Monitise Regulatory News (MONI)

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

23 January 2015

Monitise plc

Statement re. media speculation

Monitise plc (LSE: MONI.L) ("Monitise", the "Company" or "Group") notes the media speculation in connection with the initiation of its Strategic Review on 22 January 2015 and confirms that it has received a number of expressions of interest in a range of potential corporate transactions including a merger with a third party or a sale of the Company.

Discussions are at a highly preliminary stage and there can be no certainty that any transaction will result.

As stated on 22 January 2015, the Strategic Review will be all encompassing and include consideration of a range of corporate transactions and stock market listing options.

Monitise remains well funded and debt free with £129 million of gross cash, as at 31 December 2014. The Board believes that the Company has a unique set of global partners and customers, and reiterates its expectation to be EBITDA profitable in FY 2016 (the "FY 2016 Profit Forecast"). The Board also reiterates guidance of 200 million users and £2.50 ARPU by end FY 2018, based on the scale of the market opportunity and partnerships in place.

Enquiries:

A copy of this announcement will be available on the Company's website at www.monitise.com as soon as possible. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

Takeover Code

This announcement is not an announcement of a firm intention to make an offer under Rule 2.7 of the Code and there can be no certainty that an offer will be made, nor as to the terms on which any offer will be made.

Any discussions in relation to a merger with a third party or a sale of the Company are taking place within the context of a "formal sale process" as defined in The Takeover Code (the "Code") in order to enable conversations with parties interested in making such a proposal to take place on a confidential basis.

Parties with a potential interest in making an offer for, or merging with Monitise should contact Moelis & Company (contact details as set out below). Any interested party will be required to enter into a non-disclosure agreement with the Company on terms satisfactory to the Board and on the same terms, in all material respects, as the other interested parties, before being permitted to participate in the process. The Board reserves the right to alter any aspect of the process or to terminate it at any time and will make further announcements as appropriate. The Board reserves the right to reject any approach or terminate discussions with any interested party or participant at any time.

As explained in the announcement regarding the Trading Update and Initiation of the Strategic Review (including commencement of offer period under the Takeover Code) that was issued on 22 January 2015 (the "22 January Announcement") the Takeover Panel has granted a dispensation from the requirements of Rules 2.4(a), 2.4(b) and 2.6(a) of the Code such that any interested party participating in the formal sale process will not be required to be publicly identified (subject to note 3 to Rule 2.2 of the Code) and will not be subject to the 28 day deadline referred to in Rule 2.6(a), for so long as it is participating in the formal sale process. As set out in the 22 January Announcement, interested parties should note Rule 21.2 of the Code, which will prohibit any form of inducement fee or other offer-related arrangement, and that the Company, although it may do so in the future, has not at this stage requested any dispensation from this prohibition under Note 2 of Rule 21.2.

In accordance with Rule 28.1(c)(i) of the Code, the Board of Monitise confirms that the statements relating to FY 2015 and FY 2016 EBITDA herein have been properly compiled on the basis of the assumptions stated below and that the basis of accounting used is consistent with the Company's accounting policies.

BASIS OF PREPARATION OF AND ASSUMPTIONS FOR FY 2015 AND FY 2016 PROFIT FORECASTS

As stated on 22 January 2015, Monitise expect a FY 2015 EBITDA loss of £40-50m (the "FY 2015 Profit Forecast").

Set out below is the basis of preparation in respect of the FY 2015 Profit Forecast and the FY 2016 Profit Forecast (together the "Profit Forecasts"), together with the assumptions on which they are based.

Basis of preparation

The FY 2015 Profit Forecast is based on the draft unaudited half year financial statements of Monitise for the six months ended 31 December 2014 and the management account forecasts for the six months ended 30 June 2015. The FY 2016 Profit Forecast is based on the management account forecasts for the 12 months ended 30 June 2016. The Profit Forecasts have been prepared on a basis consistent with the current accounting policies of the Company. The Profit Forecasts exclude any transaction costs applicable to the Strategic Review or any other associated accounting impacts as a direct result of the Strategic Review.

