UNG.L Regulatory News (UNG)

3 June 2013

Universe Group plc

("Universe", "the Company" or "the Group")

Acquisition

Universe Group plc, the leading developer and supplier of payment and loyalty solutions to the UK retail fuel industry, is pleased to announce the acquisition (the "Acquisition") of Indigo Retail Holdings Ltd ("Indigo") for a fixed initial and deferred consideration of £1.65 million and the issue on completion of 24 million newly issued ordinary shares of the Company ("Ordinary Shares"). Further contingent cash consideration may be payable dependent on the achievement of certain revenue growth targets.

Indigo (trading through its wholly-owned operating subsidiary, Indigo Retail Technology Limited) is an independent and privately-owned developer and supplier of Point of Sale, Back Office and Head Office management systems, as well as an integrator of related payment and loyalty software. Indigo has particular expertise in providing its specialist systems and services to independent forecourt retailers and the non-fuel convenience store market, where Universe currently has a complementary presence. Universe considers that the Acquisition will bring a number of direct and immediate benefits to the customers of both businesses. It is expected that the Acquisition will be immediately earnings enhancing for Universe.

Indigo is both profitable and cash generative and recorded turnover of £2.1m and EBITDA of £0.43m for the year ended 31 August 2012. At that date, Indigo had negligible net liabilities.

Immediately upon completion of the Acquisition ("Completion"), £0.45m will be paid in cash and 24 million new Ordinary Shares (the "Consideration Shares") will be issued to the vendors. The remainder of the total fixed consideration will be settled at the first and second anniversaries of Completion. On each occasion, the vendors will receive £0.6m of which a minimum of £0.2m will be paid in cash and the balance may, at the Company's discretion, be satisfied either in new Ordinary Shares (priced by reference to the average closing mid-market price of an Ordinary Share over the preceding 10 dealing days) or in cash.

Furthermore, an incentive plan has been put in place for the vendors under which, as deferred contingent cash consideration, they are entitled to receive a proportion of certain post-Acquisition revenue growth of the combined Indigo and HTEC Ltd ("HTEC", a subsidiary of the Company) business over the three years subsequent to Completion, capped at £1.15 million in total.

Universe's CEO, Stephen McLeod commented:

"Indigo's and HTEC's products, brands and market positions are highly complementary. Coupled with the energy and commitment of the new combined team we expect to offer and deliver attractive and compelling products and services to retailers in the convenience and independent market segments.

We are pleased that the vendors of Indigo have chosen to take a significant proportion of the sale consideration in Universe shares and that they share our confidence in the prospects for the enlarged entity.

Having achieved the turnaround and set clear strategic objectives, this acquisition is a natural next step for Universe. We continue to assess a range of other small acquisitions but will proceed with them only if they are as compelling as the Acquisition announced today."

Application has been made for the Consideration Shares to be admitted to trading on AIM and it is expected that admission will occur on 5 June 2013. Subsequent to the issue of the Consideration Shares (which will comprise approximately 11.3 per cent. of the fully-diluted share capital of Universe), the total number of Ordinary Shares in issue will be 211,530,626 with each Ordinary Share carrying the right to one vote.

This figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or a change to their interest in, the Company under the Disclosure and Transparency Rules.

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