Coral Products Regulatory News (CRU)

22 February 2016

CORAL PRODUCTS PLC

("Coral" or the "Company")

ACQUISITION AND PLACING

Acquisition of the entire issued share capital of Global One-Pak Holdings Limited

Placing of 13,750,000 new ordinary shares at 20 pence per share raising £2.75 million

Coral Products plc, a specialist in the design, manufacture and supply of injection moulded plastic products based in Haydock, Merseyside, is pleased to announce that it has conditionally acquired the entire issued share capital of Global One-Pak Holdings Limited ("GOP") for a minimum consideration of £3.60 million ("Acquisition"), comprising £2.95 million to be satisfied in cash and £0.65 million to be satisfied by the issue of 3,250,000 new ordinary shares to the vendors of GOP ("Vendors") at a price of 20 pence per share ("Consideration Shares").

The cash consideration for the Acquisition is being satisfied from:

(i) £0.40 million of free cash available at GOP, such funds becoming payable to the Vendors pursuant to the terms of the share purchase agreement between the Vendors and the Company ("SPA") as to £0.30 million upon completion of the Acquisition and £0.10 million on the date falling 90 calendar days after the date of completion of the Acquisition; and

(ii) £2.55 million of the proceeds of a placing of 13,750,000 new ordinary shares in the Company at a price of 20 pence per share ("Placing Shares") with new and existing investors (the "Placing") to raise £2.75 million for Coral before expenses of approximately £0.20 million. The Placing was conducted through Daniel Stewart & Company Limited, the Company's broker, and was oversubscribed.

In addition to the consideration of £3.60 million detailed above, an earn-out consideration shall become payable to the Vendors in the event that GOP's EBITDA for the year ended 31 December 2016 ("2016 EBITDA") exceeds GOP's EBITDA for the year ended 31 December 2015 ("2015 EBITDA") ("Earn-Out Consideration"). If triggered, the Earn-Out Consideration shall be equivalent to 2.5 times the difference between 2016 EBITDA and 2015 EBITDA and shall be payable by the date no more than 20 business days after the date on which 2016 EBITDA is agreed ("Due Date") via the issue of new ordinary shares in the Company at a price determined by the average closing mid-market price in the Company's ordinary shares for the five business days prior to the Due Date. The Company will make a further announcement in due course once it has been determined whether any Earn-Out Consideration is payable.

GOP designs, manufactures and supplies lotion pumps and trigger sprayers to a broad range of customers worldwide, including a number of global brands, across a wide range of markets, including household and garden, automotive, personal care and pet grooming. GOP, which is based in Manchester, approximately 35 miles from Coral's manufacturing facility in Haydock, will continue to operate from its existing premises.

In the year ended 31 December 2015, GOP's audited sales and EBITDA were approximately £2.89 million and £0.64 million respectively. The audited net asset value of GOP as at 31 December 2015 was £1.10 million. Pursuant to the terms of the SPA, the Vendors have given warranties and indemnities in favour of the Company.

Joe Grimmond, Chairman of the Company, commented: "The acquisition of GOP is a significant milestone for Coral as it expands further the group's market coverage and product range. The board anticipates that the Acquisition will be earnings enhancing in its first year and that Coral's progressive dividend policy may continue without the group's gearing exceeding 35%."

Application has been made to the London Stock Exchange for the Placing Shares and the Consideration Shares (which, in aggregate, comprise 17,000,000 new ordinary shares) to be admitted to trading on AIM. It is expected that admission will become effective and that dealings in 16,500,000 new ordinary shares (comprising the Consideration Shares and 13,250,000 of the Placing Shares) will commence at 8.00 a.m. on 26 February 2016. The balance of 500,000 Placing Shares will be admitted to trading on 3 March 2016.

The issued share capital of the Company upon admission of all of the Placing Shares and the Consideration Shares will be 82,614,865 ordinary shares of 1 penny each. The above figure of 82,614,865 should be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company, under the Disclosure and Transparency Rules.

Following completion of the Acquisition and the Placing, Miton Group plc, which is an existing substantial shareholder in the Company and an investor in the Placing, will have a beneficial interest in 16,515,555 ordinary shares in the Company, representing 19.99 per cent. of the Company's enlarged share capital.

For more information on Coral and GOP, please visit the following websites:

www.coralproducts.com

www.one-pak.co.uk

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