Assumptions

The Profit Forecasts are based on the following assumptions for the period to which they relate:

Factors outside the influence or control of the Monitise Board:

· There will be no material changes to prevailing global macroeconomic or political conditions

· There will be no material changes to the conditions of the markets in which Monitise operates.

· The main exchange, inflation and tax rates in Monitise's principal markets will remain materially unchanged from the prevailing rates.

· There will be no material adverse events that will have a significant impact on Monitise's financial performance.

· There will be no material changes in legislation or regulatory requirements impacting on Monitise's operations or its accounting policies.

· The announcement of the Strategic Review will not result in any material changes to Monitise's obligations to customers.

Factors within the influence and control of the Monitise Board:

· The announcement of the Strategic Review will not have any material impact on Monitise's ability to negotiate new business.

· Successful realignment of the cost base with the transition to the new business model.

FORWARD LOOKING STATEMENTS

This announcement contains (or may contain) forward-looking statements. Whilst these forward-looking statements are made in good faith they are based upon the information available to Monitise at the date of this announcement and upon Monitise's or, as appropriate, Monitise's Directors' current expectations, projections, market conditions and assumptions about future events. These forward looking statements are subject to risks, uncertainties and assumptions about Monitise and its Group, including, among other things, the development of its business, trends in its operating industry, and future capital expenditure. In light of these risks, uncertainties and assumptions, the events or circumstances referred to in the forward-looking statements may differ materially from those indicated herein. None of the projections, expectations, estimates or prospects set out in this announcement should be taken as forecasts or promises nor should they be taken as implying any indication, assurance or guarantee that the assumptions on which such future projections, expectations, estimates or prospects have been prepared are correct or exhaustive or, in the case of the assumptions, fully stated in this announcement. Accordingly these forward-looking statements should be treated with an appropriate degree of caution and you should not place undue reliance on any forward-looking statements as a prediction of actual results or otherwise. None of Monitise, its Group, nor any of its directors, their respective affiliates, or individuals acting on their behalf undertake to publicly update or revise any such forward-looking statements set out in this announcement, whether as a result of new information, future events or otherwise. Other than the Profit Forecasts, no statement in this announcement is or is intended to be a profit forecast or profit estimate or to imply that the earnings of the Group for the current or future financial years will necessarily match or exceed the historical or published earnings of the Group. Past performance is no guide for future performance and persons reading this announcement should consult an independent financial adviser.

Disclosure requirements of the Takeover Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

RESPONSIBILITY

The directors of Monitise accept responsibility for the information contained in this announcement. To the best of the knowledge and belief of those directors (who have all taken reasonable care to ensure that such is the case), the information contained in this announcement for which they accept responsibility is in accordance with the facts and does omit anything likely to affect the import of such information.

FURTHER INFORMATION

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities whether pursuant to this announcement or otherwise. The distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities law of any such jurisdiction.

This announcement is being issued outside the United States pursuant to and in accordance with Rule 135e under the U.S. Securities Act of 1933, as amended (the "Securities Act"). This announcement shall not constitute or form a part of any offer of, or solicitation to purchase or subscribe for, any securities, nor shall there be any sale of any securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. The securities referred to in this announcement have not been, and will not be, registered under the Securities Act and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons (as such term is defined in Regulation S under the Securities Act), except pursuant to an exemption from the registration requirements of the Securities Act. No public offering of securities will be made in the United States or in any other jurisdiction where such an offering is restricted or prohibited.

Moelis & Company is acting exclusively as financial adviser to Monitise and no one else in connection with the matters described in this announcement. In connection with such matters, Moelis & Company will not regard any other person as their client, nor will they be responsible to any person other than Monitise for providing the protections afforded to clients of Moelis & Company or for providing advice in connection with the matters described in this announcement or any matter referred to herein.

Canaccord Genuity Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as NOMAD and Broker to Monitise and is acting for no-one else in connection with the transactions herein and will not be responsible to anyone other than Monitise for providing the protections afforded to clients of Canaccord Genuity Limited nor for providing advice in connection with the transactions or any other matter referred to herein.