Kingswood H. Regulatory News (KWG)

25 June 2014

European Wealth Group Limited

("European Wealth", or "the Group")

Acquisition of Compass Financial Benefits Limited

Placing to raise £674,000

Loan Conversion

European Wealth (AIM: EWG, EWGL), the fast growing wealth management group, is pleased to announce that it has agreed to acquire Compass Financial Benefits Limited ("Compass"), an IFA business with £31million of funds under influence. European Wealth is also pleased to announce that it has raised approximately £674,000 via a placing of 749,303 new 5p ordinary shares in EWG ("Ordinary Shares"), at a price of 90p per Ordinary Share (the "Placing").

The Acquisition

Compass is being acquired for a maximum consideration of three times its recurring income (being Compass's retail distribution review compliant recurring income) for the 12 months following completion. The consideration is payable in two tranches; an initial tranche, payable on completion, of £539,150, to be satisfied half in cash, being £269,575, (the "Initial Cash Consideration") and half in 269,575 new Ordinary Shares at a price of 100p per share (the "Consideration Shares"), based on the 10 business day average mid market closing price up to and including 23 June 2014. The remainder of any consideration due will be similarly be satisfied half in in cash and half in new Ordinary Shares (the "Deferred Consideration").

About Compass

Compass is a family-run, IFA business based in Kingston, Surrey with approximately £31million of funds under influence. In the year to December 2013, Compass had turnover of £434,230, of which approximately 76% was recurring income, and recorded a pre-tax profit of £154,250. The principals are John and Michael Robinson.

The business will be relocated and fully integrated into European Wealth's head office in London and both John and Michael Robinson will be appointed Associate Directors of European Financial Planning, EWG's financial planning subsidiary.

The Placing

The 749,303 new Ordinary Shares issued under the Placing (the "Placing Shares") have been placed with existing and new investors, together with participation from some Group employees. The proceeds of the Placing will be used to cover the Initial Cash Consideration and for the general working capital purposes of the Group.

Commenting on the Acquisition and the Placing, John Morton, Executive Chairman of European Wealth, said;

"We are pleased to have completed our first acquisition since coming onto the market in May. Whilst small, it will not only strengthen our presence in the Group Personal Pension scheme market ("GPP") where we see significant opportunities domestically, but also allow us potentially to leverage our Investment Management services to Compass's clients. We also see significant scope for improving Compass's operating costs whilst at the same time continuing to grow our overall funds under management and influence. We consider our AIM listing as an important mechanism for completing further selective acquisitions as we continue to increase our funds under management and influence."

Loan Conversion

In addition, and further to the loan agreement disclosed in the admission document dated 16 April 2014 between the Group's subsidisary, European Wealth Management Group Limited ("EWMG") and Hearth Investments Limited ("Hearth") to borrow £40,000; Hearth has agreed to convert the entire loan plus interest, amounting to £40,997, into 56,940 new Ordinary Shares at a price of 72p, being the price agreed in the original agreement dated 25 March 2014 ("Hearth Shares").

Admission

Application will be made for the Consideration Shares, the Placing Shares and the Hearth Shares to be admitted to trading on AIM and admission is expected to occur at 8:00am on 30 June 2014 ("Admission").

Following Admission, the Group will have in issue 14,248,733 Ordinary Shares. The Group does not hold any Ordinary Shares in treasury. Therefore the number of Ordinary Shares with voting rights in the Group will be 14,248,733. This figure may be used by shareholders as the denominator for the calculations by which they can determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rules.

Substantial shareholdings

The following substantial shareholders have increased their percentage holding on Admission of the Hearth Shares and Placing Shares:

For further details, please contact:

European Wealth Group Limited

John Morton, Rod Gentry: +44 (0)20 7293 0733

www.ewgrouplimited.com

Daniel Stewart & Company Plc - Nominated Adviser and Broker

Antony Legge, Ciaran Walsh, Mark Treharne: +44 (0)20 7776 6550

GTH Communications

Toby Hall: +44 (0)20 7822 7493 / +44 (0)7713 341072

About European Wealth Group Limited

European Wealth Group Limited (AIM: EWG, EWGL).is the holding company for the fast growing wealth management business, European Wealth Management Group Limited. Having commenced trading in 2010, European Wealth has two operating divisions, European Investment Management Limited ("EIM") and European Financial Planning Limited ("EFP"). Both are regulated by the FCA and were established to be RDR compliant from the outset, EIM opting for Restricted Adviser status and EFP for Independent Adviser status. Today the Group's head office is in London with a network of five local offices across the South East. Core services offered by the Group are financial planning, corporate pension advisory and investment management in both equity and fixed interest instruments. For further information on European Wealth's wealth management and financial planning services, please go to www.europeanwealth.com.

ENDS