Recommended cash acquisition of IMD plc (9746B)

TIDMIMD

RNS Number : 9746B

Independent Media Distribution PLC

28 February 2011

For immediate release

________________________________________________________________________ __________

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION IN WHOLE OR IN PART IN OR INTO OR FROM ANY JURISDICTION WHERE IT IS UNLAWFUL TO DO SO

28 February 2011

Recommended cash acquisition

Independent Media Distribution plc

Lausanne Acquisitions Limited, a company controlled by investment partnerships advised by Vitruvian Partners LLP

(to be implemented by a scheme of arrangement under Part 26 of the Companies Act 2006)

Summary

-- The Independent Directors of IMD and the board of Bidco are pleased to announce that they have reached agreement on the terms of a recommended acquisition of the entire issued and to be issued share capital of IMD by Bidco. Bidco is a newly incorporated company which has been formed for the purposes of making the Acquisition at the direction of, and is controlled, by the Vitruvian Fund advised by Vitruvian Partners.

-- Scheme Shareholders (other than Simon Cox in relation to the Cox Shares) will be entitled to receive 91 pence in cash for each Scheme Share.

-- The Acquisition values the entire issued and to be issued share capital of IMD at approximately GBP33.9 million.

-- The price of 91 pence per Scheme Share represents a premium of:

-- 13.8 per cent. to the Closing Price of 80 pence per IMD Share on 25 February 2011, the last business day prior to the date of this announcement;

-- 23.0 per cent. to the average Closing Price of 74 pence per IMD Share for the six months prior to the date of this announcement; and

-- 33.8 per cent. to the average Closing Price of 68 pence per IMD Share for the twelve months prior to the date of this announcement.

-- IMD is a provider of media logistics solutions, operating in the UK, Ireland, Germany, Switzerland, Austria and France. The Company provides content distribution and advertising data services to creative and media agencies, post production houses, broadcasters and online publishers.

-- Vitruvian Partners is an independent private equity firm that specialises in middle-market buyouts, growth buyouts and growth capital investments in the United Kingdom and elsewhere in Northern Europe. Vitruvian Partners acts as discretionary manager to the Vitruvian Fund which comprises total commitments of EUR925 million.

-- It is intended that the Acquisition will be implemented by means of a Court sanctioned scheme of arrangement under Part 26 of the Companies Act 2006.

-- The implementation of the Scheme will be subject to a number of conditions including the Conditions and the passing of a resolution to approve the Scheme by a simple majority in number of the Independent Scheme Shareholders present, entitled to vote and voting at the Court Meeting (or at an adjournment thereof), either in person or by proxy, representing not less than 75 per cent. in value of Scheme Shares voted at the Court Meeting (or at any adjournment thereof).

-- Upon the Scheme becoming effective, it will be binding on all Scheme Shareholders, irrespective of whether they attend or voted at the Court Meeting or the General Meeting (and if they attended and voted, whether or not they voted in favour).

-- The Bidco Group has entered into arrangements with the Executive Managers in relation to their equity involvement in the Bidco Group. Under these arrangements the Executive Managers are expected to invest GBP387,964 in the Bidco Group either from their own resources directly or indirectly held and/or utilising some or all of the cash consideration that each will be entitled to receive upon implementation of the Scheme. Simon Cox will also be investing by means of allotment to him of Bidco Ordinary Shares as consideration for the cancellation of the Cox Shares.

-- IMD has entered into the Inducement Fee Agreement with Vitruvian Partners (on behalf of Bidco) under which IMD has given certain non-solicitation undertakings and agreed, under certain circumstances, to pay an inducement fee to Vitruvian Partners of one per cent. of the value of the Acquisition (plus any VAT only to the extent both applicable and recoverable by IMD). Further details of the Inducement Fee Agreement are provided below.

-- IMD and Bidco have entered into the Implementation Agreement which governs their relationship during the period until the Acquisition becomes effective, lapses or is withdrawn or the agreement is otherwise terminated. The parties have agreed, amongst other things, to co-operate with regard to the process of implementing the Acquisition. The Implementation Agreement also contains provisions which grant Bidco the right to match the financial value of competing offers from third parties. Further details of the Implementation Agreement are provided below.

-- The Independent Directors, who have been so advised by Oakley Capital, consider the terms of the Acquisition to be fair and reasonable. In providing its advice, Oakley Capital has taken into account the commercial assessments of the Independent Directors. Accordingly, the Independent Directors intend to recommend to IMD Shareholders to vote in favour of the Acquisition at the Court Meeting and the General Meeting.

-- Bidco has received irrevocable undertakings from the Independent Directors (and certain of their related trusts or associated companies) to: (i) vote in favour of the Acquisition at the Court Meeting; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more, in respect of, in aggregate, 13,599,124 IMD Shares representing approximately 39.7 per cent. of the entire issued share capital of IMD.

-- Bidco has also received irrevocable undertakings from certain of the Executive Managers (and certain of their related trusts or associated companies) to: (i) consent to the Acquisition and undertake to the Court to be bound by the Scheme; and (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting (other than the resolution approving the Management Arrangements) to the extent that they hold shares at the time of the General Meeting; and (iii) accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more in respect of, in aggregate, 320,630 IMD Shares, representing approximately 0.9 per cent. of the entire issued share capital of IMD.

-- Bidco has received from Independent IMD Shareholders (not being the Independent Directors) irrevocable undertakings to: (i) vote in favour of the Acquisition at the Court Meeting; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more, in respect of, in aggregate, 5,684,800 IMD Shares representing approximately 16.6 per cent. of the entire issued share capital of IMD.

-- Further details of these irrevocable undertakings are set out in Appendix III to this announcement.

-- In aggregate, therefore, Bidco has received irrevocable undertakings to vote at the General Meeting in favour of the resolutions required to implement the Scheme, the Capital Reduction and amendments to the articles of association of IMD to be proposed at the General Meeting, in respect of 19,604,554 IMD Shares, representing approximately, in aggregate, 57.2 per cent. of the existing issued share capital of IMD.

-- It is expected that the Scheme Document will be posted to Shareholders and, for information only, to participants in the IMD Share Schemes by 25 March 2011 and will become effective by the end of May 2011 subject to the satisfaction (or, if applicable, waiver) of all relevant conditions (including the Conditions).

DC Advisory Partners is acting as financial adviser to Bidco in connection with the Acquisition. Oakley Capital is acting as financial adviser to IMD in connection with the Acquisition.

Commenting on the Acquisition, David Haynes, an Independent Director of IMD said:

"The Acquisition represents an opportunity for IMD Shareholders to realise their investment in IMD, in cash, at a premium to the current IMD Share price. The Independent Directors are pleased to recommend the Acquisition which we believe, in the context of the risks and opportunities faced by the Company, represents an attractive valuation for IMD Shareholders."

Commenting on the Acquisition, Simon Cox, Chief Executive Officer of IMD said:

"This important step in IMD's life means that we can continue to create more value in our chosen field of media logistics whilst adopting new strategies to do this that will be complemented by the financial flexibility and support of Vitruvian Partners."

Commenting on the Acquisition, Toby Wyles, Managing Partner of Vitruvian Partners said:

"We are delighted to be backing IMD as it looks to build on its strong position in the content distribution and advertising data services markets. We look forward to working with IMD's highly respected management team and providing the necessary capital for IMD to evolve and expand in this rapidly developing sector."

Enquiries

 
 Bidco                                     Tel: + 44 (0)20 7518 
                                            2800 
 Toby Wyles / Ben Johnson 
 
 DC Advisory Partners, financial adviser   Tel: + 44 (0) 20 7856 
  to Bidco                                  0999 
 Richard Madden / David Sanders 
 
 IMD                                       Tel: +44 (0) 7765 258 
                                            995 
 David Haynes 
 
 Oakley Capital, financial adviser         Tel: + 44 (0) 20 7766 
  to IMD                                    6900 
 Chris Godsmark / Daniel Havercroft

This summary should be read in conjunction with the accompanying full text of this announcement which sets out further details of the Acquisition and which forms an integral part of this announcement. Appendix I to this announcement contains the conditions to, and certain further terms of, the Acquisition. Appendix II contains further details of the sources of information and bases of calculations set out in this announcement. Appendix III contains further details of the irrevocable undertakings and Appendix IV contains definitions of certain expressions used in this summary and in this announcement.

