Re: Proposed Demerger and Subscription

8 January 2013

IPSO VENTURES PLC ("IPSO" or "the Company")

Further re Proposed Demerger and Subscription

On 28 December 2012, the Board announced that the Company had entered into a conditional agreement and posted a circular to Shareholders ("the Circular") in connection with the proposed subscription by an Investor Group for £360,000 of new Ordinary Shares and also to demerge IPSO Management (including the IPSO Investment Portfolio) from the Company (together "the Proposals").

Earlier today the Company announced that Buckton Homes Limited ("Buckton Homes") a shareholder owning approximately 4.3 per cent. of the Ordinary Shares, had sent a letter to Shareholders raising certain concerns about the Proposals and urging Shareholders to vote against the Proposals ("the Buckton Homes Letter").

THE BOARD CONTINUE TO RECOMMEND THAT SHAREHOLDERS VOTE IN FAVOUR OF THE PROPOSALS AS THEY BELIEVE THAT THE KEY ASSERTIONS CONTAINED IN THE BUCKTON HOMES LETTER ARE WRONG.

The Buckton Homes Letter makes a number of assertions including, inter alia, that:

1. no financial information relating to IPSO Management is set out in the Circular;

2. no values are ascribed to any of the investments within the IPSO Investment Portfolio;

3. the Circular fails to advise Shareholders of the liabilities of IPSO Management which will remain after the Demerger, in particular that the Circular fails to draw the attention of Shareholders the fact that there is or will remain after the Demerger debt owing from IPSO Management to IPSO Ventures which, as at 30th April 2012, amounted to £5,693,628 ("the £5 million Debt");

4. the Buckton Homes Letter goes on to assert that should the £5 million Debt be cancelled, that could give rise to a potential tax liability for IPSO Management; and

5. the true value of the shares in IPSO Management will be zero.

The Company's response to the Buckton Homes Letter is as follows:

1. In relation to the first two points, the Board points out that there is no requirement for such financial information to be included in the Circular;

2. information on the IPSO Investment Portfolio was included on pages 3 and 4 of the report and accounts of the Company for the financial year ended 30th April 2012 ("the Report and Accounts") which were posted to Shareholders at the same time and in the same envelope as the Circular;

3. the £5 million Debt has been fully provided for in the Company's accounts for the last two financial years;

4. the Board has received preliminary tax advice that there would be no adverse tax effect on IPSO Management or IPSO Ventures were the £5 million Debt to be waived;

5. the Board intends to waive the £5 million Debt before the Proposals complete, pending receipt of written tax advice which it expects to receive shortly; and

6. there are no other amounts owed by IPSO Management or the IPSO Investment Portfolio to the Company.

The Board firmly believes that the assertion by Buckton Homes that the true value of the shares in IPSO Management will be zero, is totally incorrect. Following Completion of the Proposals and the waiver of the £5 million debt referred to above, IPSO Management will own the IPSO Investment Portfolio (which had a book value of circa £1.5 million as at 30th April 2012) and have no debt.

The Board would also draw Shareholders attention to the following paragraph that is contained in page 16 of the Circular in the paragraph entitled "Risk Factors": "Should the Resolutions not be passed at the General Meeting and/or the Court Order and the Proposals not be implemented, the Company would have insufficient working capital available to it to continue to trade and would need to be refinanced immediately to enable it to continue trading. There can be no assurance that such refinancing would be forthcoming and in these circumstances the Board will be forced to take steps to protect the interests of creditors which may include placing the Company into administration or receivership."

The Board confirms that certain of the Directors have met with Buckton Homes on a number of occasions, before the posting of the Circular and the Buckton Homes Letter to Shareholders, to discuss the Proposals. Following these meetings, Buckton Homes has made no viable alternative proposals to the Board on how to prevent the Company going into administration or receivership.

The General Meeting is being held at the offices of DMH Stallard LLP, 6 New Street Square, New Fetter Lane, London EC4A 3BF at 11.00 a.m. on 14 January 2013. The Company has received irrevocable undertakings from Shareholders (including the Board) totalling 50.9 per cent. of the Company's issued share capital, to vote in favour of the Resolutions.

THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE IN FAVOUR OF THE RESOLUTIONS AT THE GENERAL MEETING. NOT TO DO SO WILL, UNLESS A VIABLE ALTERNATIVE TO THE PROPOSALS CAN BE SECURED IN THE SHORT TERM, ALMOST CERTAINLY LEAD TO THE COMPANY GOING INTO ADMINISTRATION OR RECEIVERSHIP AND IPSO ORDINARY SHARES BECOMING WORTHLESS AS THE COMPANY'S CURRENT LIABILITIES EXCEED ITS CURRENT ASSETS.

All definitions used in this announcement have the same meaning as the Company's announcement of 28 December 2012, unless otherwise defined herein.

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