Proposed Issue of Equity

RNS Number:2645O
Miller Fisher Group PLC
6 December 2001


For immediate release                                          6 December 2001

                           Miller Fisher Group plc

         Proposed issue of preference share capital and board changes

Miller Fisher Group plc ("Miller Fisher" or "the Company"), the provider of
outsourcing services to the insurance and financial services industries,
announces today a proposed issue of new preference capital and changes to the
Company's board of directors (the "Board").


Issue of Cumulative Redeemable Convertible Preference Shares


Miller Fisher and Bank of Scotland ("BOS") have agreed in principle, subject
to the satisfaction of certain conditions precedent, including the signing of
legally binding documentation, that BOS will subscribe for 13.25 million new
Cumulative Redeemable Convertible Preference shares ("CRCP shares") of 1p
each. The CRCP shares will be issued at a price of #1.00 each ("the Issue
Price").


The CRCP shares will be convertible until 2017 into 164 million new Miller
Fisher ordinary shares of 5p each, representing 49.9% of the enlarged issued
share capital, at the ratio of 12.3774 Miller Fisher shares for each CRCP
share held, equivalent to a conversion price of 8.08p.


The existing issued share capital of Miller Fisher comprises 164.4 million
ordinary shares of 5p each. Assuming full conversion of the CRCP shares, the
enlarged issued share capital of Miller Fisher would then comprise 328.4
million ordinary shares of 5p each.


Each CRCP share will pay a fixed dividend of 2p per annum. The CRCP shares
will not be listed, although application will be made to list any new Miller
Fisher shares issued on conversion.


In consideration for the issue of the CRCP shares, BOS will agree to
capitalise #13.25 million of existing bank indebtedness. As part of this
transaction, Miller Fisher will receive an additional new working capital
facility of #3.5 million to enable it to take advantage of opportunities in
the insurance outsourcing market.


Reasons for the issue and current trading


Miller Fisher announced its interim results on 10 September 2001. At that time
the Board stated that the Company had reduced bank borrowings by #5 million in
the first half of the year and believed that further reductions could be
achieved by positive cash flow and better management of working capital. The
Board also stated that the Company was trading against a difficult market
background. Trading conditions have continued to be difficult in the second
half of the year and it has not proved possible to reduce bank borrowings
further. The Board believes that the Company's debt level gives rise to
excessive balance sheet gearing which is and would continue to be an
impediment to the Company's development and prospects.


Following a review of strategic options, the Board believes that the proposed
issue of new preference capital is the best solution available to the Company
and will put the Company on an improved financial footing to enable it to
pursue its future development.


Board changes


Kevin Kenny has decided to stand down as Chief Executive and will retire as
Director of Miller Fisher at the end of December 2001. Malcolm Hughes,
currently Director of International Operations, will become Chief Executive.
Tom Anderson, currently Group Chief Operating Officer, has been appointed as a
Director of the Board. Sir Timothy Kitson, having attained the age of 70, will
retire as Chairman and from the Board at the end of March 2002.


Other Matters


The issue of CRCP shares will require the consent of shareholders at an EGM
and a circular containing further details, including details of proposed new
management incentive arrangements, and a notice convening the EGM will be
circulated to shareholders as soon as possible. As the conversion of the CRCPs
could give rise to an obligation for BOS to make an offer for Miller Fisher's
issued share capital under Rule 9 of the City Code on Takeovers and Mergers,
it is intended to apply to the Panel on Takeovers and Mergers for a waiver of
Rule 9 in respect of any such obligation, which, if the waiver is granted,
would be subject to shareholder approval.


Sir Timothy Kitson, Chairman, said today:


"We are delighted to have reached agreement in principle with the Bank of
Scotland on the issue of new preference capital. This brings to an end a
period of uncertainty for the company and provides us with a strong platform
for the future to maximise the opportunities available in our market."


For further information, contact:

Miller Fisher Group plc                                           020 7398 8700
Malcolm Hughes
Richard Horton

Grandfield                                                        020 7417 4170
Nick Boakes
Kirsty Black

The announcement has been issued by the Company and is the sole responsibility
of the Company. HSBC Investment Bank PLC has approved this document for
purposes of the Financial Services and Markets Act 2000 (in accordance with
transitional rules).


This announcement has been prepared for information purposes only and is not
to be relied upon in substitution for the exercise of independent judgement.
It is not intended as investment advice, and under no circumstances is it to
be used or considered as an offer to sell, or a solicitation of an offer to
purchase, any securities nor a recommendation to enter into any transaction;
nor shall it or any part of it form the basis of or be relied on in connection
with any contract or commitment whatsoever.


                                   - END -
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