CLP.L Regulatory News (CLP)

31 March 2010

Brainspark plc

("Brainspark or the "Company")

Increase of stake in Mediapolis Investments S.A. and Mediapolis S.p.A.

Key facts:

·; Brainspark has acquired a further 1.31% equity interest in Mediapolis S.p.A., taking its total direct equity interest to 1.79% of Mediapolis S.p.A.;

·; Brainspark has acquired a further 3.33% equity interest in Mediapolis Investments S.A., taking its total equity interest to 14.13% of Mediapolis Investments S.A.;

·; Brainspark has entered into an agreement to acquire a further 7.42% equity interest in Mediapolis Investments S.A.; and

·; Mediapolis Investments S.A. has a 69.94% equity interest in Mediapolis S.p.A.

The Board of Brainspark (AIM: BSP), the fast growing international investment company, is pleased to announce that it has increased its equity interest in Mediapolis Investments S.A. ("Mediapolis Investments") and Mediapolis S.p.A. ("Mediapolis") which is the owner of a site in northern Italy with plans for the development of a theme park, through the acquisition of shares in both companies from certain vendors (together, the "Acquisition") as follows:

The Company has acquired a 1.31% equity interest in Mediapolis and a 2.16% equity interest in Mediapolis Investments from Alfredo Villa, Chief Executive of Brainspark. The total consideration payable by Brainspark is being satisfied through the issue of 459,386,200 new ordinary shares of 0.01 pence in Brainspark to Alfredo Villa (the "Villa Shares"). Alfredo Villa has agreed to donate 26,943,400 of the Villa Shares to Homes for Hope, a charity for which he is a founder and a director. Following completion of the Acquisition, Alfredo Villa will have an interest in 692,492,239 ordinary shares in Brainspark representing 30.51%* of the enlarged issued share capital of Brainspark. Homes for Hope will have an interest in 81,943,400 ordinary shares in Brainspark representing 3.61% of the enlarged issued share capital of Brainspark. Alfredo Villa is also a director in Mediapolis Investments.

The Company has also acquired a further 1.17% equity interest in Mediapolis Investments from Fabio Bernini. The total consideration payable by Brainspark is being satisfied through the issue of 80,000,000 new ordinary shares of 0.01 pence in Brainspark to Fabio Bernini (the "Bernini Shares"). Following completion of the Acquisition Fabio Bernini will have an interest in 80,000,000 ordinary shares in Brainspark representing 3.52% of the enlarged issued share capital of Brainspark.

Following completion of the Acquisition Brainspark will have an 1.79% equity interest in Mediapolis and a 14.13% equity interest in Mediapolis Investments. Mediapolis Investments controls Mediapolis through its 69% interest. Further information on Mediapolis and the development is given below.

The Company has also entered into an agreement to acquire a further 7.42% equity interest in Mediapolis Investments from Claudio Gianascio. The total consideration payable by Brainspark to Claudio Gianascio is EUR 952,000 (GBP 875,000) in cash and is expected to be payable by Brainspark by 1 July 2010. The funds will be satisfied through Brainspark raising additional funds. 

Mediapolis, (www.gruppomediapolis.com) is an Italian real estate company with planning permission to develop an indoor (25,000 sq metres) and outdoor (148,000 sq metres) theme park with outdoor theatre (15,000 seats), shopping centre (36,000 sq metres), a 4-star hotel (342 rooms) and a television production centre. The total area for the whole development is 60 hectares (148.2 acres). The site is located on the Milan-Turin-Aosta highway junction, 60 minutes drive from Milan, 50 minutes from Turin and 60 minutes from the Mont Blanc Tunnel, one of the main arteries between France and Northern Italy. Telecom Italia SpA, through Olivetti Multiservices, holds 8.58 per cent of the issued share capital of Mediapolis. 

The overall development costs of the site are estimated by the management of Mediapolis at EUR 220,000,000 (GBP 201,653,000) over a period of three years, with the theme park element expected to be operational in under two years. The project financing for the overall development is managed by Unipol Gruppo Finanziario (http://www.unipolgf.it/int/en). 

For the year ended 31 December 2008, Mediapolis Investments generated a loss before tax of €0.49m and had net assets of €5.8m. An independent valuation carried out by a high profile international independent valuation organization on 22 January 2010 valued Mediapolis at EUR 52.0 million (GBP 46.2 million).

As Alfredo Villa is a major shareholder and director of Brainspark, the issue of the Villa Shares constitutes a related party transaction under rule 13 of the AIM Rules for Companies. The directors of Brainspark (with the exclusion of Alfredo Villa), having consulted with Allenby Capital Limited, the Company's nominated adviser, consider that the terms of the issue of the Villa Shares are fair and reasonable insofar as the Company's shareholders are concerned.

Application has been made to the London Stock Exchange for the admission of the Bernini Shares and the Villa Shares to trading on AIM ("Admission") and it is expected that Admission of the 539,386,200 new ordinary shares of 0.01 pence in Brainspark being issued pursuant to the Acquisition will take place on or around 1 April 2010. On Admission there will be 2,269,672,667 ordinary shares of 0.01 pence each in Brainspark in issue (including the 198,000,000 new ordinary shares in Brainspark which are expected to be admitted to trading to AIM on 1 April 2010 pursuant to the investment by Brainspark in Bibop S.p.A. as announced by Brainspark on 26 March 2010). The Bernini Shares and the Villa Shares will represent, in aggregate, 23.76 per cent. of the enlarged issued share capital of Brainspark on Admission.

Prof. Francesco Gardin, Chairman of Brainspark, commented: "We are very pleased to be in a position to increase our stake in the Company's core strategic Mediapolis project, where we now hold a significant minority position at a more than 30% discount on the most recent valuation of Mediapolis by a large independent international valuation company."

* This comprises the beneficial interest of Alfredo Villa in 534,342,239 ordinary shares in the Company and the non-beneficial interest in 158,150,000 ordinary shares in the Company held by RCF SA and their clients. RCF SA is a portfolio management company of which Mr Villa is Managing Director and a discretionary fund manager.

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