ISG.L Regulatory News (ISG)

30 December 2015

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO, OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

ISG plc ("ISG")

REVISION OF SHAREHOLDER CIRCULAR

ISG announces that it will be shortly posting to shareholders a revised circular (the "Revised Circular") explaining why it believes shareholders should reject the offer from Cathexis UK Holdings Limited ("Cathexis") at 143p per share (the "Offer").

In section 3.1 of Part 1 of the Company's original defence circular (the "Original Circular") published on 23 December 2015, ISG compared the implied forward 2016 and 2017 PE ratios of ISG at the Offer Price with the average forward PE ratios of ISG's peer group for these years, in each case calculated by reference to a consensus of analysts' forecasts.

Under the Takeover Code, reference by an offeree company to an investment analyst forecast constitutes a profit forecast by the company itself and, accordingly, the reference by ISG in the Original Circular to consensus forecasts for 2016 and 2017 triggered requirements for ISG:

1. in accordance with Rule 28.1(a)(i), to publish a report from ISG's reporting accountants stating that, in their opinion, the forecast ISG earnings per share number for the year ending 30 June 2016 had been properly compiled on the basis stated and that the basis of accounting used was consistent with ISG's accounting policies;

2. in accordance with Rule 28.1(a)(ii), to publish a report from ISG's financial adviser stating that, in its opinion, the forecast ISG earnings per share number for the year ending 30 June 2016 had been prepared with due care and consideration; and

3. in accordance with Rule 28.2(a), to include a statement by the Directors confirming that the forecast ISG earnings per share number for the year ending 30 June 2017 was valid and had been properly compiled on the basis of the assumptions stated and that the basis of accounting used was consistent with ISG's accounting policies.

ISG is not able to comply with these requirements and, accordingly, has been required by the Takeover Panel to withdraw section 3.1 of the Original Circular and the supporting calculations in Appendix 2, and is today therefore publishing the Revised Circular. Shareholders should rely only on the Revised Circular in reaching any conclusions on the merits of the Offer (and, in particular, shareholders should not place any reliance on the consensus forecasts for ISG for 2016 and 2017 set out in section 3.1 of the Original Circular since ISG has not been able to substantiate these forecasts).

In all other respects the Board, which has been advised throughout by Numis, stands by its rejection of the Offer.

The Revised Circular will be available to view at http://investors.isgplc.com/ and the Original Circular has been deleted from the website.

Enquiries:

ISG plc

Numis

Disclaimer

Numis Securities Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for ISG and no one else in connection with the Offer and the contents of this announcement and will not be responsible to anyone other than ISG for providing the protections afforded to its clients nor for providing advice in connection with the Offer or any matter referred to herein.

Publication on Website

A copy of this announcement will be available on the Company's website (www.isgplc.com) by no later than 12 noon (London time) on 31 December 2015. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

Responsibility statement

The Directors of ISG accept responsibility for the information contained in this announcement. To the best of the knowledge and belief of the Directors, who have taken all reasonable care to ensure such is the case, the information contained in this announcement is in accordance with the facts and does not omit anything likely to affect the import of such information.