Brady Regulatory News (BRY)

For immediate release 29 November 2010

Brady plc

("Brady" or "the Company")

Acquisition of Viz Risk Management Services AS

Conditional Placing of 25,423,729 ordinary shares to raise £15 million (before expenses)

The Board of Brady today announces that it has conditionally agreed to acquire Viz Risk Management Services AS ("Viz"), a privately-owned company based in Bergen, Norway which is a leading provider of trading and risk management systems for the energy markets, primarily electricity, gas, coal and emission certificates, for an aggregate consideration of Kr 92,500,000 (approximately £9.6 million) (the "Acquisition") in cash. The Company intends to raise £15 million (before expenses) by way of a conditional placing by Cenkos Securities plc (the "Placing") of 25,423,729 new ordinary shares (the "Placing Shares") with various institutional and other investors at a price of 59 pence per share (the "Placing Price") to fund the consideration payable for the Acquisition. The balance of the net proceeds of the Placing will be used for additional working capital for the Brady Group (as enlarged following the Acquisition).

The Placing is conditional, inter alia, upon resolutions being passed at the General Meeting of the Company to be held on 21 December 2010 to give the Directors of the Company the necessary share capital authorities to effect the Placing. The Placing comprises a placing of 6,101,695 new ordinary shares which will qualify as VCT investments (the "VCT Placing") and a placing of a further 19,322,034 new ordinary shares (the "Non- VCT Placing"). The Placing Shares proposed to be issued pursuant to the VCT Placing (the "VCT Placing Shares") are expected to be admitted to trading on AIM on 22 December 2010 and the Placing Shares proposed to be issued pursuant to the Non- VCT Placing (the "Non-VCT Placing Shares") are expected to be admitted to trading on AIM on 23 December 2010.

Background to and reasons for the Placing

The Directors believe that the Acquisition will complement Brady's existing business and is in line with the Company's stated strategy of enhancing anticipated organic growth with the acquisition of suitable companies to strengthen the Company's product and customer base. Viz and its subsidiaries (the "Viz Group") operate in Northern and mainland Europe and have a particularly strong presence in Northern Europe in the large and expanding energy markets for electricity, gas, emission certificates and coal. The Directors believe that these markets are highly complementary to Brady's existing commodity markets and offer significant cross-selling opportunities to the enlarged customer base. The Directors anticipate enhancing the Viz business with a stronger commercial and sales focus, as has been successfully demonstrated following the recent two acquisitions, of Commodities Software (UK) Limited in January 2009 and Viveo Switzerland SA in March 2010. The Viz Group operates under a revenue rental model and as such the Directors anticipate that the acquisition of Viz will significantly increase Brady's overall recurring revenues, improve the Company's quality of earnings and reduce the inherent risk attached to securing large licence deals. The Viz Group has recently reduced its cost base and also transferred a number of selected product development activities to St Petersburg, Russia, at significantly lower cost, and it is anticipated that Brady will benefit from this reduced cost base going forward. The presence in St Petersburg also opens up the potential for new business in the Russian natural resource market.

The Directors believe that there is a strong opportunity to become a leading consolidator of commodity software companies and that the acquisition of Viz will be a key step in increasing Brady's critical mass and scale. The Directors believe that the Acquisition is strategically compelling for the following reasons:

·; Increase Brady's recurring revenue and quality of earnings - the Directors believe that the Acquisition will generate a substantial increase in Brady's recurring revenues, thereby enhancing quality of earnings and reducing overall risk from the reliance on the sale of licence transactions, the timing of which is always difficult to predict. The Viz Group operates under a recurring revenue model with more than 80 per cent. of its anticipated annual revenues going forward being forecasted as recurring in nature. This, combined with Brady's traditional licence model is anticipated to increase the enlarged Brady's recurring revenues to more than 50 per cent. of its annual revenues going forward;

·; Access to complementary energy asset classes - the Acquisition will result in the addition of new and complementary asset classes to Brady's products including energy, gas, carbon emissions and coal, markets which external consultants forecast to grow at 15-21% per annum;

·; Creation of cross-selling opportunities - in addition to the separate companies' inherent growth prospects on a stand-alone basis, the additional assets classes offer a strong opportunity to cross-sell. In particular, energy is a significant input for many of Brady's existing commodity clients. The Directors estimate that approximately one third of Brady's existing clients trade energy contracts;

·; Strengthened presence in Northern Europe - the Directors believe that the acquisition of Viz will strengthen Brady's brand and commercial presence in Northern Europe, complementing the Group's already strong commercial presence in the UK and mainland Europe and its increasing presence in the Americas and Asia;

·; Benefit from lower cost base - the Viz Group has undertaken a reorganisation and also transferred a number of selected product development activities to the lower cost location of St Petersburg, Russia. It is anticipated that Brady will benefit from the lower cost base going forward.

