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Bowne Sells Globalization Business to Lionbridge

Press release from the issuing company

NEW YORK, June 27 -- Bowne & Co., Inc. announced today that it has entered into a definitive agreement to sell Bowne Global Solutions to Lionbridge Technologies, Inc., a provider of globalization and testing services, for a total sale price with a value of at least $180 million. Bowne Global Solutions (BGS) provides language and cultural solutions that use translation, localization, technical writing and interpretation services to help companies adapt their communications or products for use in other cultures and countries around the world. "This transaction is a significant step in Bowne's continuing efforts to sharpen our focus on the core business upon which our company has been built," said Bowne Chairman and Chief Executive Officer Philip Kucera. "We believe this transaction provides significant benefits to Bowne shareholders by unlocking the value of BGS. Bringing together BGS and Lionbridge will benefit both companies' clients, employees and shareholders." "This combination is strategically compelling. We are leveraging the combined capabilities of two successful organizations," said Rory Cowan, Chairman and Chief Executive Officer of Lionbridge Technologies. "Customers will benefit from a unified commitment to service excellence, the most advanced technology-enabled services and the efficiencies that joining the two companies will bring. Our employees will benefit from our shared traditions of growth, innovation and career advancement. Shareholders will benefit from the combined efficiencies, broadening of revenues and industry leadership." Under the terms of the agreement, the consideration consists of at least $130 million in cash and 9.4 million shares of Lionbridge common stock. If the shares issued to Bowne do not have a value of $50 million at the time of closing, Lionbridge will issue a subordinated note to Bowne of up to $20 million to bring the value of the shares, together with the note, to $50 million. If the shares have a value greater than $68 million, the number of shares will be reduced so that the value is no greater than $68 million. Bowne will also receive one seat on the Lionbridge Board of Directors. The Bowne Board of Directors is reviewing plans for the proceeds from the sale. Alternatives under review include further investment in the core businesses (including strategic acquisitions), debt retirement, share repurchases and/or cash dividends. Bowne currently has authorization for the buyback of up to $35 million of the company's common stock. The transaction is subject to customary closing conditions. Goldman, Sachs & Co. served as the financial advisor to Bowne. The Company stated that its full-year guidance, regarding BGS' revenue of $225 to $265 million and segment profit of $19 to $24 million, is unchanged from the outlook provided April 28, 2005.