The attached release announces Magic eMerchant v2, the next generation of
Magic's highly customizable and fully functional e-commerce framework.  In
addition to offering such features as complete integration with back-end
and legacy systems, full customization to specific business logic and
processes, personalized pricing, order templates and catalogs, and robust
security, Magic eMerchant v2 provides sophisticated product configuration
capabilities and a multi-tiered architecture to support multiple business
units, stores, outlets and branches.  These are features that are unique in
its price category.  Magic eMerchant runs on most commercial platforms,
including Linux and the IBM iSeries.

Contact:
Katharine Hanley
Magic Software Enterprises
(949) 250-1718 ext. 220
khanley@magicsoftware.com



MAGIC SOFTWARE ENTERPRISES 
RELEASES MAGIC eMERCHANT v2, 
THE NEXT GENERATION OF ITS HIGHLY
CUSTOMIZABLE eCOMMERCE FRAMEWORK

Provides Sophisticated Product Configuration
Capabilities, As Well As a Multi-Tiered Architecture, 
Unmatched in Its Price Category


IRVINE, CA (November 5, 2001) - Magic Software Enterprises (Nasdaq: MGIC), a
leading provider of state-of-the-art development technology and business
solutions, announced today the release of Magic eMerchant(tm) v2, the next
generation of its highly customizable and fully functional e-commerce
framework.   In addition to offering such features as complete integration
with back-end and legacy systems, full customization to specific business
logic and processes, personalized pricing, order templates and catalogs, and
robust security, Magic eMerchant v2 provides sophisticated product
configuration capabilities and a multi-tiered architecture to support
multiple business units, stores, outlets and branches - features that are
unique in its price category.

The Next Generation of eCommerce
Magic eMerchant v2 is a highly customizable e-commerce framework designed to
help businesses enjoy a quick return on investment as the result of expanding
their businesses to the Web. It provides enterprise-level processing power,
robust security, rapid and full integration with back-end corporate and
legacy systems, and easy customization to integrate enterprise business
rules.  In addition, it adds several new and improved features.

Magic eMerchant v2's easy-to-use advanced catalog presentation management
system allows companies to publish dynamic data, static data and unstructured
content within the same page templates.  In addition, its flexible structure
allows presentation sections with their own built-in logic to be moved and
changed dynamically without coding.

Magic eMerchant v2's sophisticated product configuration engine allows
businesses to offer online product configuration based upon rules, product
attributes, or product components.  In addition, it enables customers to
receive up-to-date pricing and details based upon customer specifications
generated on-the-fly.

Using Magic eMerchant v2, companies also can expand their e-commerce sites
easily and quickly to include multiple business units.  Magic eMerchant v2's
advanced multi-tier architecture expands the site to include multiple stores,
business units and departments, each with its own business rules and
administration.  In addition, its multi-level administration ensures that the
host corporation can keep track of site use, while giving each separate site
control of its own processes and products.

Magic eMerchant v2 also has been improved to allow significant tailoring of
business rules, presentation and logic without any coding whatsoever.
Changes can be made on-the-fly and updated dynamically on the site with no
downtime required.

"Underlying Magic eMerchant's high degree of functionality and flexibility is
Magic's core technology, Magic eDeveloper(tm), which enables modifications to
be made to Magic eMerchant without extra coding.  This can result in
considerable time- and cost-savings for companies," said Menachem Hasfari,
chief executive officer of Magic.  "In addition, because the Magic technology
is platform- and database-independent, Magic eMerchant-based e-commerce sites
can be implemented quickly and integrated easily with existing legacy and
back-end systems.  Companies do not need to abandon their IT investments in
order to benefit from the increased revenue streams a site developed using
Magic eMerchant can deliver."

Currently, Magic eMerchant is being used by companies worldwide in a wide
variety of industries, including retail, manufacturing and distribution.  For
more information, visit the Magic website at
http://www.magicsoftware.com/emerchant.


About Magic Software Enterprises
Magic Software Enterprises, a member of the Formula Group (Nasdaq: FORTY),
develops, markets and supports software development and deployment technology
that enables enterprises to accelerate the process of building and deploying
applications that can be rapidly customized and integrated with existing
systems.  Magic technology, applications and professional services are
available through a global network of subsidiaries, distributors and Magic
solutions partners in approximately 50 countries.  The Company's North
American subsidiary is located at 1642 Kaiser Avenue, Irvine, Calif., 92614,
telephone (949) 250-1718, fax (949) 250-7404, http://www.magicsoftware.com.


The Formula Group is an international information technology company
principally engaged, through its subsidiaries and affiliates, in providing
software consulting services, developing proprietary software products and
producing computer-based solutions.

Except for the historical information contained herein, the matters discussed
in this news release include forward-looking statements that may involve a
number of risks and uncertainties.  Actual results may vary significantly
based upon a number of factors including, but not limited to, risks in
product and technology development, market acceptance of new products and
continuing product conditions, both here and abroad, release and sales of new
products by strategic resellers and customers, and other risk factors
detailed in the Company's most recent annual report and other filings with
the Securities and Exchange Commission.