KOOV.L Regulatory News (KOOV)

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN IT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO OR FROM ANY JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF LOCAL APPLICABLE SECURITIES LAWS OR REGULATIONS.

16 October 2015

For immediate release

Koovs plc

Proposed Directors' Subscription for £1.1 million of new Ordinary Shares in Koovs

Koovs plc ("Koovs", the "Company" and, together with its subsidiary undertakings, the "Group") (AIM: KOOV) today announces that certain Directors of the Company are shortly expected to subscribe for £1.1 million of new ordinary shares of one penny each ("Ordinary Shares") in the Company (the "Subscription Shares"), (the "Subscription").

The net proceeds of the Subscription will be used to fund the Group's plan to accelerate growth in its business and to provide funding for a marketing campaign in November.

The following Directors are expected to participate in the Subscription and subscribe for the following amounts:

The Subscription will be a related party transaction under Rule 13 of the AIM Rules for Companies.

A further announcement will be made in due course giving details of the Subscription, in particular the total number of new Ordinary Shares to be issued, the subscription price and the timing of expected admission of the new Ordinary Shares to trading on the AIM market of the London Stock Exchange.

Potential subsequent equity fundraising

As previously announced, the Board is in on-going discussions with potential investors to provide further, more material, funding for the Group's business. It is expected that a further tranche of equity investment, including further participation by certain of the Directors, will be announced prior to the end of 2015 and it is anticipated that such investment will be conducted at the same price that the Subscription is conducted at.

As part of this subsequent fundraising, in order to regularise the Group structure, the Board is also considering an opportunity to acquire further shares in Koovs Marketing Consulting Pvt. Ltd. ("Koovs India"), its Indian subsidiary, from Infotel E-Commerce Private Limited ("Infotel"), a company controlled by the Nahata family. Koovs is currently interested in 57.5 per cent. of the issued share capital of Koovs India and, subject to the necessary approvals, the Board is considering the acquisition of shares which would increase Koovs' interest to approximately 90 per cent. of the issued share capital of Koovs India. The funding for this investment would be achieved through the subscription for new shares in Koovs.

The subsequent equity fundraising and proposed regularisation of the Group structure is expected to be conditional upon, amongst other things, shareholder approval and may also be subject to Takeover Panel approval in relation to a potential Rule 9 whitewash of interests in the Company, to the extent they would otherwise exceed 30 per cent. of the enlarged issued share capital of the Company.

A further announcement will be made in due course.

Notes to Editors

Koovs is focused on building KOOVS.COM into the leading fashion destination in India. The Company is headquartered in London, where the majority of its design and buying team is based, with all other operational functions based in India.

Important Notice

The distribution of this announcement and any other documentation associated with the Subscription into jurisdictions other than the United Kingdom may be restricted by law. Persons into whose possession these documents come should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws or regulations of any such jurisdiction. In particular, such documents should not be distributed, forwarded to or transmitted, directly or indirectly, in whole or in part, in, into or from the United States, Australia, Canada, Japan or the Republic of South Africa or any other jurisdiction where to do so may constitute a violation of the securities laws or regulations of any such jurisdiction (each a "Restricted Jurisdiction").

The Subscription Shares have not been and will not be registered under the US Securities Act 1933 (as amended) (the "US Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States and, accordingly, may not be offered, sold, resold, taken up, transferred, delivered or distributed, directly or indirectly, within the United States except in reliance on an exemption from the registration requirements of the US Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. The Subscription Shares have not been and will not be registered under the relevant laws of any state, province or territory of any Restricted Jurisdiction and may not be offered, sold, resold, taken up, transferred, delivered or distributed, directly or indirectly, within any Restricted Jurisdiction except pursuant to an applicable exemption from registration requirements. There will be no public offer of Subscription Shares in Australia, Canada, Japan, or the Republic of South Africa.

This announcement is for information purposes only and does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in any jurisdiction and should not be relied upon in connection with any decision to subscribe for or acquire any of the Subscription Shares. In particular, this announcement does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States. The Subscription Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Subscription or the accuracy or adequacy of this announcement. Any representation to the contrary is a criminal offence in the United States.

This announcement has been issued by, and is the sole responsibility of, the Company. No person has been authorised to give any information or to make any representations other than those contained in this announcement and, if given or made, such information or representations must not be relied on as having been authorised by the Company or Peel Hunt LLP. Subject to the AIM Rules for Companies, the issue of this announcement shall not, in any circumstances, create any implication that there has been no change in the affairs of the Company since the date of this announcement or that the information contained in it is correct at any subsequent date.

Peel Hunt LLP, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting for the Company and no one else in connection with the Subscription and will not regard any other person (whether or not a recipient of this announcement) as a client in relation to the Subscription and will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing advice in relation to the Subscription or any matters referred to in this announcement.

Apart from the responsibilities and liabilities, if any, which may be imposed on Peel Hunt LLP by the Financial Services and Markets Act 2000 or the regulatory regime established thereunder, Peel Hunt LLP does not accept any responsibility whatsoever for the contents of this announcement, and makes no representation or warranty, express or implied, for the contents of this announcement, including its accuracy, completeness or verification, or for any other statement made or purported to be made by it, or on its behalf, in connection with the Company or the Subscription Shares or the Subscription, and nothing in this announcement is or shall be relied upon as, a promise or representation in this respect whether as to the past or future. Peel Hunt LLP accordingly disclaims to the fullest extent permitted by law all and any liability whether arising in tort, contract or otherwise (save as referred to above) which it might otherwise have in respect of this announcement or any such statement.

This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will", or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not historical facts. They appear in a number of places throughout this announcement and include statements regarding the Directors' current intentions, beliefs or expectations concerning, among other things, the Company's results of operations, financial condition, liquidity, prospects, growth, strategies and the Company's markets. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Actual results and developments could differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements in this announcement are based on certain factors and assumptions, including the Directors' current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Company's operations, results of operations, growth strategy and liquidity. Whilst the Directors consider these assumptions to be reasonable based upon information currently available, they may prove to be incorrect. Save as required by law or by the AIM Rules for Companies, the Company undertakes no obligation to release publicly the results of any revisions to any forward-looking statements in this announcement that may occur due to any change in the Directors' expectations or to reflect events or circumstances after the date of this announcement.