R Systems to Acquire WebConverse, a US based technical support company

Joins select group of service providers having onshore & offshore capabilities

New Delhi, July 26, 2006: R Systems International Ltd. (NSE: RSystems) one of the leading providers of outsourced product development and customer support services today announced that it has signed a definitive agreement to acquire WebConverse, Inc. WebConverse is a technical support company with US operations in Salt Lake City serving the high technology sector with a special focus on the growing mobile applications market. WebConverse achieved revenues of US$ 5.1 million in calendar year 2005. The estimated value of the transaction will be a maximum of $10.7 million inclusive of earn out payments. The acquisition is scheduled to be completed within the next three weeks.

"This acquisition places us in a select group of service providers having onshore & offshore support capabilities", said Rekhi Singh, CEO of R Systems. He added "This coupled with the domain expertise WebConverse has in the rapidly growing mobile applications market, strengthens our value proposition to the high technology sector. Also, given the growth potential of the existing WebConverse client base, we see a near term and long term strategic benefit for all our stakeholders. We welcome WebConverse customers and employees to the R Systems family."

"The combination of R Systems' software development expertise and WebConverse's experience in supporting sophisticated enterprise applications will create a powerful end to end solution for our customers", said Peter Newell, CEO of WebConverse. "Our multi-shore delivery model will enable us to seamlessly match our resources to our customers needs. We look forward to joining the R Systems team and bringing the benefits of the combined company to both our customers and our employees."

About R Systems International Ltd

R Systems International Ltd. founded in 1993, is one of the leading providers of outsourced product development and customer support services. We help companies accelerate the speed to market for their products and services with a high degree of time and cost predictability by using our proprietary pSuite execution framework. Clients can choose services specific to their needs from R Systems iPLM suite of services. We help companies build scalable, configurable and secure products and applications; and help our clients support their customers for products and services using our global delivery model. R Systems rapidly growing customer list includes a variety Fortune 1000, government and mid-sized organizations across a wide range of industry verticals including Banking and Finance, High Technology and Independent Software Vendors, Government, HealthCare, Manufacturing and Logistic Industries. R Systems maintains five centers for Software Excellence, and using our global delivery model we serve customers in the US, Europe, South America, the Far East, the Middle East and Africa.

About WebConverse, Inc

WebConverse Inc., headquartered in San Mateo, CA, was founded in the year 2000 and specializes in delivering outsourced Technical Support for mobile applications, enterprise software, hardware, and hosted applications. WebConverse's turnkey solutions include inbound and outbound telephone support, email response and real-time Web-chat. WebConverse delivers services out of facilities in San Mateo, Salt Lake City, and India. More information on WebConverse is available at http://www.webconverse.com.

Safe Harbor:

This press release contains forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding the success of our investments, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT and consulting services including those factors which may affect our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, industry segment concentration, our ability to manage our international operations, reduced demand for technology and consulting services, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, withdrawal of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. We may, from time to time, make additional written and oral forward-looking statements, and we do not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the Company.

For further information please contact:
Nand Sardana (Tel No. 0120 - 430 3506)