Mecom offentliggør frasalg af tyske aktiviteter

13 January 2009

Mecom Group plc

Mecom sells its German operations for €152.0 million

The Board of Mecom Group plc ("Mecom" or the "Group") announces that it has entered into an agreement to dispose all of its German operations (the "Business" or "Mecom Germany") to M. DuMont Schauberg for a cash consideration of €152.0 million (approximately £135 million). The disposal is expected to complete in the first quarter of 2009.

Disposal of the Business

Under the terms of the Sale and Purchase Agreement, Mecom has agreed to sell the Business for a cash consideration of €152.0 million (approximately £135.0 million) on a cash and debt free basis, payable at completion, subject to adjustments for normalised level of working capital and net financial assets/liabilities. The disposal is conditional upon shareholder approval, in relation to which a circular will be sent to the shareholders in due course, as well as German antitrust clearance.

Mecom Germany operates in Germany under the Berliner Verlag and Hamburger Morgenpost names. The Business publishes Berliner Zeitung, Berliner Kurier and Hamburger Morgenpost titles and operates 10 websites, including Netzeitung.de. Mecom Germany's publications have a daily readership of approximately one million and its online operations attract over 3 million unique users per month. It also operates a printing plant in Berlin, which prints publications for Mecom Germany and third parties, as well as a customer call centre. As at 31 December 2007, the Business had gross assets of €377.3 million (approximately £335.0 million) and net assets of €311.5 million (approximately £276.0 million), including goodwill and acquired intangible assets of approximately €284.9 million (€252.6 million). In the financial year ended 31 December 2007, it made a pro forma contribution of €17.6 million (approximately £16.0 million) to the Group's overall operating profit.

Use of proceeds

This disposal is part of the Group's strategy to strengthen its balance sheet and ensure Mecom, with its remaining Dutch, Danish, Norwegian and Polish businesses, is in a stronger position to operate successfully in the current market conditions. As a result, the proceeds from this disposal will be used to reduce significantly the Group borrowings.

Commenting on the disposal, David Montgomery, Executive Chairman of Mecom, said:

"We are pleased with the outcome of our negotiations and feel we have delivered value to shareholders by strengthening Mecom's balance sheet in the current market. The Board is confident that the strategy of reducing debt and focusing on our core assets greatly improves the position and prospects of the Group. We are pleased that we have left the German business in a fitter state since our investment. We would like to thank its management and wish all the staff well in their future endeavours. Mecom will continue to concentrate its efforts on the leading market positions it enjoys in its four other territories."

General Meeting

A circular containing a notice convening a general meeting will be posted to shareholders in due course.

END

Enquiries:

Mecom Group plc +44 20 7925 7200
David Montgomery, Executive Chairman
Keith Allen, Chief Operating Officer

N. M. Rothschild & Sons Limited (financial advisor to Mecom) +44 20 7280 5000
Warner Mandel
Frank Herzog

JPMorgan Cazenove +44 20 7588 2828
Laurence Hollingworth
Andrew Hodgkin

M:Communications +44 20 7153 1530
Nick Miles
Eleanor Williamson

N. M. Rothschild & Sons Limited, which is authorised and regulated by the Financial Services Authority in the United Kingdom, is acting for Mecom Group plc and no one else in relation to matters described in this announcement and will not be responsible to anyone other than Mecom Group plc for providing the protections afforded to clients of N. M. Rothschild & Sons Limited nor for providing advice in relation to the matters described in this announcement.

Note:
£:€ 1.1274