statement issued by KBA and Scitex, the joint-venture agreement of January 1, 1998 to create the 50:50 subsidiary Karat Digital Press B.V. in Amsterdam (Netherlands), with associated companies Karat Digital Press GmbH in Radebeul (Germany) and Karat Digital Press LP in Herzlia (Israel), will be terminated. Under the terms of the new agreement, which is still being negotiated, Scitex will transfer its share of Karat Digital Press to KBA in return for future performance-related payments. As a consequence of KBA's purchase of Scitex' share of Karat, Karat Digital Press GmbH, with its 130 staff, will become a wholly owned subsidiary of KBA, and KBA will be responsible for manufacturing, sales and customer support operations of Karat Digital Press machines worldwide. Imaging technology and front-end software will still come from Israel as before. Karat Digital Press, North America Inc. has become a division of KBA, North America, and will continue to serve as the focal point of 74 Karat sales, marketing and service operations in North America from its headquarters in Fairfield, NJ. The changes follow the decision last spring by Scitex and Creo (Canada) to merge their pre-press and digital front-end activities, as a result of which Scitex has realigned its operations. The 74 Karat went into serial production in May 2000, just before Drupa show in Düsseldorf, Germany. By the end of January this year over 40 units had been sold and more than 20 of these are on stream in Europe and North America. Users' verdicts on the print quality, proof-matching integrity, cost efficiency and handling of this waterless offset press with keyless Gravuflow(TM) inking units and standardized process sequences have been overwhelmingly positive, especially with regard to digitally integrated distributed print production. Interest is growing fast not only among traditional print entrepreneurs but also among pre-press providers looking to cross the print threshold. KBA to Intensify and Globalize Sales Activities Management at KBA and Karat is confident that the re-alignment will enable both companies to enhance their impact in the global market. For 2001 they are targeting a dramatic boost in orders by intensifying sales activities and expanding the distribution channel for the 74 Karat press.