Important information

The directors of Bidco and the investment committee of Vitruvian Partners (all of whose names will be set out in the Scheme Document) accept responsibility for the information contained in this announcement save for the information for which the investment committee of Vitruvian Partners alone accepts responsibility, as set out below and the information for which the directors of IMD or the Independent Directors accept responsibility, as set out below. To the best of the knowledge and belief of the directors of Bidco and the investment committee of Vitruvian Partners (who have taken all reasonable care to ensure that such is the case), such information for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

The investment committee of Vitruvian Partners accepts responsibility for the information relating to Vitruvian Partners and the Vitruvian Funds. To the best of the knowledge and belief of the investment committee of Vitruvian Partners (who have taken all reasonable care to ensure that such is the case), such information for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

The directors of IMD (all of whose names will be set out in the Scheme Document) accept responsibility for the information contained in this announcement relating to IMD, the IMD Group and themselves and their immediate families, related trusts and connected persons. To the best of the knowledge and belief of the directors of IMD (who have taken all reasonable care to ensure that such is the case), such information for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

The Independent Directors accept responsibility for their recommendation of the Acquisition contained in the announcement. To the best of the knowledge and belief of the Independent Directors (who have taken all reasonable care to ensure that such is the case), such information for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

DC Advisory Partners which is authorised and regulated by the Financial Services Authority for investment business activities, is acting for Bidco as financial adviser in relation to the Acquisition and is not acting for any other person in relation to the Acquisition. DC Advisory Partners will not be responsible to anyone other than Bidco for providing the protections afforded to its clients or for providing advice in relation to the contents of this announcement or any offer or arrangements referred to herein.

Oakley Capital which is authorised and regulated by the Financial Services Authority is acting exclusively for IMD and no-one else as financial adviser in relation to the Acquisition. Oakley Capital will not be responsible to anyone other than IMD for providing the protections afforded to its clients or for providing advice in relation to the contents of this announcement or any offer or arrangements referred to herein.

Overseas Shareholders

The availability of the Acquisition or the distribution of this announcement to persons who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions in which they are located. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable requirements. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

Notice to US investors in IMD: The Acquisition relates to the shares of a UK company and is proposed to be made by means of a scheme of arrangement provided for under the laws of England and Wales. The Acquisition is subject to the disclosure requirements and practices applicable in the United Kingdom to schemes of arrangement, which differ from the disclosure and other requirements of US securities laws. Financial information included in the relevant documentation will have been prepared in accordance with accounting standards applicable in the United Kingdom (or other appropriate jurisdictions) that may not be comparable to the financial statements of US companies.

The Acquisition will not be made available, directly or indirectly, in or into the United States, Canada, Australia, South Africa or Japan and no person may vote in favour of the Acquisition by any such use, means, instrumentality or facility or form within the United States, Canada, Australia, South Africa or Japan or any other such jurisdiction if to do so would constitute a violation of the relevant laws of such jurisdiction. Accordingly, copies of this announcement, the Scheme Document and the Forms of Proxy are not being, will not be and must not be mailed or otherwise forwarded, distributed or sent in, into or from the United States, Canada, Australia, South Africa or Japan or any other such jurisdiction if to do so would constitute a violation of the relevant laws of such jurisdiction and persons receiving this press announcement, the Scheme Document and the Forms of Proxy (including without limitation custodians, nominees and trustees) must not mail, forward, distribute or send them in, into from the United States, Canada, Australia, South Africa or Japan or any other such jurisdiction if to do so would constitute a violation of the relevant laws of such jurisdiction.

This announcement is for information purposes only and is not intended to and does not constitute or form part of an offer to sell or invitation to purchase any securities or the solicitation of any vote for approval in any jurisdiction, nor shall there be any sale, issue or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law. The Scheme will be put to IMD Shareholders solely through the Scheme Document, and the Forms of Proxy, which will together contain the full terms and conditions of the Acquisition, including details of how to vote in favour of the Acquisition. Any response in relation to the Acquisition should be made only on the basis of the information contained in the Scheme Documents, the Forms of Proxy or any other document by which the Acquisition is made.

Cautionary note regarding forward looking statements

This announcement may contain certain forward-looking statements with respect to the financial condition, results of operations and business of IMD, the Acquisition and certain plans and objectives of the boards of IMD and Bidco with respect thereto. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use (without limitation) words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could", or other words of similar meaning. These statements are based on assumptions and assessments made by the boards of IMD and/or Bidco in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe appropriate. By their nature, forward-looking statements involve risk and uncertainty, because they relate to events and depend on circumstances that will occur in the future and the factors described in the context of such forward-looking statements in this document could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements. Although IMD and Bidco believe that the expectations reflected in such forward-looking statements are reasonable, IMD and Bidco can give no assurance that such expectations will prove to have been correct and IMD and Bidco therefore caution you not to place undue reliance on these forward-looking statements which speak only as at the date of this announcement.

Disclosure requirements

Under Rule 8.3(a) of the City Code, any person who is "interested" (directly or indirectly) in 1 per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an "Opening Position Disclosure" following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An "Opening Position Disclosure" must contain details of the person's interests and short positions in, and rights to subscribe for, any "relevant securities" of each of (i) the offeree company and (ii) any paper offeror(s). An "Opening Position Disclosure" by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th business day following the announcement in

which any paper offeror is first identified. Relevant persons who deal in the "relevant securities" of the offeree company or of a paper offeror prior to the deadline for making an "Opening Position Disclosure" must instead make a "Dealing Disclosure".

Under Rule 8.3(b) of the City Code, any person who is, or becomes, "interested" in 1 per cent. or more of any class of "relevant securities" of the offeree company or of any paper offeror must make a "Dealing Disclosure" if the person deals in any "relevant securities" of the offeree company or of any paper offeror. A "Dealing Disclosure" must contain details of the "dealing" concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A "Dealing Disclosure" by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an "interest" in "relevant securities" of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

"Opening Position Disclosures" must also be made by the offeree company and by any offeror and "Dealing Disclosures" must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rule 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities "Opening Position Disclosures" and "Dealing Disclosures" must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you require to make an "Opening Position Disclosure" or a "Dealing Disclosure", you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Terms in quotation marks are defined in the City Code, which can also be found on the Panel's website at www.thetakeoverpanel.org.uk.

Market Purchases

In accordance with normal UK market practice, Bidco or its nominees or brokers (acting as agents) may from time to time make certain purchases of, or arrangements to purchase, IMD Shares outside the United States, other than pursuant to the Scheme, prior to the Effective Date. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Any information about such purchases will be disclosed as required in the UK.

Publication on website

A copy of this announcement will be available free of charge, subject to certain restrictions relating to persons resident in restricted jurisdictions, on IMD's website at www.imdplc.com by no later than 12.00 p.m. on 1 March 2011.

A IMD Shareholder, person with information rights or other person to whom this document is sent electronically or who is sent a website notification may request a copy of the information incorporated into this document in hard copy form. A hard copy of this information will not be sent to any such person unless requested. Hard copies of such information may be obtained on request by writing to Chris Godsmark / Daniel Havercroft of Oakley Capital, 3 Cadogan Gate, London, SW1X 0AS, or by calling +44 (0)20 7766 6900 and a hard copy will be sent to you as soon as possible and in any event within two business days of your request.

Rule 2.10 Disclosure

In accordance with Rule 2.10 of the City Code, the Company confirms that it has 34,289,275 IMD Shares of 10 pence each in issue and admitted to trading on AIM under the ISIN code GB0031308850.

For immediate release

________________________________________________________________________ __________

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION IN WHOLE OR IN PART IN OR INTO OR FROM ANY JURISDICTION WHERE IT IS UNLAWFUL TO DO SO

28 February 2011

Recommended cash acquisition

Independent Media Distribution plc

Lausanne Acquisitions Limited, a company controlled by investment partnerships advised by Vitruvian Partners LLP

(to be implemented by a scheme of arrangement under Part 26 of the Companies Act 2006)

1. Introduction

The Independent Directors and the board of Bidco are pleased to announce that they have reached agreement on the terms of a recommended acquisition of the entire issued and to be issued share capital of IMD by Bidco. It is intended that the Acquisition will be effected by means of a scheme of arrangement under Part 26 of the Companies Act 2006.

Bidco is a newly incorporated company which has been formed for the purposes of making the Acquisition, and is controlled by, the Vitruvian Fund advised by Vitruvian Partners.

In view of their arrangements with Bidco as described in paragraph 4 below, those directors of IMD who are Executive Managers are each regarded as having a conflict of interest in relation to the Acquisition. A committee of the board of IMD comprising the Independent Directors, has therefore been established for the purposes of progressing the Acquisition, considering all matters relating to the Acquisition and making the recommendations to IMD Shareholders in relation to the Acquisition.