Current trading and prospects

On 6 September 2010, Brady announced its unaudited interim results for the six months to 30 June 2010 with consolidated revenue of £4.63 million (six months to 30 June 2009: £3.69 million), gross profit of £2.46 million (six months to 30 June 2009: £2.06 million), result for the period before exceptional items of £0.36 million (six months to 30 June 2009: £0.27 million) and result for the period after exceptional item of minus £0.12 million (six months to 30 June 2009: £0.31 million). Basic earnings per share continued to grow to 1.14 pence per share before exceptional item and minus 0.59 pence per share after exceptional item (six months to 30 June 2009: 0.70 pence per share). Net assets at 30 June 2010 were £7.43 million, and net cash as at 30 June 2010 was £3.29 million.

On 18 October 2010, the Company announced a new contract win with BTI Bulk Trading International and on 18 November 2010, the Company announced a further new contract win with a leading bank in the Netherlands.

The Directors are pleased with progress in the year and in particular with the recent acquisition of Brady Switzerland SA and remain confident about the year ahead.

The Placing

The Company proposes to raise approximately £13.85 million (net of expenses) through the issue of the 25,423,729 Placing Shares at the Placing Price. The 25,423,729 Placing Shares would represent approximately 47.1 per cent. of the Company's issued ordinary share capital immediately following admission of both the VCT Placing Shares and the Non-VCT Placing Shares to trading on AIM ("Admission").

Certain of the Directors will be participating in the Placing. Paul Fullagar, Chairman, has committed to subscribe for 203,390 Placing Shares, Gavin Lavelle, Chief Executive, has committed to subscribe for 84,746 Placing Shares and Tony Ratcliffe, Finance Director, has committed to subscribe for 20,339 Placing Shares.

A circular containing full details of the Placing and notice of the General Meeting of the Company convened to be held on 21 December 2010 (to give the Directors of the Company the necessary share capital authorities to effect the Placing) is being posted to shareholders of the Company today and will be available on the Company's website: www.bradyplc.com.

The Placing Agreement

Cenkos Securities plc ("Cenkos") has entered into a Placing Agreement with the Company whereby it has agreed to use its reasonable endeavours, as agent for the Company, to procure placees for all the Placing Shares.

The Placing Agreement contains warranties from the Company in favour of Cenkos in relation to, inter alia, the accuracy of the information in the Circular and other matters relating to the Company and its business. In addition, the Company has agreed to indemnify Cenkos in relation to certain liabilities it may incur in respect of the Placing. Cenkos has the right to terminate the Placing Agreement in certain circumstances, in particular, in the event of a material breach of the warranties.

Admission to trading on AIM

Application will be made to the London Stock Exchange for the aggregate 25,423,729 Placing Shares to be admitted to trading on AIM. It is expected that trading in the VCT Placing Shares on AIM will commence on 22 December 2010 and that trading in the Non-VCT Placing Shares on AIM will commence on 23 December 2010.

The Placing Shares will, when issued, rank pari passu in all respects with the existing issued Ordinary Shares including the right to receive dividends and other distributions declared following the date of relevant Admission.

Recommendation

The Directors consider the Acquisition and the Placing set out in the circular, to be posted to shareholders today, to be in the best interests of the Company and its Shareholders as a whole. Accordingly, the Directors recommend Shareholders to vote in favour of the resolutions to be proposed at the General Meeting, as they have irrevocably undertaken to do in respect of their own shareholdings and those of their related parties of 10,075,410 existing Ordinary Shares, representing approximately 35.58 per cent. of the voting rights exercisable in respect of the current issued ordinary share capital of the Company.

Commenting on the Acquisition and the Placing/today's news, Chief Executive, Gavin Lavelle, said;

"It is Brady's aim to be the definitive global partner of choice for trading, risk management and settlement solutions across all commodities and energy markets. The acquisition of Viz will greatly strengthen our offering in the energy markets in the same way that our recent acquisition of Viveo enabled us to broaden our solutions for softs and agriculturals, in addition to our established expertise in base, raw materials and precious metals. This will be of enormous benefit to both Viz and Brady clients. For Brady, energy is an important input price into the industrial companies producing or fabricating commodities. We have a successful track record of fast and efficient integration of acquired companies and we are confident clients will quickly see tangible, long-term benefits from our latest acquisition."

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