KOOV.L Regulatory News (KOOV)

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014.

Koovs plc ("Koovs" or the "Company")

Strategic Agreement with HT Media & Capital Raising Update

The Board of Koovs plc (AIM: KOOV), ("Koovs" or the "Company") is pleased to announce that it has entered into a conditional agreement for a 2-year, £24.0m media deal (the "Agreement") with strategic partner HT Media Limited ("HT Media"). HT Media is one of India's largest media companies and owner of the Hindustan Times.

Under the Agreement, and subject to satisfaction of the principal condition set out below, the Company will acquire four £6m tranches of media from HT Media at six monthly intervals over a twenty-four-month period, 70% of which (£4.2m) in each instalment will be satisfied by the issuance of new ordinary shares in the Company to HT Media, with the balancing 30% (£1.8m) to be acquired by Koovs in cash.

Strategic Agreement overview & capital raising update

The Agreement is conditional upon an initial cash raise of at least £6m by the Company (the "Initial Equity Raise"). The Company has already had positive discussions with existing and potential new shareholders regarding support for the Initial Equity Raise. The exact amount of new capital to be raised under the Initial Equity Raise will be determined by the Board in discussion with investors.

On satisfaction of this condition, the Agreement will, in aggregate, provide Koovs with £16.8m of media and advertising services from HT Media in exchange for the issuance of new ordinary shares in the Company to HT Media, alongside which Koovs agrees to commission further media and advertising services from HT Media for £7.2m in cash to be drawn in four tranches over the 2-year period.

The conversion price for the first £4.2m tranche of new shares to be issued to HT Media is to be 10 pence per Koovs share. Thereafter each tranche will be priced at the lower of Koovs' then 3-month average closing share price or the price of the most recent round of equity fundraising by the Company.

Under the Agreement, HT Media will not be obliged to acquire more than 20% of the Company's prevailing total issued share capital and the Agreement is also subject to the Company's prevailing market value not being below a nominal level during the course of the Agreement.

The Agreement announced today follows on from the announcement of the Company's Strategic Acceleration Plan (the "Plan") on 1st March 2018. Upon completion of the Initial Equity Raise and then the Agreement between Koovs and HT Media, the Company will have successfully concluded the first stage of the Company's fundraising strategy to raise a total of up to £50m of investment to fund the Plan. As previously outlined, a significant part of this investment will be devoted to marketing and brand, and completion of the Agreement and Initial Equity Raise is expected to reduce the outstanding fundraising requirement by approximately £23m.

Mary Turner, Chief Executive of Koovs, said:

"We are delighted to have agreed this deal with HT Media, one of India's most influential media companies. It will mark the successful completion of the first round of funding for our strategic acceleration plan, providing us with an important platform to support our future growth.

"As India's best-established affordable fashion brand, we are resolutely focused on scaling the business to leverage our competitive advantages in what is the world's fastest growing economy."

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About Koovs

Koovs achievements since IPO in 2014

Koovs sells affordable western fashion in India online. In the four years since its IPO in London, the Company has succeeded in establishing:

· Significant and growing social media following and customer engagement

o 2.4 million followers including 1.9 million on Facebook and 500,000 on Instagram

· A leading brand that is fashion-forward and affordable

o Recent RedSeer survey showed that Koovs continues to outperform other platforms on product variety and quality

· A technology platform delivering seamless customer experience

o In FY17 Koovs implemented the latest modular microservices architecture to deliver scalable performance, rapid technology development and innovation

· Koovs' own label and designer collaborations already leading fashion trends in India

o 40% of FY17 sales were Koovs Private Label, and four exclusive collections were launched with Manish Arora, Hattie Stewart, Gauri & Nainika and Henry Holland

· Highly experienced Management team

o Over 125 years' combined retail and technology experience

· First class logistics and lead times

o Average 'order to delivery' time in January 2018 was 3.5 days compared to average of over 4 days amongst India e-tailers

· Industry-leading customer care metrics

o Forrester survey ranked Koovs No.1 for "Best Customer Experience" among online-only retailers in India and RedSeer awarded Koovs the highest Net Promoter Score amongst peers

o Over £70 million invested in Koovs to date establishing itself as leading affordable fashion brand in India