2. The Acquisition

Under the terms of the Scheme, which will be subject to the Conditions and certain further terms set out in Appendix I to this announcement and to be set out in the Scheme Document, Scheme Shareholders (other than in relation to the Cox Shares) will be entitled to receive:

for each Scheme Share 91 pence in cash

The Acquisition values the entire issued and to be issued share capital of IMD at approximately GBP33.9 million.

The price of 91 pence per Scheme Share represents a premium of approximately:

-- 13.8 per cent. to the Closing Price of 80 pence per IMD Share on 25 February 2011, the last business day prior to the date of this announcement;

-- 23.0 per cent. to the average Closing Price of 74 pence per IMD Share for the six months prior to the date of this announcement; and

-- 33.8 per cent. to the average Closing Price of 68 pence per IMD Share for the twelve months prior to the date of this announcement.

The Scheme Document, containing further details of the Acquisition (including notices of a Court Meeting and a General Meeting) together with the Forms of Proxy, will be posted to IMD Shareholders and, for information only to participants in the IMD Share Schemes, within 28 days of this announcement, unless otherwise agreed with the Panel. Resolutions to, amongst other things, approve the Scheme and the Capital Reduction will be put to IMD Shareholders at the Court Meeting and the General Meeting, respectively. It is expected that the Court Meeting and the General Meeting to approve the Acquisition will be held on or about 19 April 2011. Subject to shareholder approval and the satisfaction (or, if applicable, waiver) of all relevant conditions (including the Conditions) it is expected that the Scheme will become effective by the end of May 2011.

Details of how the Cox Shares will be treated pursuant to the Scheme are set out at paragraph 4 below.

Bidco reserves the right to elect to implement the acquisition of IMD by way of a takeover offer. In such event, the Acquisition will be implemented on the same terms (subject to appropriate amendments), so far as applicable, as those which would apply to the Scheme except that the Acquisition may exclude IMD Shareholders in certain overseas jurisdictions.

Bidco has undertaken to consent to the Scheme and will undertake to the Court to be bound by the terms of the Scheme insofar as it relates to Bidco, including as to the discharge of the consideration for the Acquisition.

3. Recommendation

The Independent Directors, who have been so advised by Oakley Capital, consider the terms of the Acquisition to be fair and reasonable. In providing its advice to the Independent Directors, Oakley Capital has taken into account the commercial assessments of the Independent Directors.

Accordingly, the Independent Directors intend to recommend that IMD Shareholders vote in favour of the resolutions to be proposed at the Court Meeting and the General Meeting.

4. Arrangements between Bidco and the Executive Managers

The Bidco Directors believe that the ongoing participation in the continued growth of IMD by the Executive Managers is very important, due to their knowledge of the Company and its markets and their existing relationships with customers and suppliers. Therefore the Executive Managers have reached agreement with Bidco in relation to the Management Arrangements under which, inter alia, it is anticipated Simon Cox will invest GBP200,000 (being funded from approximately 21.5 per cent. of his proceeds from the Acquisition) in Bidco Ordinary Shares and Philip McDanell and/or an investment vehicle of which he is the beneficiary will invest GBP183,064 (being funded from approximately 83.4 per cent. of his proceeds from the Acquisition) in each case in shares and loan notes in other companies in the Bidco Group, which together will give them an economic entitlement to approximately 17.4 per cent. of the equity in Holdco (indirectly as they will both invest in the equity via Manco) and approximately GBP369,442 of nominal value in loan notes in Midco.

In addition, the rest of the Executive Managers will invest approximately GBP4,900 (being funded from their own resources) in shares of Manco, which together will give them an economic entitlement to approximately 6.2 per cent. of the equity in Holdco (indirectly as they will invest in the equity via Manco).

As part of the Acquisition, the consideration to which Simon Cox will become entitled under the Scheme upon its implementation in respect of the Cox Shares will be satisfied by the allotment to him of Bidco Ordinary Shares. For that reason, the Cox Shares will be reclassified as A Ordinary Shares pursuant to the Scheme in order to distinguish them from Scheme Shares in respect of which the cash consideration described above will be paid.

Such Bidco Ordinary Shares will be exchanged, indirectly, for equity in Holdco and loan notes in Midco. Holdco and Midco are other companies in the Bidco Group. Further details of Bidco's holding company structure will be set out in the Scheme Document.

The Executive Managers will remain in place to operate IMD once the Scheme becomes effective on the basis of their current service contracts, subject to certain agreed amendments.

The Acquisition is subject to, among other things, the approval by the Independent IMD Shareholders of the Management Arrangements.

Bidco considers the Management Arrangements to be critical to the success of the Acquisition and therefore if the Independent IMD Shareholders do not approve these arrangements at the General Meeting, Bidco may (at its absolute discretion) seek to invoke Condition 1(iii) of Part A of Appendix I to this announcement, which would result in the Acquisition being withdrawn.

None of the Executive Managers shall be entitled to attend, speak or vote at the Court Meeting.

Oakley Capital considers the terms of the arrangements with the Executive Managers to be fair and reasonable.

Further details of the Management Arrangements will be set out in the Scheme Document.

5. Irrevocable undertakings

Bidco has received irrevocable undertakings from the Independent Directors (and certain of their related trusts and associated companies) to: (i) vote in favour of the Acquisition at the Court Meeting; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more, in respect of, in aggregate, 13,599,124 IMD Shares representing approximately 39.7 per cent. of the entire issued share capital of IMD.

Bidco has also received irrevocable undertakings from certain of the Executive Managers (and certain of their related trusts and associated companies) to: (i) consent to the Acquisition and undertake to the Court to be bound by the Scheme; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting (other than the resolution approving the Management Arrangements) to the extent that they hold shares at the time of the General Meeting; and (iii) accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more in respect of, in aggregate, 320,630 IMD Shares, representing approximately 0.9 per cent. of the entire issued share capital of IMD.

Bidco has received from Independent IMD Shareholders (not being the Independent Directors) irrevocable undertakings to: (i) vote in favour of the Acquisition at the Court Meeting; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) to accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more, in respect of, in aggregate, 5,684,800 IMD Shares representing approximately 16.6 per cent. of the entire issued share capital of IMD.

Further details of these irrevocable undertakings are set out in Appendix III to this announcement.

In aggregate, therefore, Bidco has received irrevocable undertakings to vote at the General Meeting in favour of the resolutions required to implement the Scheme, the Capital Reduction and amendments to the articles of association of IMD to be proposed at the General Meeting, in respect of 19,604,554 IMD Shares, representing approximately, in aggregate, 57.2 per cent. of the existing issued share capital of IMD.

6. Background to and reasons for the Acquisition

Vitruvian Partners believes that the Executive Managers have overseen a period of growth in a challenging market environment and intends to support them in realising their plans for the Company.

In particular, the Executive Managers have identified a number of attractive development opportunities which Bidco intends to support to reinforce IMD's positions in the markets in which it operates and to enhance its prospects for future growth.

Given the medium term investment horizon required to pursue this strategy, Vitruvian Partners believes that the next stage of IMD's development would best be achieved under private ownership.

7. Background to and reasons for recommending the Acquisition

Since its formation in 1996, IMD has been developing a range of products and solutions to service the advertising, radio and television markets, including content distribution and data administration for the UK and continental Europe. During this period, IMD has had to adjust to considerable changes in its target markets and also the competitive landscape in which it operates. Such changes include the decline of radio content distribution and the emergence of online video content distribution.

Over the two years to 31 December 2009 IMD increased its revenues and profits despite the economic climate at the time and uncertainty over advertising spending. This growth has been augmented by the expansion of IMD into Ireland, France and Germany, including the German speaking area of Switzerland.

IMD increased its turnover (year-on-year) by approximately 30 per cent. in the 6 months to 30 June 2010, to GBP4.73 million. However, in the Independent Directors' opinion, the scale of IMD remains small relative to much larger diversified media services companies. As a result, the Independent Directors believe that IMD faces challenges in its aim to play a major role in a global media services market which is undergoing changes through the development of web-based content. These changes have created opportunities, but also uncertainties, for IMD as it seeks to expand further.

In November 2010, IMD received an indicative approach from Vitruvian Partners regarding its interest in making a possible offer for the Company, with the intention of retaining the Executive Managers to run the Company.

