PTCM.L Regulatory News (PTCM)

17 January 2012

Porta acquires the business of Hansard Communications

Porta Communications PLC ("Porta" or the "Company") is pleased to announce that it has agreed to acquire certain assets, including key staff and all client contracts, of Hansard Communications Limited ("Hansard") (the "Transaction") in a cash and shares deal totalling a maximum of £635,594, dependent upon performance. The consideration is being satisfied by the payment of £148,094 in cash and the issue of up to 4,875,000 Porta ordinary shares at a price of 10p per share - a significant premium to the current Porta share price of 6.875p.

Hansard is an established small cap financial public relations agency currently based in the West End of London. Hansard has been operating since 2000 and has advised on numerous IPOs, M&A transactions and provided more general public relations services for companies quoted on the London Stock Exchange Main Market, AIM and Plus.

The transferring Hansard staff and client base will be incorporated within the Newgate Threadneedle business which was recently acquired by Porta. As a result the combined business will advise over 80 AIM and Main Market quoted companies and should also see Newgate Threadneedle rise to the number one position in the Morningstar/Hemscott rankings for the number of AIM clients advised. All the Hansard clients are contracted on retained fees and the Hansard team brings a good pipeline of new business opportunities which will contribute to the strong recurring revenue of Newgate Threadneedle.

In consideration for the Transaction a £148,094 cash payment will be made from Porta's existing cash resources and an initial 3,250,000 Porta ordinary shares ("Initial Consideration Shares") have been issued to Hansard Communications Limited (the "Vendor"). Up to a further 1,625,000 Porta ordinary shares ("Additional Consideration Shares") will be issued to the Vendor should a certain level of fee income be realised in the first full year post the acquisition from the existing Hansard clients and potential new business opportunities already under discussion. Completion of the Transaction is conditional upon admission of the Initial Consideration Shares to trading on AIM.

Application for the Initial Consideration Shares to be admitted to trading on AIM has been made and the new shares are expected to be admitted to trading on 20 January 2012. Following the issue of the Initial Consideration Shares, the Company expects to have a total of 74,007,008 ordinary shares in issue.

Both the Initial Consideration Shares and the Additional Consideration Shares, if issued, are subject to lock-in arrangements, whereby the Vendors have agreed not to dispose of them prior to 31 January 2013 except under very limited circumstances.

Hansard Communications Limited is wholly owned by Boldwood Limited, a Company in which Adam Reynolds and Paul Foulger are substantial shareholders. Both Mr Reynolds and Mr Foulger, who will not be joining the Porta Group, have been directors of Porta during the past 12 months and accordingly the Transaction is deemed to be a Related Party Transaction under the AIM Rules for Companies. Where a company whose shares are quoted on AIM enters into a Related Party Transaction, AIM Rule 13 requires the directors of the Company to consider, having consulted with the Company's nominated adviser, that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned.

Accordingly, the Directors consider, having consulted with Northland Capital Partners Limited, the Company's Nominated Adviser, that the terms of the Transaction are fair and reasonable insofar as the Company's shareholders are concerned.

Commenting on the transaction, Adam Reynolds, for the Vendor, said: "I am very pleased that the Hansard business has become part of a larger specialist communications company. Over the last few years Newgate Threadneedle has become one of the premier operators in financial communications and I am delighted that our clients will have access to a broader knowledge base and additional services, such as bespoke media training and a dedicated private client broking service. The team looks forward to integrating with Newgate Threadneedle and working together to enhance the growth possibilities for Porta."

David Wright, CEO of Porta, said: "The vendors are warranting certain levels of fee income in the first full year, which should produce significant profits when the business is incorporated into Newgate Threadneedle. The fact that the majority of the consideration is in shares underlines the vendors' confidence in the Porta business. Trading across Porta's operations continues ahead of management expectations and we look forward to further growing and developing the Porta Group during 2012."

For further information:

About Porta Communications

Porta Communications plc, the international marketing and communications business, is led by David Wright, Chief Executive and Chairman. David is well known for establishing Citigate in late 1988. In 1997 he reversed Citigate into Incepta plc and David became Chief Executive of the enlarged Group, later becoming Chairman. By 2003, when David left Incepta, he had built one of the largest international financial communications companies in the world, through a series of key acquisitions and an active recruitment programme, a programme that he intends to repeat through Porta.