Sysgroup Regulatory News (SYS)

14 August 2014

Daily Internet plc

("Daily Internet" or the "Group" or the "Company")

Acquisition of Evohosting Limited and Subscription to raise £435,000

Daily Internet plc (AIM: DAIP), the hosting and cloud infrastructure as a service ("IaaS") provider, is pleased to announce the acquisition of the entire issued share capital of Evohosting Limited ("Evohosting") for a total cash consideration of £395,000 and a subscription to raise £435,000, at a subscription price of 2p per share, with existing institutional investors (the "Subscription").

Evohosting

Based in Maidenhead, Evohosting supplies domain name and shared hosting services to a diverse range of over 5,000 active customers. Evohosting brings a strong customer base to which the Group can cross-sell its existing services.

For the year ended 31 May 2013, Evohosting had EBITDA adjusted for non-recurring items of £156,000 and turnover of £419,000.

Once integrated into the Group (which is expected to be completed approximately three months from completion of the acquisition), Evohosting will be able to market the whole range of Group products. In addition, overall operational costs are expected to be reduced through efficiencies. The acquisition is expected to be immediately earnings enhancing to the Group as a whole.

The Evohosting brand and its office and staff in Maidenhead will be retained.

Terms of the acquisition

Of the total consideration of £395,000, £370,000 will be paid on completion and a further £25,000 will be placed into escrow and will be payable 60 days from completion. In addition, further consideration equal to Evohosting's net cash will be payable when agreed or determined.

The consideration will be satisfied from the net proceeds of the Subscription.

Subscription

The Group has raised £435,000 (before expenses) through the issue of 21,750,000 new ordinary shares of 0.5p per share at a subscription price of 2p per share ("Subscription Shares") with existing institutional investors.

Application will be made to the London Stock Exchange for the Subscription Shares to be admitted to trading on AIM and it is expected that admission will become effective and that dealings in the Subscription Shares will commence on 21 August 2014.

Following admission of the Subscription Shares, the issued ordinary share capital of the Company will be 449,202,866.

Abby Hardoon, Managing Director of Daily Internet plc, commented: "We are delighted to announce the acquisition of Evohosting which will be immediately earnings enhancing to the Group and offers a range of cross-sell and upsell opportunities once integrated. We are also pleased that the Company's existing shareholders continue to support our acquisition strategy as demonstrated by their participation in the subscription. We continue to seek earnings enhancing acquisitions in order to add critical mass to the Company's operations."

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