During preliminary discussions, Vitruvian Partners demonstrated a high level of interest in the Company and the market in which it operates, including the potential to grow the Company through both acquisitions and organic growth. This convinced the Independent Directors of the merits of allowing Vitruvian Partners to progress this interest and to conduct a limited due diligence exercise in cooperation with the Company. The discussions have resulted in the proposed recommended acquisition of IMD by Bidco at a price of 91 pence in cash for each Scheme Share.

The Acquisition represents an opportunity for Scheme Shareholders to realise the value of their investment in cash and at a premium to the current market value of the Company.

At a price of 91 pence per Scheme Share, the Acquisition represents:

-- an equity value of approximately GBP33.9 million for the entire issued and to be issued share capital of IMD equating to approximately 26.1 times IMD's profit after taxation (but before amortisation of consumer related intangibles) of GBP1.3 million for the year ended 31 December 2009;

-- a premium of 13.8 per cent. to the Closing Price of 80 pence per IMD Share on 25 February 2011, the last business day prior to the date of this announcement;

-- a premium of 23.0 per cent. to the average Closing Price of 74 pence per IMD Share for the six months prior to the date of this announcement; and

-- a premium of 33.8 per cent. to the average Closing Price of 68 pence per IMD Share for the twelve months prior to the date of this announcement.

Based on IMD's reported net cash at 30 June 2010 of GBP1.0 million, the Acquisition represents:

-- an enterprise value of approximately GBP32.9 million, equating to 14.3 times IMD's earnings from operating activities before interest, tax, depreciation and amortisation of GBP2.3 million for the year ended 31 December 2009.

In considering whether to recommend the Acquisition, the Independent Directors have determined that:

-- the Acquisition represents an opportunity for IMD Shareholders to realise their entire investment in IMD, in cash and at a premium, within a relatively short period of time and without the operational risks inherent in IMD executing its business plan; and

-- the Acquisition fairly reflects the Company's future growth prospects.

The Independent Directors also considered that IMD has received no other expressions of interest from potential offerors since the approach from Vitruvian Partners.

8. Information on IMD

Established in 1996, IMD is a provider of media logistics solutions, operating in the UK, Ireland, Germany, Switzerland, Austria and France. The Company provides content distribution and advertising data services to creative and media agencies, post production houses, broadcasters and online publishers.

For the financial year ended 31 December 2009, IMD reported turnover of GBP8.1 million and profit after taxation (but before amortisation of consumer related intangibles) of GBP1.3 million. In the interim six month period ended 30 June 2010, IMD reported turnover of GBP4.7 million and profit after taxation (but before amortisation of consumer related intangibles) of GBP1.0 million. At 30 June 2010, IMD had net cash of GBP1.0 million and net assets of GBP5.2 million.

9. Information on Bidco

Bidco is a private limited company registered in England and Wales and was incorporated in December 2010.

Bidco was formed for the purposes of making the Acquisition at the direction of, and is controlled by, the Vitruvian Fund advised by Vitruvian Partners.

Bidco has not traded since its date of incorporation, nor has it entered into any obligations other than in connection with the Acquisition and the financing of the Acquisition.

The current Directors of Bidco are Vitruvian Directors I Limited, Vitruvian Directors II Limited and Thomas Studd. Toby Wyles and Ben Johnson have been appointed by Vitruvian Directors I Limited and Vitruvian Directors II Limited respectively to act as their representatives in attending board meetings of Bidco.

10. Information on Vitruvian Partners

Vitruvian Partners is an independent private equity firm that specialises in middle-market buyouts, growth buyouts and growth capital investments in the United Kingdom and elsewhere in Northern Europe. Vitruvian Partners investment professionals' experience as principals in the investment industry dates back to 1990 and demonstrates an ability to invest successfully over multiple market cycles throughout a spectrum of industries.

Vitruvian Partners aims to invest in companies across northern Europe including, the United Kingdom, Eire, Germany, the Nordic Region, the Netherlands, Belgium, Switzerland and Austria. Vitruvian Partners focuses on investments in faster moving, less capital intensive industries such as media, information technology, telecoms, financial services, healthcare, business services and leisure.

Vitruvian Partners acts as discretionary manager to the Vitruvian Fund which comprises total commitments of EUR925 million. The fund closed to new commitments in February 2008. Vitruvian Partners' investment focus is on companies operating in 'dynamic situations' where there is an opportunity to build strategic value in such businesses as they go through significant change.

The Vitruvian Fund targets investments of EUR15 million to EUR150 million typically in the sectors referred to above.

11. Financing the Acquisition

DC Advisory Partners has confirmed that it is satisfied that sufficient resources are available to Bidco to satisfy in full the cash consideration payable pursuant to the Acquisition. Further details on the financing of the Acquisition will be set out in the Scheme Document.

12. Effect of the Scheme on the IMD Share Schemes

Appropriate proposals will be made to holders of options/awards under the IMD Share Schemes in due course. Details of these proposals will be set out in the Scheme Document.

13. Directors, management and employees

The board of Bidco has given assurances to the Independent Directors that, following the Scheme becoming effective, the existing employment rights, including pension rights, of all employees of IMD will be fully safeguarded. The board of Bidco has confirmed to the Independent Directors that Bidco's plans for the IMD Group do not involve any immediate change to the continued employment or the terms and conditions of employment of the IMD Group employees nor are there currently any plans to change the principal locations of IMD's business.

Following the successful implementation of the Acquisition, Simon Cox and Philip McDanell will continue as executive directors of the Company.

The Independent Directors have each undertaken to resign from the board of IMD upon the Scheme becoming effective. In connection with his resignation from the board of IMD, David Haynes has entered into a compromise agreement with IMD (which is conditional on the Scheme becoming effective) which provides, amongst other things, for the payment to David Haynes of GBP66,000 and that David Haynes will be entitled to his normal salary and his existing entitlement to a bonus until the Effective Date.

14. Disclosure of interests in IMD of Bidco and persons acting in concert with Bidco

As at 25 February 2011 (the latest practicable date prior to the date of this announcement) and save as set out below and save for the irrevocable undertakings referred to in paragraph 5 above, neither Bidco nor any of the directors of Bidco, any member of the Bidco Group or Vitruvian Partners, nor, so far as the Bidco Directors are aware, any person acting in concert with Bidco for the purposes of the Acquisition, has any interest in, right to subscribe for, or has borrowed or lent IMD Shares or securities convertible or exchangeable into IMD Shares (including pursuant to any long exposure, whether conditional or absolute, to changes in the process of securities) or right to subscribe for or purchase the same or holds any options (including traded options) in respect of or has any right to acquire any IMD Shares or derivatives referenced to IMD Shares ("IMD Securities"), nor does any such person have any short position under a derivative, any agreement to sell or any delivery obligations or right to require another person to purchase or take delivery in relation to IMD Securities.

(a) IMD Shares held by Bidco, any member of the Bidco Group or Vitruvian Partners or persons acting in concert with Bidco for the purposes of the Acquisition as at the date of this announcement

 
                                                         Percentage of 
                                                         existing issued share 
  Name(1)                     Number of IMD Shares       capital 
  Simon Cox                   125,000                    0.36 
  Philip McDanell(1)          195,630                    0.57 
  Andrew Troullides           20,000                     0.06

Notes:

(1) Philip McDanell has a beneficial interest in 195,630 IMD Shares which are held by Rock Nominees Limited on behalf of his personal pension scheme.

