Acquisition

RNS Number:7130D
Electric Word PLC
12 September 2007


 

 

12 September 2007

                               ELECTRIC WORD PLC    
                        ("Electric Word" or "the group")                        

 

              ELECTRIC WORD ADDS MAGAZINES TO EDUCATION PUBLISHING              


Electric Word plc, the specialist information business, today announces that the
group has entered into an agreement with Special Education Publishing Ltd
("SEP") to manage three educational magazines published by SEP aimed at teachers
in primary schools, Special Children, Teaching and Learning and PE and Sports
Today. The magazines are the only assets of SEP. The management agreement, which
commenced on 11 September, allows for an ongoing performance-related fee to
Electric Word of a minimum of #30,000 per quarter plus an initial integration
fee.


Electric Word has also been granted an option to acquire the entire issued share
capital of SEP, by Sussex Research Ltd, the sole shareholder of SEP and also a
significant shareholder in Electric Word plc. The option is exercisable at any
time between 1 December 2007 and 11 September 2010 for a total consideration of
#875,000 to be satisfied by the allotment of 875,000 Convertible Preference
Shares, which will convert into ordinary shares of Electric Word plc ("Ordinary
Shares") at a price of 13.25 pence per share unless redeemed in cash at the
election of Electric Word for a 0% coupon at any time prior to the third
anniversary of the date of exercise of the Option . If converted in full,
Electric Word would be required to allot 6,603,773 Ordinary Shares. A resolution
to create the Convertible Preference Shares will be put to shareholders either
at next year's AGM or at an extraordinary general meeting convened prior to
then.

 
The exercise of the option to acquire SEP will be treated as a related party
transaction under rule 13 of the AIM Rules.

Julian Turner, Chief Executive of Electric Word, commented: "These established
magazines fit well with our existing portfolio in the niche education market. We
are pleased to be taking them under the group's management and have every
confidence in their future success."

 
The Group continues to trade ahead of last year and in line with the Board's
expectations.


Julian Turner, Chief Executive                                           
Electric Word                        0207 954 3470                       
                                                                         
Helen Thomas / Tim Spratt                                                
Financial Dynamics                   0207 831 3113                       

 



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