CLP.L Regulatory News (CLP)

8 Nov 2006 11:18

Brainspark PLC08 November 2006 FOR IMMEDIATE RELEASE 8 November 2006 BRAINSPARK PLC Sale of Shares in ACS On 8 August 2005, Brainspark granted a call option to Exprivia SpA over theentire issued share capital of Brainspark's wholly owned subsidiary, Infusion2002 Limited ("Infusion"), which in turn held a 16.21 per cent. investment inAdvanced Computer Systems SpA ("ACS"), an Italian Company developing softwarefor earth observation satellites, mission planning and management. This optionexpired on 31 July 2006. Following the expiry of the option, the Company has been in discussions withExprivia, as a result of which Infusion has now sold 197,233 shares in ACS toExprivia, representing a 7.68 per cent. interest for a consideration of$1,000,000 (approximately £526,000). The consideration has been satisfied bytransferring a secured commercial debt in Geosim Limited, a company incorporatedin Israel, owing to an Exprivia subsidiary. Brainspark currently holdsapproximately 50.8% (41.03% fully diluted) of Geosim's equity capital. 89 percent. of the $ 1,000,000 debt has been guaranteed by Prof. Francesco Gardin,Chairman of Brainspark and non-executive Chairman of Exprivia and this securityremains in place on the transfer of the Geosim debt to Brainspark. The book value of the ACS shares sold is £535,000 (after taking into account thereduction of book- cost of the entire holding as a result of the £325,000non-refundable deposits previously received from Exprivia). The Geosim debtamounts to US$1,000,000, is repayable in quarterly amounts equivalent to 5 percent. of Geosim's revenues between 1 January 2006 and 31 December 2009 andcarries no interest. As and when received, repayments will provide Brainsparkwith further funds to invest and/or additional working capital for the Group. Brainspark has been considering a realisation of its investment in ACS for sometime and the sale of half of Brainspark's interest in ACS to Exprivia is anopportunity to start this process. The Geosim debt helps to consolidateBrainspark's interest in Geosim which Brainspark views as a major strategicinvestment for the Group. For the year ended 31 December 2005, ACS reported a profit after tax of euro32,032 on turnover of euro 10,559,000. For the year ended 31 December 2005,Geosim reported a loss of NIS 4,096,000 on turnover of NIS 1,665,000. Prof. Francesco Gardin is both Chairman of Brainspark and non-executive Chairmanof Exprivia and a 20.53 per cent. and 3.2 per cent. shareholder respectively ineach company. Prof. Francesco Gardin is also a director of Geosim. Accordingly,the transaction is Related Party under the AIM Rules. The Directors ofBrainspark, with the exception of Prof. Gardin consider, having consulted theCompany's Nominated Adviser, that the terms of the above transaction are fairand reasonable in so far as the Company's shareholders are concerned. For information please contact: Francesco Gardin, Brainspark plc, telephone: 00 39 335 296573 Roland Cornish, Beaumont Cornish Limited, telephone: 020 7628 3396 This information is provided by RNS The company news service from the London Stock Exchange