(b) Securities convertible or exchangeable into IMD Shares held by Bidco, any member of the Bidco Group or Vitruvian Partners or persons acting in concert with Bidco for the purposes of the Acquisition as at the date of this announcement

 
                                              Exercise 
                             IMD Shares         Price 
     Management              under option      (pence)        Exercise Date 
                                                                 50 per cent. 
                                                                 from 08/11/07 
  Simon Cox                  834,000               55            to 08/05/16 
                                                                 50 per cent. 
                                                                 from 08/05/09 
                                                                 to 08/05/16 
                                                                 06/03/10 to 
  Simon Cox                  381,000               40            06/03/17 
                                                                 17/12/11 to 
  Simon Cox                  134,556               27            17/12/18 
                                                                 17/12/11 to 
  Simon Cox                  265,444               27            17/12/18 
                                                                 08/11/06 to 
  Simon Cox                  160,000               55            08/05/16 
                                                                 06/03/10 to 
  Simon Cox                  19,000                40            06/03/17 
                                                                 28/02/11 to 
  Philip McDanell            25,000                40            28/02/18 
                                                                 01/12/12 to 
  Philip McDanell            70,000                50            01/12/19 
                                                                 01/01/09 to 
  Andrew Troullides          160,000               40            21/12/16 
                                                                 28/02/11 to 
  Alistair Hepworth          25,000                40            28/02/18 
                                                                 06/10/12 to 
  Alistair Hepworth          30,000                45            06/10/19 
                                                                 01/12/12 to 
  Alistair Hepworth          20,000                50            01/12/19 
  Clinton Van                                                    28/02/11 to 
   Ry                        25,000                40            28/02/18 
  Clinton Van                                                    06/10/12 to 
   Ry                        30,000                45            06/10/19 
  Clinton Van                                                    01/12/12 to 
   Ry                        20,000                50            01/12/19 
                                                                 06/10/12 to 
  Jean Gaillard              125,000               45            06/10/19 
                                                                 28/02/11 to 
  Ralph Hekmat               80,000                40            28/02/18 
  Ross Hunter                                                    20/02/02 to 
   Priestley                 12,992                13.47         21/03/11 
  Ross Hunter                                                    31/12/03 to 
   Priestley                 12,000                60            30/06/13 
  Ross Hunter                                                    01/10/08 to 
   Priestley                 50,000                40            30/09/15 
  Ross Hunter                                                    01/12/12 to 
   Priestley                 40,000                50            01/12/19 
                                                                 20/02/02 to 
  Shelby Lea Akosa           18,188                13.47         21/03/11 
                                                                 31/12/03 to 
  Shelby Lea Akosa           12,000                60            30/06/13 
                                                                 01/10/08 to 
  Shelby Lea Akosa           50,000                40            30/09/15

15. Inducement Fee Agreement

IMD has entered into the Inducement Fee Agreement with Vitruvian Partners (on behalf of Bidco) under which IMD has given various undertakings to Vitruvian Partners, including an undertaking that it will not (and shall procure that none of its directors, officers, senior employees or advisers shall) solicit or initiate discussions with any third party in respect of a possible offer for IMD or any other transaction which is inconsistent with, or an alternative to, the Acquisition.

As an inducement to Vitruvian Partners to pursue its discussions with IMD in relation to a possible offer, IMD has agreed to pay an inducement fee to Vitruvian Partners of one per cent. of the value of the Acquisition (plus any VAT only to the extent both applicable and recoverable by IMD). The circumstances in which the inducement fee will be payable include where:

-- an Independent Inconsistent Transaction is announced before the Acquisition becomes effective or is declared unconditional in all respects or lapses or is withdrawn and such Independent Inconsistent Transaction subsequently becomes or is declared unconditional in all respects or otherwise completes or becomes effective; or

-- the Independent Directors announce publicly that they are recommending or approving an Independent Inconsistent Transaction; or

-- the Independent Directors withdraw their recommendation of the Acquisition or adversely modify their recommendation; or

-- the Independent Directors refuse to put forward the Scheme to the shareholders of IMD; or

-- IMD enters into any arrangement with regard to inducement fees, break fees or the underwriting of costs or expenses or other similar arrangements with any other party in connection with an Independent Inconsistent Transaction.

16. Structure of the Acquisition

It is currently intended that the Acquisition will be effected by means of a scheme of arrangement under Part 26 of the Companies Act 2006. This procedure involves an application by IMD to the Court to sanction the Scheme and to confirm the cancellation of Scheme Shares pursuant to the Capital Reduction.

The implementation of the Scheme will be subject to a number of conditions including the Conditions and the passing of a resolution to approve the Scheme by a simple majority in number of the Independent Scheme Shareholders present, entitled to vote and voting at the Court Meeting (or at an adjournment thereof), either in person or by proxy, representing not less than 75 per cent. in value of Scheme Shares voted at the Court Meeting (or at any adjournment thereafter). In addition, the Scheme will require, amongst other things, the following events to occur:

-- Bidco and each Executive Manager holding IMD Shares undertaking to the Court that they consent to and will be bound by the terms of the Scheme;

-- a special resolution in General Meeting to approve and implement the Scheme, the Capital Reduction any proposed reorganisation of IMD's share capital (including the redesignation of the Cox Shares as A Ordinary Shares) and amendments to the articles of association of IMD being passed at the General Meeting;

-- an ordinary resolution to approve on a poll the arrangements between Bidco and the Executive Managers being passed at the General Meeting; and

-- the sanction of the Scheme and confirmation of the Capital Reduction by the Court and office copies of the Court Orders being delivered to the Registrar and, in the case of the Capital Reduction, such Court Order together with the Statement of Capital being registered by the Registrar.

Upon the Scheme becoming effective, it will be binding on all Scheme Shareholders, irrespective of whether they attended or voted at the Court Meeting or the General Meeting (and if they attended and voted, whether or not they voted in favour).

Further details of the Scheme will be contained in the Scheme Document, which will be posted to IMD Shareholders and, for information purposes only, to participants in the IMD Share Schemes, within 28 days of this announcement, unless otherwise agreed with the Panel.

It is expected that the Scheme Document will be posted by 25 March 2011 and will become effective by the end of May 2011 subject to the satisfaction (or, if applicable, waiver) of all relevant conditions (including the Conditions).

17. Implementation Agreement

IMD and Bidco have entered into the Implementation Agreement which governs their relationship during the period until the Acquisition becomes effective, lapses or is withdrawn or the agreement is otherwise terminated. The parties have agreed, amongst other things, to co-operate with regard to the process of implementing the Acquisition. The agreement contains certain assurances and confirmations between the parties (including terms regarding timing and the conduct of the business of the IMD Group pending completion of the Acquisition).

The Implementation Agreement provides that if a firm announcement of an Independent Inconsistent Transaction is made (either under Rule 2.5 of the City Code or, to the extent Rule 2.5 does not apply, any other announcement of an Independent Inconsistent Transaction), Bidco may revise the terms of the Acquisition ("Revised Offer"), and for a period of 48 hours from such announcement, IMD shall not (and it shall procure that no IMD Director nor any member of the IMD Group shall):

-- accept, approve, recommend or enter into any agreement to implement such Independent Inconsistent Transaction;

-- withhold, withdraw, adversely modify or qualify their unanimous recommendation of the Scheme or, should Bidco elect (with Panel approval) to implement the Acquisition by way of an Offer, the Offer; or

-- withdraw or fail to proceed (in accordance with the timetable agreed between the parties) with the Scheme (if applicable).

If such Revised Offer is communicated to either the IMD Directors or IMD's financial adviser within 48 hours of the firm announcement of the Independent Inconsistent Transaction, and provides in the reasonable opinion of IMD's reputable financial advisor for the purposes of the City Code, equal or better financial value to IMD Shareholders in comparison to the Independent Inconsistent Transaction, the Independent Directors shall as soon as reasonably practicable make a unanimous and unqualified recommendation of the Revised Offer to the IMD Shareholders and shall withdraw any recommendation that they may have made of the Independent Inconsistent Transaction and shall not recommend that Independent Inconsistent Transaction set out in the firm announcement of that transaction. IMD will not be liable in respect of any obligation relating to a Revised Offer where IMD's directors or the Independent Directors reasonably believe (after taking advice) that acting or refraining from acting in relation to the Revised Offer would cause the IMD directors or the Independent Directors to be in breach of their statutory and fiduciary duties (if applicable) to IMD.

The Implementation Agreement terminates in certain circumstances, including:

-- if the Acquisition is not sanctioned by the IMD Shareholders;

-- if the Acquisition has not become effective by 12 August 2011 or such later date as Bidco and IMD shall agree;

-- by notice in writing from one party to the other party following a material breach of any of the obligations of the other party under the Implementation Agreement which, if capable of remedy, the other party has failed to remedy within three Business Days of a written notice from the first party requesting the same; a material breach for this purpose includes a failure to allow Bidco to make a Revised Offer (as defined above);

-- if an Independent Inconsistent Transaction becomes or is declared wholly unconditional or is completed or becomes effective;

-- if the European Commission initiates proceedings under Article 6(1)(c) of the Council Regulation 139/2004/EC ("Regulation") or, following a referral by the European Commission under Article 9(1) of the Regulation to a competent authority in the United Kingdom, there is a subsequent reference to the United Kingdom Competition Commission;

-- by notice in writing from one party to the other party if the recommendation of the Independent Directors is withdrawn, modified or qualified at any time prior to the Scheme becoming effective;

-- in the event that such termination is agreed in writing between the parties at any time before the Effective Date;

-- if any of the Conditions which has not been waived is (or becomes) incapable of satisfaction and if Bidco notifies IMD that notwithstanding that it has the right to waive a Condition, it will not do so and that the Panel has confirmed that it will permit Bidco to invoke such Condition;

-- if Bidco elects to announce a unilateral unrecommended offer or a mandatory offer for IMD under the City Code; or

-- the inducement fee under the Inducement Fee Agreement is paid.

