Placing & Acquisition

RNS Number:2246C
Electric Word PLC
28 April 2006



28th April 2006



                               ELECTRIC WORD PLC

                            Placing and Acquisition



Electric Word plc, the specialist information publisher, announced today the
acquisition of Incentive Plus Limited and Incentive Publishing Limited, for a
total cash consideration of #2.05 million. Both businesses are closely
affiliated to and supply the educational markets which Electric Word serves and
for which it holds large databases.



Incentive Plus (IP) is a leading educational mail order business providing
practical materials in the areas of social, emotional and behaviour skills in
children and young people - a market in which Electric Word holds an established
position, publishing extensive materials for teachers. Incentive Publishing
Limited is a smaller business with its own range of pupil motivational and
behavioural materials that are marketed and distributed by Incentive Plus. IP's
largest markets are in secondary and primary schools, but also include social
services departments and other professional groups working with children. The
combined businesses achieved adjusted audited pre-tax profits of #209k on a
turnover of #2,400k in the year ended 31 December 2005 (unadjusted audited
pre-tax profits were #306k, with directors' drawings of #97k. The audited net
assets of the combined businesses were #309k at 31 December 2005).



The consideration will be funded by a placing of 23,030,303 new ordinary shares
in the Company at 8.25p per share, to raise #1.9m before expenses, plus bank
debt. Application has been made for admission of the new ordinary shares to
trading on AIM and dealings in the new ordinary shares issued under the placing
are expected to commence on 5 May 2006. The combined acquisition is expected to
have no significant impact on earnings in the current financial year.



This latest acquisition by Electric Word follows the purchase of SportBusiness
Group for #2.74 million in January, which has shown particularly encouraging
progress within a larger specialist group.



Commenting on the acquisition, Julian Turner, Chief Executive of Electric Word
said:



"The IP customer base and product offering map neatly onto several of Electric
Word's 27 established education management subscription titles. We expect
therefore to utilise our educational databases to the benefit of both IP
businesses. We also have opportunities to apply Electric Word's e-marketing
expertise to accelerate the shift to online sales, which currently account for
just 11% of IP revenues, and to broaden the range of sectors that IP serves to
cover other areas of Electric Word strength."



Electric Word's trading this year continues to be in line with the Board's
expectations.



                                      ENDS

Enquiries
Julian Turner, Chief Executive
Dominic Jacquesson, Director
Electric Word                                                      0207 954 3470

Kim Muckle/Tim Spratt
Financial Dynamics                                                 0207 831 3113


Grant Harrison / Andrew Potts
Panmure Gordon & Co                                                0207 459 3600





APPENDIX: IMPORTANT INFORMATION ON THE PLACING

1. Definitions

Capitalised terms used in this announcement shall have the following meanings:

"AIM" means AIM, a market operated by the Exchange;

"Company" or "Electric Word" means Electric Word plc;

"CREST" means the relevant system (as defined in the Uncertificated Securities
Regulations 2001) in respect of which CRESTCo is the operator

"CRESTCo" means CRESTCo Limited

"Directors" means the directors of the Company;

"Exchange" means London Stock Exchange plc;

"Group" means the Company and its subsidiary undertakings from time to time;

"Ordinary Shares" means the ordinary shares of 1p each in the capital of the
Company;

"Panmure Gordon & Co" means Panmure Gordon (Broking) Limited (trading as Panmure
Gordon & Co) whose registered office is at Moorgate Hall, 155 Moorgate, London,
EC2M 6XB;

"Placees" means the persons to whom the Placing Shares are issued or sold
pursuant to the UK Placing, and Placee shall mean any one of them;

"Placing" means the placing of the Placing Shares at the Placing Price by
Panmure Gordon & Co on behalf of the Company pursuant to the Placing Agreement;

"Placing Agreement" means the placing agreement relating to the Placing dated 28
April  2006 between the Company, the Directors, and Panmure Gordon & Co;

"Placing Commitment" means the number of Placing Shares that each Placee has
agreed to subscribe for or purchase pursuant to the UK Placing;

"Placing Price" means 8.25p per Ordinary Share;

"Placing Shares" means 23,030,303 Ordinary Shares which are the subject of the
Placing;

