Ceps Regulatory News (CEPS)

2 April 2012

CEPS PLC

 ("CEPS" or the "Company")

Acquisition & Placing

Acquisition

The Board of CEPS announces that the Company is conditionally proposing to acquire a 21.4 per cent. shareholding in NG42 Acquisitions Limited ("NG42") for an aggregate cash consideration of £500,000 (the "NG42 Acquisition"). The NG42 Acquisition is subject only to completion of the proposed placing by CEPS, details of which are set out below.

NG42 is a newly incorporated company formed to acquire the entire issued share capital of CEM Group Limited ("CEM"). The acquisition of CEM by NG42 (the "CEM Acquisition") was completed on 31 March 2012.

CEM owns 100% of CEM Press Limited ("CEMP"), a manufacturer of fabric and wallpaper pattern books with a focus on the high-end fabric and wallpaper market. CEMP's products are sold both in the UK and overseas. In the year ended 31 December 2010, CEMP's sales were £2,867,000 and profit before tax was £359,000. At 31 December 2010, net assets were £423,000. Trading performance of CEMP in 2011 was in line with management's expectations for the year.

The consideration for the CEM Acquisition is £2,377,200, comprising a mix of cash, loan notes and consideration shares. Other third party investors have invested an aggregate of £1,400,000 in cash in NG42, at the same price per NG42 share as is being paid by CEPS, for approximately 59.8% of the issued share capital of NG42.

The NG42 Acquisition fits well with CEPS' strategy of acquiring interests in established, cash generative businesses and utilises a funding structure aimed at maximising the return on equity employed.

The Directors of CEPS believe that the NG42 Acquisition will be a valuable addition to the Company's portfolio of investments.

Placing

In order to finance the NG42 Acquisition, the Company is proposing to issue 2,500,000 new ordinary shares of 5 pence per share (the "Placing Shares") at a price of 20 pence per share (the "Placing Price") to new and existing investors, including certain CEPS Directors, raising gross proceeds of £500,000 (the "Placing"). The Placing is subject to admission of the Placing Shares to trading on AIM ("Admission").

The Placing Price is equal to the closing mid-market price of 20 pence per CEPS share as at 30 March 2012, being the last business day prior to this announcement.

Application for Admission for the Placing Shares has been made and Admission is expected to occur on or around 3 April 2012. Once issued, the Placing Shares will rank pari passu with the existing ordinary shares in the Company.

Following the issue of the Placing Shares, the issued share capital of the Company will comprise 10,814,310 ordinary shares of 5 pence each.

Related Party Transactions

David Horner and Richard Organ, who are directors of the Company, Mark Thistlethwayte and Chelverton Growth Trust, who are substantial shareholders in the Company, and Chelverton Asset Management, of which David Horner is a director, have agreed to subscribe for Placing Shares at the Placing Price. These subscriptions are Related Party Transactions as defined in the AIM Rules for Companies. Details of their respective subscriptions and resultant shareholdings are set out in the table below.

Peter Cook, Geoff Martin and Vivien Langford, being the independent directors of the Company, consider, having consulted with Cairn Financial Advisers LLP, the Company's nominated adviser, that the terms of the transactions are fair and reasonable insofar as the Company's shareholders are concerned.

Trading update

As indicated in the half yearly report in September 2011, the trading environment in the second half has continued to be difficult. Consequently, the Directors do not anticipate that the second half results will show any significant change to the first half.

The Directors anticipate that the preliminary results of the Company for the year ended 31 December 2011 will be published on or around 6 June 2012.

Enquiries