CNIC.L Regulatory News (CNIC)

CentralNic Group Plc

("CentralNic" or the "Company")

Acquisition of the business and assets of Internet.BS

Background

CentralNic plc, (AIM:CNIC), the technical platform powering the sale of domain names through online retailers globally, is pleased to announce that it has contracted to acquire the business and certain of the assets of Internet.BS Corp ("Internet.BS"), a leading retailer of domain names registered in The Bahamas, for a maximum consideration of USD 7.5 million.

Internet.BS is one of the world's top thirty domain name retailers (or "registrars"), and it serves a global customer base from 199 countries. It has been trading for eleven years and it is accredited by the global regulator ICANN as well as the numerous operators of country codes including .eu for Europe and .in for India. Internet.BS is a profitable, cash generative business delivering unaudited operating profits and profits after tax of USD 730,000 for the year ending 31 December 2013. The acquisition is expected to be earnings enhancing from day one, excluding transaction costs.

Asset Purchase Agreement

CentralNic and Internet.BS have entered into an Asset Purchase Agreement to transfer the business and certain of the assets of Internet.BS to CentralNic. The assets are principally the customer base, registrar software and goodwill.

In conjunction with the Asset Purchase Agreement CentralNic have retained the services of Marco Rinaudo (Founder of Internet.BS) and Gregg McNair (Chairman of Internet.BS).

Consideration

The consideration payable on closing comprises USD 5.2 million of which USD 2.7 million is payable in cash and USD 2.5 million by the issue of 2,090,738 new ordinary shares of 0.1p in CentralNic. The consideration shares shall be held in escrow for a period of 12 months. Application has been made for the new ordinary shares in CentralNic to be admitted to trading and it is expected that admission will become effective and dealing commence on 20 June 2014. Following the transaction Internet.BS will be interested in 2,090,738 ordinary shares representing 3.42% of the issued share capital of CentralNic.

Deferred cash consideration of USD 1.8 million, payable in 12 months, can be adjusted (up and down) depending on the business performance. The maximum deferred consideration payable is USD 2.3 million.

Impact of the Acquisition

The acquisition of Internet.BS is a strategic step for CentralNic, which will position the Company as a vertically integrated platform offering domain names at retail as well as wholesale - one of the key objectives announced at admission to AIM in September 2013.

Key strategic drivers for the acquisition include:

- Gaining a proven retail platform already supporting 28,000 users in eight languages, including sophisticated administrative tools for domain portfolio owners;

- Enhancing the revenues and profits of CentralNic with an additional cash generative business retailing domains to consumers and other domain name retailers; and

- Optimizing the earnings opportunity for CentralNic presented by the new Top-Level Domains by giving it access to the retail margin for sales of these domains.

The Board believes that the deal terms are attractive, at under 10x EBITDA, with 35% of the consideration settled in shares.

Ben Crawford, Chief Executive Officer of CentralNic commented:

"We are delighted to be announcing the acquisition of Internet.BS today. As well as being a cash generative business with a large international client base, this acquisition provides us with the multilingual technical platform we need to offer domains for sale to the public in developing markets worldwide, where we have identified several opportunities in domain name retail. This deal allows us to accelerate the strategy we announced to the market when we listed, and which we have since progressed with the launch of other TRS retail websites such as buydomains.london, domain.luxury, domain.build and buy.menu."

CentralNic Registry update

CentralNic confirmed the launches exclusively over its technical platform of the new Top-Level Domains .wiki on 27 May 2014 and of .xyz on 2 June 2014. Both are obtaining promising registration numbers and are already among the top 50 new gTLDs at this stage (source: nTLdstats.com). The .ink gTLD launches into General Availability on 23 June 2014, with .bar and .rest following on 14 July 2014.

-Ends-

For further information:

About CentralNic Group plc

§ CentralNic (LSE: CNIC) is one of the world's leading providers of both registry and registrar services to the internet domain name industry, meaning that it is both a wholesaler and a retailer of the names used for website and email addresses. The business operates globally, with retail customers in over 75 countries and end users in 199 countries. It is headquartered in London, and in September 2013 successfully completed its admission to the AIM market of the London Stock Exchange. At the time of listing, CentralNic's goals were to grow the volume of transactions over CentralNic's platform, giving companies and individuals all over the world the tools to have their own online presence.

§ CentralNic distributes domains on behalf of their clients - owners or rights-holders - on a revenue share basis. CentralNic-distributed domains use an annual registration fee model, paid in advance by the end users, providing an annuity revenue stream for both CentralNic and its clients.

§ CentralNic was selected as the Registry Service Provider and distributor for 60 applications for new generic Top-Level Domains (gTLDs) - a programme devised by the domain industry regulator ICANN to supplement the existing TLDs such as .com and .co.uk with new domain extensions. Out of the 60 applications, there are 29 new gTLDs that will make exclusive use of CentralNic's platform, these include: .website, .wiki, .bar, .college, .press, .rest, .ink, .feedback, .contact and .xyz.

§ CentralNic will also distribute additional TLDs from a list of 26 applications that have passed initial evaluation and are currently in the process of contention resolution. These TLD's include .app, .art, .blog, .law, .llc, .mail, .news, and .school.

§ CentralNic's clients that are acquiring and funding these new TLDs include a number of successful entrepreneurs as well as Global 1000 companies such as Saudi Telecommunications, Qatar Telecom, Etisalat and Kuwait Finance House, and media and entertainment industry leaders The Guardian and William Morris Endeavor. CentralNic will receive shares in transactional revenues as fees for the distribution of domains using the new TLDs.

§ CentralNic's distribution network has approximately 1,500 registrars, including industry-leading domain retailers such as GoDaddy and Network Solutions. The network includes registrars in over 75 countries that retail domain names directly to the public and wholesale them through an additional network of over 100,000 resellers. End users register these domain names as an address for their websites and emails, as a defensive measure to protect their brands online, as a method of capturing internet traffic and achieving desired rankings on search engines, and as an investment.

§ CentralNic is itself the rights holder for 25 domain extensions, including .us.com, .eu.com, .uk.com, .ru.com and .cn.com. It therefore retains 100% of the wholesale revenues for domains using those domain extensions.

§ CentralNic is the owner of a portfolio of premium domain names including 17 two-letter .com domains including http://us.comand http://uk.com. Reports of sales of two-letter .com domains for of US$4.6 million and US$3.7 million in 2013 and 2014 (respectively) serve as evidence of the continued high values the market places on these premium domains.

§ Through the acquisition of Internet.BS, CentralNic has also become a significant retailer of domain names direct to end users.

All Group information and news can be found at http://www.centralnic.com