1 December 2009
Network Group Holdings plc
("NGH" or the "Group")
Disposals
As a consequence of the challenging trading conditions experienced in the first
half of 2009, the Group has undertaken a review of all its trading operations
and their potential future contributions to the business. As a result of this
review, the Group has decided to sell its holdings in two subsidiaries, and is
in negotiations to sell a third.
Two of the businesses being sold, Executive Network Legal Limited ("ENL") and
Total Employment Limited ("TEL"), in which the Group has holdings of 51 per
cent. and 87.5 per cent. respectively, have been sold to Jonathon D Smith, a
director and shareholder of the NGH, for a total consideration of £2. The
Group's results for the year to 30 November 2008 included turnover of £
1,235,000 and losses of £102,000 in respect of these two companies, and these
losses have increased during 2009. Simultaneously with the disposal of ENL and
TEL, a subsidiary of Pertemps Investment Limited ("PIL"), a major shareholder
in NGH and a member of the NGH Concert Party, has agreed to acquire at face
value the debt due from ENL and TEL to the Group, resulting in a cash inflow to
the Group of approximately £600,000.
The Group is in negotiations to sell the third subsidiary to its managing
director for approximately £35,000.
The disposal of ENL and TEL constitutes a related party transaction for the
purposes of Rule 13 of the AIM Rules for Companies. The directors of NGH, other
than Jonathon D Smith, have consulted with Dowgate Capital Advisers Limited,
being the Group's nominated adviser, and consider the terms of the disposals to
be fair and reasonable in so far as the Group's shareholders are concerned.
For further information please contact:
Network Group Holdings plc 01676 525 000
Paul Davis / Spencer Jones
www.networkgroupholdings.co.uk
Nominated Adviser 020 7448 4400
Dowgate Capital Advisers Limited
William Vandyk / Antony Legge