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Sandvine Announces Initial Public Offering on AIM

Sandvine Places 33,526,015 common ordinary shares at 75p per share - Market capitalisation at the placing price of approximately £86million

Waterloo, Ontario; March 21, 2006 - Sandvine today announces that it has raised £20 million before expenses through an institutional placing of 26,666,667 Common Shares at a placing price of 75p per share. In addition, 6,859,348 Common Shares have been placed on behalf of Selling Shareholders, representing a further £5.1 million. The Placing was conducted by Canaccord Adams Limited, the Company’s Nominated Adviser and Broker. Trading in the Company’s shares on the AIM Market of the London Stock Exchange commences today, 21 March, under the ticker “SAND”.

Key Points

• Sandvine through its wholly owned subsidiary Sandvine Incorporated and its subsidiaries (collectively, the “Group”) develops and markets broadband network management equipment and solutions for use by residential broadband service providers.

• The Group’s network management equipment and solutions help broadband service providers identify the types and behaviours of traffic on their networks, with the aim of allowing service providers to improve subscriber satisfaction, reduce operational costs and increase profitability.

• During the third quarter of 2005, the number of installed broadband transmission lines worldwide increased by 25% to 190.3 million from 152.4 million lines. (Source: Point Topic)

• The Placing attracted strong demand from quality institutional investors both in the UK, Continental Europe and North America.

• For the year ending 30 November 2005 Sandvine increased consolidated revenues over 390% to CDN$15.8m (£7.8m) (2004: CDN$3.2m); and reduced losses before interest, tax, depreciation and amortisation by approx. 60% to CDN$3.0m (£1.5m) (2004: CDN$6.2m).

• Some of the Group’s current customers include: Adelphia Communications, Adams, AMNET, BELD, BISCit, CityTel, DirecTV, Manx Telecom, MCTV, Melita Cable, Mountain Cablevision, Peoples Telephone, Seaside Communications, Source Cable & Wireless, Troy Cable and Wightman Telecom.

• The proceeds of the Placing will be used
  • to expand the Group’s sales, marketing and customer support capabilities;
  • to fund the Group’s ongoing research and product development; and
  • to fund general working capital requirements of the Group’s businesses.

• The Directors believe that Admission will:
  • raise the profile of the Group, providing an opportunity to position the Group as a market innovator and technology leader helping to attract new customers;
  • enhance and broaden the Company’s shareholder base;
  • provide the Group with more flexibility for further growth; and
  • give the Group an increased presence and recognition in the UK and Europe where the Group has only recently started to focus a greater marketing and sales effort.

• The Group is headquartered in Ontario, Canada and has a UK office in Basingstoke as well as an APAC office in Hong Kong

• Canaccord Adams Limited acts as both Nominated Adviser and Broker to Sandvine.

David Caputo, Chief Executive Officer & President of Sandvine commented:

“Sandvine has achieved an important milestone towards our next phase in expansion. Broadband growth is a huge phenomenon that is continuing at a strong rate as is the need for Internet Service Providers to understand the nature of residential traffic on their networks.

The strong support shown for this placing from both European and North American investors has been extremely pleasing and I am delighted to be joining the UK market at an exciting time for Sandvine.”

PLACING STATISTICS

Amounts in this document expressed in pounds sterling or equivalent amounts stated in Canadian Dollars have, unless otherwise stated, been calculated using a rate of £1:CD$2.02

The shares have not been, nor will be, registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirement of such Act and applicable state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification under the securities laws of any such jurisdiction. Any public offering of units to be made in the United States would, if made, be made by means of a prospectus that could be obtained from the Company that would contain detailed information about the Company and management as well as financial statements.

For further details

Note

Information in this press release that is not current or historical factual information may constitute forward-looking information within the meaning of securities laws. Implicit in this information, particularly in respect of future operating results and economic performance of the Company, are assumptions regarding projected revenues and expenses.  The Company has assumed continuing strong growth of the worldwide residential broadband access market and an increase in the number of subscribers. These assumptions, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. Readers are cautioned that actual future operating results and economic performance of the Company are subject to a number of risks and uncertainties, including general economic, market and business conditions and could differ materially from what is currently expected as set out above.  Forward-looking information contained in this press release is based on our current estimates, expectations and projections, which we believe are reasonable as of the current date. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While we may elect to, we are under no obligation and do not undertake to update this information at any particular time.

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