Proposed Acquisition, Fundraise and Trading Update

6 April 2018

appScatter Group plc

("appScatter" or the "Company")

Proposed Acquisition and Fundraise

Trading Update

appScatter Group plc (AIM: APPS), the scalable business-to-business ("B2B") Software as a Service ("SaaS") platform that allows users to distribute and manage their apps on multiple app stores around the world, today announces the proposed acquisition by the Company of Priori Data GmbH ("Priori"), a B2B SaaS platform provider of mobile app intelligence (the "Acquisition").

Highlights

The Board of appScatter believes the proposed acquisition of Priori will:

· Create a source of app data intelligence drawing on 299 billion downloads across five million apps in 55 categories as well as six billion devices across 252 territories.

· Complete appScatter's existing offering by placing Priori's app data intelligence capability alongside appScatter's app management platform encompassing distribution, analytics, intelligence and the appScatter marketplace.

The Company has entered into a conditional sale and purchase agreement for the acquisition of 100 per cent. of the share capital of Priori for a total consideration payable on completion of the Acquisition of £13.5 million, of which £9.45 million will be payable in cash (the "Cash Consideration") and £4.05 million will be satisfied by way of the issue of 5,785,715 new ordinary shares in the Company (the "Consideration Shares") at an effective issue price of 70 pence per ordinary share.

To effect the Acquisition, the Company will need to complete an associated fundraising, to fund the Cash Consideration and to provide additional working capital resources for the enlarged group, of not less than £15 million, before expenses. As at the date of this announcement, the Company confirms that it has received formal indications of interest, with the majority from existing investors, for direct subscriptions and through a potential placing in respect of a proposed fundraise by way of the issue of new ordinary shares in the Company at a price of 70 pence per ordinary share in respect of an aggregate of £15 million.

Further announcements in relation to the proposed fundraise by way of a placing with institutional and other investors and/or direct subscriptions (the "Proposed Fundraise") will be made, as appropriate, in due course.

Completion of the Acquisition is conditional, inter alia, on the despatch by the Company to its Shareholders of a circular in substantively agreed form and the passing, at a duly convened general meeting, of the resolutions in the form set out in the circular.

The Proposed Fundraise will be, conditional, inter alia, upon the approval of appScatter Shareholders. A general meeting to approve the necessary resolutions for the issue and allotment of the Consideration Shares and the Proposed Fundraise shares (the "New Ordinary Shares") and to permit disapplication of pre-emption rights (the "Resolutions") in respect of the Proposed Fundraise shares (the "General Meeting") will be convened only once legally binding commitments of £15 million in respect of the Proposed Fundraise are confirmed. A circular providing further details of the Acquisition and the Proposed Fundraise and convening the General Meeting, will be posted to appScatter shareholders shortly after this confirmation has been obtained in due course.

The long stop date for the Acquisition under the Acquisition Agreement (defined below), and therefore for the completion of the Proposed Fundraise, is 15 May 2018.

Commenting on the Acquisition, Philip Marcella, Chief Executive Officer of appScatter Group plc, said:

We believe that this is exciting news for the customers of both companies. Priori publishers and clients will, on completion of the Acquisition, benefit from wider distribution of their mobile apps across 75 app stores and appScatter clients will benefit from new services including keyword (ASO), app and market intelligence.

The Acquisition would mark a major step forward in our quest to become the go-to source of information in the app ecosystem, in particular given the scarcity of companies with the quantity of data held by Priori."

For further information contact:

Market abuse regulation (MAR) disclosure

Certain information contained in this announcement would have been deemed to be inside information for the purposes of article 7 of Regulation (EU) No 596/2014 until the release of this announcement. This announcement has been issued by and is the sole responsibility of the Company.

About Priori

Founded in 2013, Priori is a B2B SaaS platform provider of mobile app intelligence based in Berlin, Germany with proprietary core data intelligence software and 16 full time employees with experience in monetising app market data, including data scientists, engineers and sales.

Priori's data is sourced from more than six billion unique user devices in 252 territories and Priori's proprietary core machine learning data intelligence software provides intelligence across keywords, apps, markets, usage and audience.

Priori's active customers include blue-chip multinational organisations.

Based on unaudited management information, in the financial year ended 31 December 2017 Priori had revenues of €1,056,000 (on a cash-receipt basis) and recorded EBITDA losses of €410,000 (on a net cash-receipt/cash-expense basis). On completion of the proposed Acquisition, following the conversion of existing Priori loan notes, Priori is expected to have unaudited target net assets of approximately €39,000.

Background to, and reasons for, the Acquisition and the Proposed Fundraise

The Board of appScatter believes the Acquisition will allow the enlarged group to provide significantly enhanced, market leading, data-led app insights. The Directors believe that these insights, when combined with Priori's data intelligence software, will enhance the Group's ability to meet the increasing data demands of existing and prospective customers.