"Securities Act" means the United States Securities Act of 1933, as amended; and

2. Terms and Conditions of the Placing applicable to Placees

Members of the public are not eligible to take part in the Placing. The
announcement and the terms and conditions set out herein are directed only at
either (i) persons whose ordinary activities involve them in acquiring, holding,
managing and disposing of investments (as principal or agent) for the purposes
of their business and who have professional experience in matters relating to
investments for the purposes of Article 19 of the Financial Services and Markets
Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"); (ii)
persons who are certified high net worth individuals for the purposes of Article
48 of the Order; (iii) high net worth companies, unincorporated associations etc
for the purposes of Article 49 of the Order; or (iv) persons who are
sophisticated investors for the purposes of Article 50 of the Order (in each
case "Relevant Persons"). The announcement and the terms and conditions set out
herein must not be acted on or relied on by persons who are not Relevant
Persons. Any investment or investment activity to which the terms and conditions
set out herein relates is available only to Relevant Persons and will be engaged
in only with Relevant Persons. Neither the announcement nor the terms and
conditions set out herein constitute a public offer for sale or subscription of
any securities in the Company.

Terms of the UK Placing

Application will be made to the Exchange for the Placing Shares to be admitted
to trading on AIM and it is expected that such trading will commence on 5th May
2006 ("Admission"). The Placing Shares will, upon issue, be credited as fully
paid and will rank in full for all dividends and other distributions declared,
made or paid on or after Admission and otherwise pari passu in all respects with
the existing Ordinary Shares.

The Placing and the Placees' participation in it will be conditional on the
Placing Agreement becoming unconditional in all respects and not having been
terminated in accordance with its terms. The Placing Agreement is conditional
upon, inter alia, Admission occurring by not later than 8.00 am on 5 May 2006
(or such later date as is agreed in writing between the Company and Panmure
Gordon & Co but not later than 31 May 2006).

Panmure Gordon & Co may in their absolute discretion agree to extend or waive
the time for the satisfaction of certain of the conditions of the Placing
Agreement (provided that such time may not be extended beyond 31 May 2006). In
the event that any such extension is agreed, Panmure Gordon & Co will inform the
Placees at the earliest opportunity and all subsequent dates mentioned in this
announcement will be adjusted appropriately.

By agreeing to participate in the Placing via a telephone conversation, Placees
accept the terms and conditions set out herein which will constitute a binding
irrevocable commitment by a Placee, subject to the conditions set out below, to
subscribe or purchase and pay for the relevant number of Placing Shares, which
is not capable of termination or rescission by the Placee in any circumstances
except fraud. All such obligations are entered into by the Placee with Panmure
Gordon & Co in its capacity as agent for the Company and are therefore directly
enforceable by the Company.

Termination

Panmure Gordon & Co have the right to terminate the Placing Agreement (in their
absolute discretion) if prior to Admission, inter alia: (i) any statement
contained in any press announcement has, in the reasonable opinion of Panmure
Gordon & Co, been discovered to be untrue, incorrect or misleading; or (ii)
there has, in the reasonable opinion of Panmure Gordon & Co, been a breach of
any of the warranties contained in the Placing Agreement or any other
obligations on the part of the Company or the Directors under the Placing
Agreement which Panmure Gordon & Co reasonably considers to be material in the
context of the Placing.

By participating in the Placing and so accepting the obligations set out in the
terms and conditions herein the Placee agrees that any exercise by Panmure
Gordon & Co of any right to terminate the Placing Agreement or to waive or
extend any condition in the Placing Agreement shall be within Panmure Gordon &
Co's absolute discretion and that Panmure Gordon & Co shall not have any
liability to the Placee whatsoever in connection with any decision to exercise
or not to exercise any such right. If the Placing Agreement does not become
unconditional or is terminated in accordance with its terms prior to Admission,
the Placing will not proceed and the Placee's rights and obligations will cease
and no claims will be capable of being made by the Placee in respect of the
Placing and any payments made by the Placee will be returned as soon as possible
thereafter without interest.

Settlement

Settlement of transactions in the Placing Shares following Admission will take
place within the CREST system against Panmure Gordon & Co's CREST account number
83801.

