Yu Energy Regulatory News (YU.)

10 August 2020

Yü Group PLC

("Yü Group" or the "Group")

Acquisition of Bristol Energy's B2B business

Yü Group PLC, the independent supplier of gas, electricity and water to the UK business sector is delighted to announce that it has completed the acquisition of the B2B customer book ("B2B Book") from Bristol Energy Limited ("Bristol Energy") a wholly owned subsidiary of Bristol City Council (the "Acquisition").

Transaction highlights

· The Acquisition will add c. 4,000 meter points to Yü Group's current meter portfolio of c. 9,800, an increase of c. 40% to the Group's current meter base.

· The Board expects the Acquisition to be immediately earnings enhancing.

· The B2B Book consists of a broad range of gas and electricity supply contracts running for up to three years, servicing a range of public sector and business customers. The Acquisition does not include Bristol Energy's forward commodity purchases.

· Bristol Energy uses common operating platforms enabling a seamless transition, with contracts transferring to Yü Group's systems in August 2020.

· As part of the Acquisition, Bristol Energy's B2B industry specialist personnel will transfer to Yü Group.

· The Acquisition will enable the Group to enhance gross margin and generate economies of scale through utilising:

o the Group's scalable technology platform to complement the new book with accelerated organic growth to generate a lower cost to serve and leverage fixed overheads;

o the Group's sophisticated CRM system to enable the provision of a wider product range;

o enhanced trading capabilities on the increased volumes of energy to forward hedge; and

o the ability for Yü Group to hedge commodity volume on lower forward commodity market prices than those assumed in the contracts acquired.

Information on Bristol Energy

Bristol Energy has established relationships with a focussed and resilient customer base in Bristol and the South West. All customers are on fixed contracts with the opportunity for fully green products. The B2B Book supplies a broad range of sectors, including Bristol City Council.

Bristol Energy management will provide full support for Yü Group throughout the transition of the contracts. All parties will follow Ofgem's best practice for customer migration.

Based on management accounts, the B2B book, for the financial year to 31st March 2020, showed revenues of £15.2m and generated an operating loss of £0.48m.

Terms of the Acquisition

Yü Group has paid £1.24m in cash on completion and, as part of the Acquisition, has acquired £1.0m of receivables of which the majority is due for payment to Yü Group in August 2020. A further £100,000 is payable by the Group deferred for three months. In addition, the Group has assumed liabilities totalling £580,000 payable in August 2021.

Bobby Kalar, Chief Executive of Yü Group, commented:

"We are delighted to have successfully executed the purchase of Bristol Energy's B2B Book post extensive due diligence. The transaction allows the Group to layer in a fantastic customer base to our accelerating organic portfolio and increase value by offering additional products and services not available previously. This Acquisition forms part of our strategic growth plan, leverages our disciplined controls and scalable technology platform and highlights the Group's ability and appetite to scale.

Immediate opportunities to synergise the customer book will further our ability to extract value while keeping overheads down. Management's objective will be to transition Bristol Energy customers onto our platform quickly and seamlessly while enhancing value and creating a proven template for further value additive potential acquisitions.

I remain convinced that there is a substantial market opportunity for Yü Group. With significant organic growth potential and a strong balance sheet, we see a great opportunity to increase market share and drive sustainable, profitable growth, creating value for all our stakeholders."

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Notes to Editors

Information on the Group

Yü Group PLC, trading as Yü Energy, is an independent supplier of gas, electricity and water focused on servicing the corporate sector throughout the UK. It has no involvement in the domestic retail market. The Group was listed on the AIM market of the London Stock Exchange in March 2016.