The combined range of the appScatter and Priori datasets will be available to the Company's targeted customers such as brands, app publishers, advertising agencies and mobile networks to conduct more targeted demographic campaigns.

The Proposed Fundraise will be required to enable the Company to fund the Cash Consideration and to provide additional working capital resources for the enlarged group.

The Acquisition

The Company has entered into a conditional sale and purchase agreement to acquire Priori, pursuant to which appScatter has agreed to purchase 100 per cent. of the issued share capital of Priori.

The total consideration for the Acquisition is £13.5 million, to be satisfied by the payment of the Cash Consideration and the issue of the Consideration Shares.

A minimum of 16.9 per cent. of the Consideration Shares, which will be issued to Priori management, will be subject to a lock-in agreement for an initial period of 12 months and an orderly market arrangement for a further period of 12 months following the expiry of the initial lock-in period. The remaining Consideration Shares not subject to an initial lock-in period shall be subject to an orderly market arrangement for a period of 12 months.

The Acquisition Agreement

Pursuant to an acquisition agreement dated 5 April 2018 (the "Acquisition Agreement") between (1) the Company and (2) Quixote Holdings UG, Lakestar I LP, Martin Rajcan, Priori Trust UG, Seedcamp III LP and Calceus GmbH (together the "Sellers"), the Company has agreed to acquire all the issued and to be issued shares in Priori Data GmbH. The consideration under the Acquisition Agreement is £13.5 million to be satisfied on completion through the payment of the Cash Consideration and the issue and allotment of the Consideration Shares.

Completion of the Acquisition is conditional on the despatch by the Company to its Shareholders of a circular in substantively agreed form and the passing, at a duly convened general meeting, of the Resolutions in the form set out in the circular.

The parties have agreed that no circular will be despatched to appScatter Shareholders until such time as legally-binding commitments under the Proposed Fundraise are received and that, therefore, the necessary £15 million of funding to effect the Acquisition and to provide additional working capital resources for the enlarged group are in place.

The parties have agreed a long stop date for completion of the Acquisition of 15 May 2018.

Under the terms of the Acquisition Agreement, the Sellers have agreed to indemnify the Company for:

(i) all claims, liabilities, costs and reasonable expenses arising in connection with any legal dispute regarding the usage of certain images on Priori's website in the past;

(ii) all claims, liabilities, costs and reasonable expenses arising in connection from any violations of the laws with respect to (i) bogus self-employment and (ii) minimum wage laws by Priori (in each case, including but not limited to social security contributions, taxes, fines and penalties and external costs with respect to such matter);

(iii) all claims, liabilities, costs and reasonable expenses arising in connection from any violations of the Protection Against Unfair Dismissal Act by the Priori in respect of its employees;

(iv) all claims, liabilities, costs and reasonable expenses arising in connection with any convertible loan agreements made between the Priori and certain lenders in 2013 and 2016; and

(v) all claims, liabilities, costs and reasonable expenses arising in connection with any claim made by any employee of Priori (whether current or former) or other person with respect to the Intellectual Property Rights or with respect Priori's proprietary software.

Each of the Sellers are giving warranties in favour of the Company as to title only. The management Sellers are giving a suite of warranties in favour of the Company that are usual for this type of transaction.

The management Sellers have agreed not to carry on or be engaged, concerned or interested (whether directly or indirectly) with the business of any other app analytics platform for a period of 2 years following completion of the Acquisition.

Current Trading and Prospects

2017 was a prominent year for the Company, with appScatter reporting maiden revenues in the first half of 2017, being admitted to AIM in September 2017 and launching the appScatter platform in November 2017.

As at 23 March 2018, the Company had 14,954 registered users, of which 1,059 were licensed users of the appScatter platform (comprising free users, trial users and paying users).

The Company was pleased to announce its first major partnership agreement, with Airpush, Inc, a leading mobile advertising network, in March 2018. The Company currently expects the marketing campaign which is to accompany this partnership, and is designed to promote the appScatter platform to Airpush users, to commence in Q2 2018.

The Board reports that trading for the year to 31 December 2017 remains in line with market expectations and the Company's current expectations, based on unaudited unreviewed financials, are that the Company will report 2017 revenues of approximately £1.9 million and a loss before interest and tax of approximately £6.5 million. 2018 has started well and trading in the year to date is in line with management expectations. The Company has a number of potential partnerships under discussion and progressing and, should any of these potential partnerships be concluded, the Board would expect these partnerships to be accretive to revenues in future periods.

The Company expects to announce its audited full year results to 31 December 2017 in Q2 2018.