Placees will receive a conditional contract note from Panmure Gordon & Co which
will be deemed to incorporate the terms and conditions contained in this
Appendix.

Overseas shareholders

No steps have been taken to enable any of the Placing Shares to be acquired by
Placees outside the United Kingdom. By participating in the Placing and so
accepting any offer incorporating the terms and conditions herein, the Placee
represents and warrants that it is entitled to acquire the Placing Shares under
the laws and regulatory requirements of all relevant jurisdictions which apply
to it, and that it has fully observed such laws and requirements and obtained
all governmental and other consents which may be required thereunder and
complied with all necessary formalities and (save as set out below) will pay any
issue or other taxes due thereunder and that it has not taken any action which
will or may result in the Company or Panmure Gordon & Co acting in breach of any
regulatory or legal requirements of any territory in connection with the Placing
or the Placee's acceptance of the terms and conditions herein.

The Placing Shares have not been and will not be registered under the Securities
Act under the securities law of any state of the United States nor have they
been qualified for sale under the securities legislation of any province or
territory of Canada and the relevant exemptions are not being obtained from the
securities commission of any province of Canada and accordingly, the Placing
Shares may not be offered, sold, taken up, delivered or transferred (directly or
indirectly) and will not qualify for sale within the United States or Canada or
to, or for the account or benefit of, any person or corporation in (or with a
registered address in) the United States or Canada.

The Placing Shares will not be lodged or registered with the Australian
Securities and Investments Commission under Australia's Corporations Law and are
not being offered for subscription or sale and may not be directly or indirectly
offered, sold or delivered in or into Australia or for the account or benefit of
any person or corporation in (or with a registered address in) Australia.

No document in relation to the Placing Shares has been or will be lodged for
registration with the Registrar of Companies in the Republic of Ireland and the
Placing Shares will not be offered, sold or delivered, directly or indirectly in
the Republic of Ireland. All subscribers for, or purchasers of, Placing Shares
must provide addresses outside the Republic of Ireland for the receipt of
certificates for Placing Shares.

The relevant clearances have not been, and will not be, obtained from the
Ministry of Finance of Japan and no document in relation to the Placing has been
or will be lodged with or registered by the Ministry of Finance of Japan. The
Placing Shares may not therefore be offered or sold, directly or indirectly, in
or into Japan, its territories and possessions and any areas subject to its
jurisdiction.

Tax

The Placing Shares will be acquired by the Placee free of all expenses and free
of all stamp duty and stamp duty reserve tax ("SDRT") unless stamp duty or SDRT
is chargeable on the issue of Placing Shares to the Placee under any of sections
67 and 93 (Depository Receipts) or sections 70 or 96 (Clearance Services) of the
Finance Act 1986. In summary, these sections will apply if the Placee's business
is or includes issuing depository receipts or the provision of clearance
services or acting as agent or nominee for a person whose business is or
includes issuing depository receipts or the provision of clearance services. By
accepting the terms and conditions herein the Placee confirms and warrants to
Panmure Gordon & Co (for itself and as an agent for the Company) that these
sections will not apply to the placing of Placing Shares by it. If the Placee is
not able to confirm or warrant that the above sections apply or if any such
stamp duty or SDRT is payable, it will be entirely for the Placee's account and
neither the Company nor Panmure Gordon & Co will have any liability in respect
thereof.

General

This announcement is the sole responsibility of the Company. Panmure Gordon & Co
is acting as nominated adviser and broker to the Company in relation to the
Placing.  Panmure Gordon & Co will not be responsible to any person other than
the Company for providing the protections afforded to the customers of Panmure
Gordon & Co (under the rules of the Financial Services Authority) nor for
advising any person other than the Company on the transactions and arrangements
referred to in any press announcement.