18. Cancellation of admission to trading on AIM and re-registration

The London Stock Exchange will be requested to cancel the admission to trading of IMD Shares on AIM when the Acquisition becomes effective. The last day of dealings in IMD Shares on AIM is expected to be on the business day immediately prior to the Effective Date and no transfers of IMD Shares will be registered after 6.00 p.m. on that date. On the Effective Date, share certificates in respect of IMD Shares will cease to be valid and should be destroyed. In addition, entitlements to IMD Shares held within the CREST system will be cancelled on the Effective Date.

It is intended that, upon the Scheme becoming effective, and after the admission to trading on AIM of the IMD Shares has been cancelled, IMD will be re-registered as a private company.

19. General

Your attention is drawn to the further information in the Appendices which form part of this announcement.

Appendix I sets out Conditions and certain further terms of the Acquisition.

Appendix II sets out the sources of information and basis of calculations used in this announcement.

Appendix III sets out the details of those IMD Directors and IMD Shareholders who have given an irrevocable commitment.

Appendix IV contains the definitions of terms used in this announcement.

The Acquisition will be governed by English law and will be subject to the applicable requirements of the City Code, the Panel and the AIM Rules.

20. Enquiries

 
 Bidco                                     Tel: + 44 (0)20 7518 
                                            2800 
 Toby Wyles / Ben Johnson 
 
 DC Advisory Partners, financial adviser   Tel: + 44 (0) 20 7856 
  to Bidco                                  0999 
 Richard Madden / David Sanders 
 
 IMD                                       Tel: +44 (0) 7765 258 
                                            995 
 David Haynes 
 
 Oakley Capital, financial adviser         Tel: + 44 (0) 20 7766 
  to IMD                                    6900 
 Chris Godsmark / Daniel Havercroft

21. Further information

Overseas Shareholders

Cautionary note regarding forward looking statements

Disclosure requirements

Terms in quotation marks are defined in the City Code, which can also be found on the Panel's website at www.thetakeoverpanel.org.uk.

Market Purchases

Publication on website

Appendix I

Conditions to and certain further terms of the acquisition

Part A: The Conditions

1. The Acquisition will, if it is implemented by way of the Scheme, be conditional upon the Scheme becoming unconditional and becoming effective, subject to the City Code, by not later than 12 August 2011 or such later date (if any) as Bidco and IMD may, with the consent of the Panel, agree and (if required) the Court may allow.

The Scheme will be conditional upon:

(i) the approval of the Scheme by a majority in number representing 75 per cent. or more in value of the Independent Scheme Shareholders who are on the register of members of IMD at the Voting Record Time, present and voting, either in person or by proxy, at the Court Meeting and at any separate class meeting which may be required by the Court or at any adjournment of that Court Meeting or any such separate class meeting;

(ii) the special resolutions in connection with and required to approve and implement the Scheme, the arrangements in respect of the Cox Shares and the Capital Reduction and set out in the notice of the General Meeting being duly passed by the requisite majority at the General Meeting (or at any adjournment thereof);

(iii) the ordinary resolution in connection with and required to approve and implement the arrangements made and to be made between the Executive Managers and Bidco set out in the notice of the General Meeting being duly passed by the requisite majority at the General Meeting (or at any adjournment thereof); and

(iv) the sanction of the Scheme (without modification, or with such modifications as are agreed by Bidco and IMD) and the confirmation of the Capital Reduction by the Court and the Court Orders and the Statement of Capital being delivered for registration to the Registrar of Companies.

2. In addition, IMD and Bidco have agreed that, subject as stated in the first paragraph of Part B below, below, application to the Court to sanction the Scheme and to confirm the Capital Reduction will not be made and the office copies of the Court Orders and the Statement of Capital attached thereto will not be delivered for registration to the Registrar of Companies unless conditions 1(i) to (iii) inclusive above have been fulfilled and unless prior to the Scheme Court Hearing the following Conditions (as amended if appropriate) have been (and continue to be) satisfied pending the commencement of that hearing or waived as referred to below:

(a) no Third Party having intervened and there not continuing to be outstanding any statute, regulation, notice, decision or order of any Third Party in each case which would or might reasonably be expected to:

(i) make the Acquisition, its implementation or the acquisition or the proposed acquisition by Bidco or any member of the Wider Bidco Group of any shares or other securities in IMD, or control or management of, IMD or any other member of the Wider IMD Group void, illegal or unenforceable in any jurisdiction, or otherwise directly or indirectly restrain, prevent, prohibit, restrict, delay or otherwise materially adversely interfere with the same or impose additional conditions or obligations with respect to the Acquisition (or its implementation) or such acquisition, or otherwise impede or challenge the Acquisition (or its implementation) or such acquisition, or require material adverse amendment to the terms of the Acquisition or the acquisition of any IMD Shares or the acquisition of control or management of IMD or any other member of the Wider IMD Group by Bidco or any member of the Wider Bidco Group;

(ii) limit or delay the ability of any member of the Wider Bidco Group or any member of the Wider IMD Group to acquire or to hold or to exercise effectively, directly or indirectly, all or any rights of ownership in respect of shares or other securities (or the equivalent) in, or to exercise voting or management control over, any member of the Wider IMD Group or any member of the Wider Bidco Group, in each case, to an extent which is material in the context of the Wider IMD Group or Wider Bidco Group, in each case, taken as a whole;

(iii) require, prevent or materially delay any divestiture or alter the terms envisaged for any divestiture by any member of the Wider Bidco Group of any shares or other securities in IMD or any member of the Wider IMD Group (in any case to an extent which is material in the context of the Wider Bidco Group or the Wider IMD Group, as the case may be, taken as a whole);

(iv) require, prevent or materially delay any divestiture or alter the terms envisaged for any divestiture by any member of the Wider Bidco Group or by any member of the Wider IMD Group of all or any material part of their respective businesses, assets or properties or limit the ability of any of them to conduct all or any part of their respective businesses or to own or control any of their respective assets or properties or any part thereof (in any case to an extent which is material in the context of the Wider Bidco Group or the Wider IMD Group, as the case may be, taken as a whole);

(v) other than in connection with the implementation of the Acquisition, require any member of the Wider Bidco Group or of the Wider IMD Group to subscribe for or acquire, or to offer to subscribe for or acquire, any shares or other securities (or the equivalent) or interest in any member of the Wider IMD Group or the Wider Bidco Group;

(vi) limit the ability of any member of the Wider Bidco Group or of the Wider IMD Group to integrate its business, or any part of it, with the businesses or any part of the businesses of any other member of the Wider Bidco Group and/or of the Wider IMD Group in each case in a manner which is material in the context of the Acquisition, or as the case may be, in the context of the Wider Bidco Group or the Wider IMD Group, as the case may be, taken as a whole;

(vii) result in any member of the Wider IMD Group ceasing to be able to carry on business under any name under which it presently does so (in any case to an extent which is material in the context of the Wider IMD Group, as taken as a whole); or

(viii) otherwise, adversely affect the business, assets, profits, financial or trading position or long term prospects (where such long term prospects do not relate to a change in general economic conditions and which could not reasonably have been foreseen on the date hereof) of any member of the Wider Bidco Group to a material extent or of the Wider IMD Group, taken as a whole, to a material extent,

in each case to the extent which is material in the context of the Wider IMD Group taken as a whole and all applicable waiting and other time periods during which any Third Party could intervene under any applicable legislation or regulation of any relevant jurisdiction having expired, lapsed or been terminated (as the case may be);

(b) all notifications, filings and/or applications which are necessary having been made, all appropriate waiting and other time periods (including any extensions of such waiting and other time periods) under any applicable legislation or regulation of any relevant jurisdiction having expired, lapsed or terminated (as appropriate) and all statutory or regulatory obligations in any relevant jurisdiction having been complied with, in each case in connection with the Acquisition or the acquisition or proposed acquisition of any shares or other securities in, or control of, IMD or any other member of the Wider IMD Group by any member of the Wider Bidco Group or the carrying on by any member of the Wider IMD Group of its business in each case where the absence thereof would have a material adverse effect on the Acquisition or, as the case may be, on the Wider IMD Group taken as a whole;

