Avenue Capital Management LP acquires more than 5 percent in SMARTRAC N.V.

--------------------------------------------------------------------------------
ots.CorporateNews transmitted by euro adhoc. The issuer is responsible for
the content of this announcement.
--------------------------------------------------------------------------------

Amsterdam, 25 October 2006. SMARTRAC, the leading supplier of inlays
for contactless ePassports, announced today that on 17 October 2006,
US asset-management company Avenue Capital Management LP reported it
is holding an equity stake of 5.93 percent in the company. SMARTRAC
is listed in the Prime Standard of the Frankfurt Stock Exchange since
July 2006.

SMARTRAC is well positioned to benefit from the enormous growth in
RFID-applications and as a core shareholder, Avenue Capital will
support the development of SMARTRAC`s leading position, particularly
in High Security RFID inlays.

"With Avenue Capital we have an investor in our company that is
familiar with our industry and dedicated to developing the liquidity
in our stock" said Dr. Christian Fischer CFO of SMARTRAC N.V. The New
York based investment company Avenue Capital has more than USD 10bn
assets under management and follows well-developed investment themes.

On 16 August 2006, SMARTRAC reported that this year’s first-half
revenues (January to June) nearly doubled compared with the same
period of 2005, to EUR 22.5 million, while first-half earnings (Group
EBITDA) more than tripled to EUR 4.7 million. The company has been
profitable every year since its foundation.

About SMARTRAC N.V. SMARTRAC is a leading supplier of inlays for
contactless ePassports and contactless credit cards (ePayment). The
company, which was founded in 2000, is incorporated under Dutch law
and has its head office in Amsterdam. SMARTRAC has its main
production and R&D centre in Bangkok (Thailand), as well as sales
offices in Stuttgart and Singapore. Through an agreement with Xytec
Solutions (Kulim, Malaysia), in which SMARTRAC holds a 30% stake, the
company has exclusive access to proprietary manufacturing equipment.
In two product segments - Standard and High Security - SMARTRAC
manufactures components for RFID applications in public transport,
access control and logistics, as well as in the high-security
applications of ePayment and ePassports.

end of announcement euro adhoc 25.10.2006 10:37:57
--------------------------------------------------------------------------------

ots Originaltext: SMARTRAC N.V.
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:
Max Hohenberg
Media Relations SMARTRAC N.V.
Tel: +49 711 6569 2616
Email: max.hohenberg@smartrac-group.com

Branche: Technology
ISIN: NL0000186633
WKN: A0JEHN
Börsen: Frankfurter Wertpapierbörse / official dealing/prime standard
Börse Berlin-Bremen / free trade
Baden-Württembergische Wertpapierbörse / free trade
Börse Düsseldorf / free trade
Bayerische Börse / free trade