By participating in the Placing, each Placee irrevocably represents, warrants
and undertakes to Panmure Gordon & Co (for itself and as agent of the Company)
that:

a) it and/or each person on whose behalf it is participating (in whole or in
part) in the Placing or to whom it allocates its Placing Shares in whole or in
part:

(i) has the capacity and authority and is entitled to enter into and perform its
obligations as a subscriber or purchaser of Placing Shares and will honour such
obligations, and

(ii) has fully observed all laws of relevant jurisdictions and obtained all
necessary governmental or other consents in either case which may be required in
relation to the subscription or purchase by it of Placing Shares;

b) it is not a person who is resident in, or a citizen of, the United States,
Canada, Australia, the Republic of Ireland or Japan (or an agent or nominee of
such a person) or a corporation, partnership or other entity organised under the
laws of any such jurisdiction (or an agent or nominee of such a person);

c) it is a Relevant Person;

d) in accepting its Placing Commitment it is acting as principal and for no
other person and that its acceptance of that participation will not give any
other person a contractual right to require the issue, or the transfer, of any
of the Placing Shares;

e) it irrevocably confirms Panmure Gordon & Co's discretion with regard to the
Placing Agreement and agrees that Panmure Gordon & Co does not owe it any duties
in respect of any claim it may have relating to the Placing;

f) it acknowledges and agrees that the Placing Shares have not been and will not
be registered under the Securities Act or under the securities laws of any State
of the United States, that the relevant clearances have not been and will not be
obtained from the Securities Commission of any province of Canada and that the
Placing Shares have not been and will not be registered under the securities
laws of Australia, the Republic of Ireland or Japan and, therefore, the Placing
Shares may not be, subject to certain exceptions, directly or indirectly,
offered or sold in the United States, Canada, Australia, the Republic of Ireland
or Japan;

g) it acknowledges and agrees that neither it nor any affiliate, nor any person
acting on its or any affiliate's behalf, has or will offer, sell, take up,
renounce, transfer or deliver directly or indirectly any Placing Shares within
the United States, Canada, Australia, the Republic of Ireland or Japan or offer,
sell, take up, renounce, transfer or deliver in favour of a resident of Canada,
Australia, the Republic of Ireland or Japan;

h) it has not offered or sold and will not offer or sell any Placing Shares in
the United Kingdom except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (either as principal or
agent) for the purposes of their business or otherwise in circumstances which
have not resulted and will not result in offers to the public in the United
Kingdom within the meaning of the Financial Services and Markets Act 2000;

i) it acknowledges that it has complied with all relevant laws of all
territories, or obtained all requisite governmental or other consents which may
be required in connection with its participation in the Placing; that it has
complied with all requisite formalities and that it has not taken any action or
omitted to take any action which will or may result in Panmure Gordon & Co or
the Company or any of their directors, officers, agents, employees or advisors
acting in breach of the legal and regulatory requirements of any territory in
connection with the UK Placing or its application and that it is not in a
territory in which it is unlawful to make an offer to subscribe for, or
purchase, Placing Shares, or to accept such an offer;

j) it acknowledges and agrees in connection with its participation in the
Placing that Panmure Gordon & Co is not acting for it in relation to the Placing
or otherwise and that Panmure Gordon & Co will not have any duties or
responsibilities to it for providing the protections afforded to its customers
or for advising it with regard to the UK Placing or the Placing Shares;

k) it irrevocably appoints any director of Panmure Gordon & Co as its agent for
the purpose of executing and delivering to the Company and/or its registrars any
documents on its behalf necessary to enable it to be registered as the holder
of, or to purchase, any of the Placing Shares;

l) it confirms that it has obtained all necessary consents and authorities to
enable it to give its commitment to subscribe for or purchase Placing Shares and
to perform its obligations as set out herein;

m) it is not a person falling within subsections (6), (7) or (8) of section 67
or subsections (2) and (3) of section 93 of the Finance Act 1986 (i.e. an issuer
of depositary receipts) or subsections (6), (7) or (8) of section 70 or
subsection (1) of section 96 of the Finance Act 1986 (i.e. a provider of
clearance services) or an agent or nominee of either such person;

n) the issue or transfer of Placing Shares to it (whether as principal, agent or
nominee) will not be subject to stamp duty or SDRT at the increased rates
referred to in sections 67 or 93 (Depositary Receipts) or sections 70 or 96
(Clearance Services) of the Finance Act 1986; and

o) the Placing Shares will be issued or transferred subject to the terms and
conditions set out herein.

A Placee will participate in the Placing by taking a Placing Commitment.

These terms and conditions and all documents and agreements into which these
terms and conditions are incorporated by reference or otherwise will be governed
by and construed in accordance with English law.

- Ends -






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