(c) all Authorisations which are necessary in any relevant jurisdiction for or in respect of the Acquisition (or its implementation) or the acquisition or proposed acquisition of any shares or other securities in, or control or management of, IMD or any other member of the Wider IMD Group by Bidco or any member of the Wider Bidco Group or the carrying on by any member of the Wider IMD Group of its business having been obtained, in terms and in a form satisfactory to Bidco, acting reasonably, from all appropriate Third Parties or from any persons or bodies with whom any member of the Wider Bidco Group or any member of the Wider IMD Group has entered into contractual arrangements and such Authorisations together with all authorisations necessary for any member of the Wider IMD Group to carry on its business remaining in full force and effect, and there being no notice or other intimation of any intention to revoke, suspend, restrict, modify or not to renew any of the same having been made in connection with the Acquisition or any other matter directly, or indirectly, arising from the Acquisition (or its implementation), in each case where the absence of such Authorisation would have a material adverse effect on the Wider IMD Group or the Wider Bidco Group, as the case may be, taken as a whole and all necessary statutory or regulatory obligations in any relevant jurisdiction having been complied with;

(d) save as Disclosed, there being no provision of any arrangement, agreement, lease, licence, permit, franchise or other instrument to which any member of the Wider IMD Group is a party, or by or to which any such member or any of its assets is or are or may be bound, entitled or subject, or any circumstance, which, in each case as a consequence of the Acquisition (or its implementation) or the acquisition or proposed acquisition of any shares or other securities in IMD, or control or management of, IMD or any other member of the Wider IMD Group by any member of the Wider Bidco Group or otherwise, could reasonably be expected to result in, in any case to an extent which is or would be material in the context of the Wider IMD Group taken as a whole:

(i) any monies borrowed by or any other indebtedness or liabilities (actual or contingent) of, or any grant available to, any member of the Wider IMD Group being or becoming repayable or capable of being declared repayable immediately or prior to its stated repayment date or the ability of any member of the Wider IMD Group to borrow monies or incur any indebtedness being withdrawn or inhibited or becoming capable of being withdrawn or inhibited;

(ii) the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property, assets or interests of any member of the Wider IMD Group or any such mortgage, charge or other security interest (wherever and whenever created, arising or having arisen) becoming enforceable;

(iii) any such arrangement, agreement, lease, licence, permit, franchise or instrument, or the rights, liabilities, obligations or interests of any member of the Wider IMD Group thereunder, being, terminated or materially adversely modified or affected or any adverse action being taken or arising thereunder or any onerous obligation or material liability arising thereunder;

(iv) any asset or interest of any member of the Wider IMD Group being or falling to be disposed of or charged (otherwise than in the ordinary course of business) or ceasing to be available to any member of the Wider IMD Group or any right arising under which any such asset or interest could be required to be disposed of or charged;

(v) any member of the Wider IMD Group ceasing to be able to carry on business under any name under which it presently does so;

(vi) the creation or assumption of any liabilities (actual or contingent) by any member of the Wider IMD Group other than in the ordinary course of business;

(vii) the financial or trading position or the long term prospects (where such long term prospects do not relate to a change in general economic conditions and which could not reasonably have been foreseen on the date hereof) or the value of any member of the Wider IMD Group being prejudiced or adversely affected in any manner; or

(viii) any member of the Wider IMD Group being required to acquire or repay any shares in and/or indebtedness of any member of the Wider IMD Group owned by or owed to any third party,

and no event having occurred which, under any provision of any such arrangement, agreement, lease, licence, permit, franchise or other instrument to which any member of the Wider IMD Group is a party, or by or to which any such member or any of its assets may be found entitled or subject, could reasonably be expected to result in any of the events or circumstances which are referred to in paragraphs (i) to (viii) of this condition (d) in any case to an extent which is or would be material in the context of the Wider IMD Group as a whole;

(e) save as Disclosed, no member of the Wider IMD Group, since 31 December 2009, being the date to which the last published audited report and accounts of IMD were made up:

(i) save as between IMD and wholly owned subsidiaries of IMD or between such subsidiaries, issued or agreed to issue, or authorised the issue of, additional shares or securities of any class, or securities convertible into or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities (save for any IMD Shares allotted upon exercise of options or vesting of awards granted, under the IMD Share Schemes before the date hereof, provided such options or awards have been Disclosed), or redeemed, purchased or reduced any part of its share capital,

(ii) purchased or redeemed or repaid or proposed the purchase, redemption or repayment of any of its own shares or other securities (or the equivalent) or reduced or made or authorised any other change to any part of its share capital other than pursuant to the implementation of the Acquisition;

(iii) recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus issue in respect of shares, dividend or other distribution, whether payable in cash or otherwise;

(iv) except as between IMD and any of its wholly owned subsidiaries or between such subsidiaries, made, authorised, proposed or announced an intention to make, propose or authorise any change in its loan capital;

(v) merged with, demerged or acquired any body corporate, partnership or business or acquired or disposed of or (other than in the ordinary course of business) transferred, mortgaged or charged or created any security interest over any material assets or any right, title or interest in any material assets (including shares in any undertaking and trade investments) or authorised, proposed or announced the same, which in any case is material in the context of the Wider IMD Group taken as a whole;

(vi) issued or authorised the issue of, or made any change in or to, any debentures or, other than trade credit incurred in the ordinary course of business, incurred or increased any indebtedness or liability (actual or contingent) except as between IMD and any of its wholly owned subsidiaries or between such subsidiaries, which in any case is material in the context of the Wider IMD Group taken as a whole;

(vii) entered into, varied, authorised or announced its intention to enter into or vary any agreement, transaction, arrangement or commitment (whether in respect of capital expenditure or otherwise) which:

(A) is of a long term, onerous or unusual nature or magnitude; or

(B) restricts the business of any member of the Wider IMD Group, or

and which in any case is material in the context of the Wider IMD Group taken as a whole;

(viii) entered into, implemented, effected or authorised any merger, demerger, reconstruction, amalgamation, scheme, commitment or other transaction or arrangement in respect of itself or another member of the Wider IMD Group, which in any case is material in the context of the Wider IMD Group taken as a whole;

(ix) save in relation to any amendments described in this announcement, entered into or varied or made an offer (which remains open for acceptance) to vary the terms of any contract, agreement, commitment or arrangement with, any of the directors or senior executives of any member of the Wider IMD Group or changed or entered into any commitment to change the terms of any of the IMD Share Schemes save for salary increases and bonuses not resulting in total annual remuneration of any individual exceeding the immediately preceding year's remuneration by more than three per cent. or other variations of terms in the ordinary course of business which are not material in the context of the Acquisition or the Wider IMD Group taken as a whole;

(x) taken any corporate action or had any step, application, filing in court, notice or legal proceedings started, served, instituted or threatened in writing against it or petition presented or order made for its winding-up (voluntarily or otherwise), dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any material part of its assets and revenues or any analogous proceedings in any jurisdiction which in any case is material in the context of the Wider IMD group taken as a whole;

(xi) been unable, or admitted in writing that it is unable, to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or having entered into or taken steps to enter into a moratorium, composition, compromise or arrangement with its creditors in respect of its debts or ceased or threatened to cease carrying on all or a substantial part of its business;

(xii) waived, settled or compromised any claim to an extent which is material in the context of the Wider IMD Group taken as a whole;

(xiii) terminated or varied the terms of any agreement or arrangement between any member of the IMD Group and any other person in a manner which would or might reasonably be expected to have a material adverse effect on the financial position or long term prospects (where such long term prospects do not relate to a change in general economic conditions and which could not reasonably have been foreseen on the date hereof) of the Wider IMD Group taken as a whole;

(xiv) made any alteration to its memorandum or articles of association or other incorporation documents save as required to implement the Acquisition save where required by law or regulation;

(xv) put in place any pension schemes for its directors, employees or their dependants or made or agreed or consented to any change to:

(A) the terms of the trust deeds constituting the pension schemes (if any) established for its directors, employees or their dependants; or

(B) the benefits which accrue, or to the pensions which are payable, thereunder; or

(C) the basis on which qualification for, or accrual or entitlement to, such benefits or pensions are calculated or determined; or

(D) the basis upon which the liabilities (including pensions) of such pension schemes are funded or made,

or agreed or consented to any change to the trustees including the appointment of a trust corporation;

