Learning Technologies Group Regulatory News (LTG)

IN-DEED ONLINE PLC 

Placing of up to 3,771,426 new Ordinary Shares at 42 pence per share

Admission of the Enlarged Issued Share Capital to trading on AIM 

1. INTRODUCTION AND BACKGROUND

The Company's business is to provide buyers and sellers of residential property in England and Wales with access to a high quality conveyancing service executed by a panel of third party licensed conveyancers and/or solicitors. The Company advertises and attracts customers to the Website through digital media marketing. Service to customers is then delivered by members of the Panel via the Company's online technology platform. 

Harry Hill and Peter Gordon founded the Company in 2010. Harry (executive Chairman) was CEO of Europe's largest estate agency chain, Countrywide plc, from 1988 until 2008. Under Harry's direction, Countrywide plc founded Rightmove plc, the UK's largest property portal. Peter Gordon (Managing Director) was at 3i Group plc from 1989-98 and 2000-2008, latterly as a Partner in its buy-out business. Amongst his achievements, he led 3i's profitable investment in Legal Marketing Services, a provider of bulk legal services for remortgage and conveyancing. 

As part of its long-term growth strategy, the Company may leverage its brand and platform to offer access to other business-to-consumer legal services with will-writing, family law and personal accident being considered. 

The core skills delivered by the Company's management team are: 

(i) Panel management: sourcing, assessing, contracting with and monitoring of suitable law firms/ 

licensed conveyancers to provide the legal services to customers; 

(ii) Technology: development and maintenance of the technology platform; and 

(iii) Marketing: promoting the Company and its services to customers. 

The Company concluded a process of beta testing of the Website and the Panel ahead of its marketing launch on 23 May 2011. The Company has only just commenced marketing and opened the Website to the public and, whilst the Directors are confident that the Website will be well received, it is too soon to draw meaningful conclusions about the effectiveness of marketing channels.

2. MARKET OVERVIEW

Over the last 35 years the average number of residential property transactions in the UK has been approximately 1.3 million per annum (source: Land Registry and HMRC). Conveyancing transactions typically comprise two conveyancing instructions (a sale and a purchase). The Directors estimate that the average fee charged by lawyers/licensed conveyancers for completing a conveyancing instruction is approximately £500 which equates to an estimated potential market size of £1.3bn. Current transactions are running well below the average at 884,000 in 2010 (859,000 in 2009) and the Directors are not forecasting a material recovery in volumes within their plans. However the historic evidence described above would suggest there is potential for growth in the market. 

The conveyancing market in England and Wales is fragmented with no clear market leader. Countrywide Property Lawyers is the largest participant and is estimated by the Directors to have less than 3 per cent.

market share. The Directors estimate that more than 5,000 individual legal firms perform conveyancing transactions in a typical month (source: Land Registry).

The distribution of conveyancing services is the Company's core focus at present. However, the Directors believe that the ''In-Deed'' brand and the Website has the potential to expand so as to offer access to other business-to-consumer legal services and the Directors intend to explore will writing as a priority before considering personal accident and other products. The ability to leverage the Company's brand and technology platform to offer these products should significantly expand the Company's addressable market as well as bringing economies of scale.

3. KEY STRENGTHS 

The Directors consider that the Company's operations and business model have the following key 

strengths: 

* Scalability: the operations of the business are largely focussed on marketing, technology and 

management of the Panel and as such the Company has a low fixed cost base. 

* Leading technology offering: the Company has already invested significant capital and 

resource in technology.

* Market growth: the current level of residential conveyancing transactions is low relative to the 

average over the last 35 years.

* Cash generative and minimal counterparty risk: the Company's business model has an 

attractive cashflow profile.

* Management track record: Collectively, the Board has significant experience in the residential 

property market in England and Wales together with the management of panels of lawyers 

and law firms. The Directors also have a proven track record of shareholder value 

creation. 

* Strategically well positioned in the market for distribution of residential conveyancing services. 

GROWTH STRATEGY 

The Directors believe that opportunity in the Company's chosen marketplace will be maximised by adopting the following strategy:

* Maintaining its leading technology through further investment and development in the Website and its IT integration with members of the Panel.

* Establishing the ''In-Deed'' brand as a trusted source of business-to-consumer legal services with a reputation for quality, transparency and for empowering consumers in the conveyancing process. 

* Reaching the market through a diversity of digital media channels including, but not limited to, property websites. 

* Maintaining and growing a panel of legal firms who are able to grow their businesses with the development of the Company.

* Maximising the opportunity in its existing business whilst pursuing other potential opportunities to broaden the range of business-to-consumer legal services to which it provides access

SUMMARY FINANCIAL INFORMATION 

The Company was incorporated on 3 March 2010 and financial information has been prepared for

the period ended 31 March 2011.

Further information on the Company is contained in its AIM Admission Document

Income Statement Period ended 

31 March 2011

£ 

Revenue - 

Gross profit - 

(Loss) from operations (471,759) 

(Loss) for the period (471,013) 

Balance Sheet 

Net assets/(liabilities) 565,628

6. PLACING AND ADMISSION

Placing arrangements 

The Company is proposing to raise £1,583,998.92 before expenses, by way of a placing by Numis of up to 3,771,426 Ordinary Shares at the Placing Price to institutional and other investors. The Placing Shares will represent approximately 18.49 per cent of the Enlarged Issued Share Capital and will rank pari passu in all respects with the Existing Ordinary Shares including the right to receive dividends and other distributions thereafter declared, made or paid. 

Pursuant to the Placing Agreement, Numis has conditionally agreed to use reasonable endeavours to procure placees to acquire 3,771,426 Placing Shares at the Placing Price as agent for the Company. 

On Admission, the Directors directly and indirectly will hold in aggregate 4,559,523 Ordinary Shares, representing approximately 22.35 per cent. of the Enlarged Issued Share Capital. On Admission, at the Placing Price, the Company will have a market capitalisation of approximately £8.568 million (assuming the Placing is fully subscribed). 

Lock-in arrangements 

The Directors have undertaken with the Company and Numis (subject to certain exceptions): (i) not to dispose of any interest in any of their Ordinary Shares (amounting in aggregate to 4,559,523 Ordinary Shares, representing approximately 22.35 per cent. of the Enlarged Issued Share Capital) until the first anniversary of Admission; and (ii) to observe certain orderly market restrictions with respect to the disposal of such Ordinary Shares for a further period of twelve months thereafter.

Certain other shareholders who, in aggregate, following Admission, are expected to hold 5,200,000 Ordinary Shares (representing approximately 25.49 per cent. of the Enlarged Issued Share Capital (assuming the Placing is fully subscribed)) have undertaken with the Company and Numis (subject to certain exceptions) that they will not, without the prior consent of Numis, dispose of any interest in any of their Ordinary Shares for a period of twelve months following Admission.

PLACING STATISTICS

Number of Ordinary Shares in issue at date of the Admission Document 16,628,574

Number of Placing Shares1 3,771,426

Placing Price 42 pence

Estimated net proceeds of the Placing receivable by the Company2 £1.169 million

Enlarged Issued Share Capital immediately following Admission1 20,400,000

Percentage of Enlarged Issued Share Capital represented by the

Placing Shares1 18.49% 

Market capitalisation of the Company immediately following 

Admission at the Placing Price1 £8.568 million 

ISIN GB00B4T7HX10 

SEDOL Number B4T7HX1 

AIM Symbol IOL 

1 Assuming that the Placing is fully subscribed.

2 The estimated net proceeds receivable by the Company are stated after deduction of the estimated fees and 

expenses of the Placing (including Value Added Tax) payable by the Company, which are currently estimated to 

be £0.415 million. 

DEFINED TERMS

ENDS

For further information, the company's AIM Admission Document can be viewed at http://www.in-deed.net/investor-relations/documents

In-Deed Online Limited

Peter Gordon/Cottie Petrie-Norris

tel: +44 (0) 20 7401 9559

Numis Securities Limited

+44 (0)20 7260 1000

Stuart Skinner / Andrew Holloway (Nominated Adviser)

David Poutney / James Serjeant (Broker)

Third City (Financial PR)

Mark Lowe/Graz Belli

+44 (0) 020 3174 1023