(xvi) proposed, agreed to provide or modified the terms of any share option scheme, incentive scheme or other benefit relating to the employment or termination of employment of any person employed by the Wider IMD Group in a manner which is material in the context of the Wider IMD Group taken as a whole; or

(xvii) entered into any contract, agreement, commitment or arrangement or passed any resolution or made any offer (which remains open for acceptance) or proposed or announced any intention with respect to any of the transactions, matters or events referred to in this condition (e);

(f) since 31 December 2009, save as Disclosed:

(i) no adverse change or deterioration having occurred in the business, assets, financial or trading position or profits of any member of the Wider IMD Group which in any case is material in the context of the Wider IMD Group taken as a whole;

(ii) no contingent or other liability of any member of the Wider IMD Group having arisen or been incurred or has been materially increased which in any case is material in the context of the Wider IMD Group taken as a whole;

(iii) no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the Wider IMD Group is or may become a party (whether as plaintiff, defendant or otherwise) having been threatened in writing, announced, implemented or instituted by or against or remaining outstanding against or in respect of any member of the Wider IMD Group which in any case is material in the context of the Wider IMD Group taken as a whole;

(iv) no enquiry or investigation by, or complaint or reference to, any Third Party having been threatened, announced, implemented, instituted by or against or remaining outstanding against or in respect of any member of the Wider IMD Group which in any case is material in the context of the Wider IMD Group taken as a whole;

(v) no claim being made and no circumstance having arisen which might reasonably be expected to lead to a claim being made under the insurance of any member of the Wider IMD Group where such claim would not be covered by such insurance and where such claim is material in the context of the Wider IMD Group taken as a whole; and

(vi) no steps having been taken which are reasonably likely to result in the withdrawal (without replacement), cancellation or termination of any licence, permit or consent held by any member of the Wider IMD Group which is necessary for the carrying on by such member of its business and which is material in the context of the Wider IMD Group taken as a whole;

(g) Save as Disclosed, Bidco not having discovered:

(i) that any financial, or business or other information concerning the Wider IMD Group disclosed publicly at any time by or on behalf of any member of the Wider IMD Group, is materially misleading or contains any material misrepresentation of fact or omits to state a fact necessary to make any information contained therein not materially misleading, in any case, to an extent which is material in the context of the Wider IMD Group taken as a whole;

(ii) that any member of the Wider IMD Group is subject to any liability (actual or contingent) which is material in the context of the Wider IMD Group taken as a whole;

(iii) any information which affects the import of any information disclosed to Bidco at any time by or on behalf of any member of the Wider IMD Group to an extent which is material and adverse in the context of the Wider IMD Group taken as a whole;

(iv) that any past or present member of the Wider IMD Group has failed to comply with any applicable legislation, regulations or common law of any jurisdiction or any notice, order or requirement of any Third Party with regard to the use, treatment, handling, storage, transport, release, disposal, discharge, presence, spillage, leak or emission of any waste or hazardous or harmful substance or any substance likely to impair the environment or harm human or animal health, or otherwise relating to environmental matters or the health and safety of any person, or that there has otherwise been any such use, treatment, handling, storage, transport, release, disposal, discharge, presence, spillage, leak or emission (whether or not the same constituted non-compliance by any person with any legislation, regulations or law and wherever the same may have taken place) which, in any case, would be reasonably likely to give rise to any liability (whether actual or contingent) or cost on the part of any member of the Wider IMD Group which in any case is material in the context of the Wider IMD Group taken as a whole; or

(v) that there is, or is reasonably likely to be, any obligation or liability, whether actual or contingent, to make good, repair, reinstate, remedy or clean up any property now or previously owned, occupied, operated or made use of or controlled by any past or present member of the Wider IMD Group or any other property or controlled waters under any environmental legislation, regulation, common law, notice, circular, order or other lawful requirement of any relevant authority or Third Party in any jurisdiction or otherwise which in any case is material in the context of the Wider IMD Group taken as a whole.

For the purpose of these conditions:

(a) "Third Party" means any government, government department or governmental, quasi-governmental, supranational, statutory, regulatory, environmental or investigative body or association, institution or agency or authority (including, without limitation, any anti-trust or merger control authority), any court or professional or environmental body or any other person or body whatsoever in any relevant jurisdiction;

(b) a Third Party shall be regarded as having "intervened" if it has taken, instituted, implemented or threatened (by notice in writing) any action, proceeding, suit, investigation, enquiry or reference or made, proposed or enacted any statute, regulation, decision, notice or order or taken any measures or other steps or required any action to be taken or information to be provided or otherwise having done anything and "intervene" shall be construed accordingly; and

(c) "Authorisations" means authorisations, orders, grants, recognitions, determinations, certificates, confirmations, consents, licences, clearances, provisions, permissions and approvals.

Part B: Waiver of Conditions and further terms of the Acquisition

To the extent permitted by law and subject to the requirements of the Panel, Bidco reserves the right to waive all or any of the above conditions, in whole or in part, except Condition 1. Bidco shall be under no obligation to waive (if capable of waiver), to determine to be or remain satisfied or to treat as fulfilled any of conditions 2(a) to (g) (inclusive) by a date earlier than the date specified in paragraph 1 of Part A of this Appendix I for the fulfillment thereof.

Bidco reserves the right to elect to implement the Acquisition by way of a takeover offer (subject to the Panel's consent). In such event, such offer will be implemented on the same terms and conditions (subject to appropriate amendments, including (without limitation) an acceptance condition set at ninety per cent. (or such lower percentage (being more than fifty per cent.) as Bidco may decide (subject to the Panel's consent)) of the shares to which such offer relates), so far as applicable, as those which would apply to the Scheme.

If the Panel requires Bidco to make an offer or offers for any IMD Shares under the provisions of Rule 9 of the City Code, Bidco may make such alterations to the conditions of the Acquisition, including to Condition 1, as are necessary to comply with the provisions of that Rule.

The Acquisition will lapse and the Scheme will not proceed (unless the Panel otherwise consents) if the European Commission initiates proceedings under Article 6(1)(c) of Council Regulation (EC) 139/2004 or makes a referral to a competent authority of the United Kingdom under Article 9(3)(b) of that Regulation or the Acquisition or any matter arising from or relating to the Acquisition is referred to the Competition Commission before the date of the Court Meeting(s).

The Acquisition will be on the terms and will be subject, interalia, to the conditions which are set out in Part A of this Appendix I and those terms which will be set out in the formal Scheme Document and related Forms of Proxy and such further terms as may be required to comply with the AIM Rules of the London Stock Exchange and the provisions of the City Code.

If the Acquisition is effected, save to the extent cancelled pursuant to the Scheme, IMD Shares will be acquired pursuant to the Acquisition fully paid and free from all liens, charges, equitable interests, encumbrances, rights of pre-emption and any other rights and interests of any nature whatsoever and together with all rights now and hereafter attaching thereto, including voting rights and the right to receive and retain in full all dividends and other distributions (if any) declared, made or paid on or after the date of this announcement.

Under Rule 13.4 of the City Code, Bidco may only invoke a condition to the Acquisition so as to cause the Acquisition not to proceed, to lapse or to be withdrawn if the circumstances which give rise to the right to invoke the condition are of material significance to Bidco in the context of the Acquisition. The conditions contained in paragraph 1 of Part A of this Appendix I and the conditions related to the European Commission and the Competition Commission in the fourth paragraph of this Part B are not subject to this provision of the Code.

The Acquisition and the Scheme will be governed by English law and will be subject to the jurisdiction of the English courts. The rules contained in the Code, so far as they are appropriate, apply to the Acquisition.

The availability of the Acquisition to persons not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements.

APPENDIX ii

bases and sources of information

In this announcement:

(a) the value placed by the Acquisition on the entire issued and to be issued share capital of IMD (approximately GBP33.9 million) is based on 37,215,602 IMD Shares in issue and/or to be issued on 25 February 2011, the last business day prior to the date of this announcement;

(b) the Closing Price of the IMD Shares referred to in this announcement represents the closing middle market price for IMD Shares on the relevant date as derived from the AIM Appendix to the Official List;

(c) the six month and twelve month average share price for IMD Shares has been calculated using the closing middle market prices for IMD Shares on the relevant dates as derived from the AIM Appendix to the Official List; and

(d) unless otherwise stated, the financial information relating to IMD is extracted from the Annual Report and Accounts of IMD for the year ended 31 December 2009 and the interim results of IMD published for the six month period ended 30 June 2010.

APPENDIX III

details of irrevocable undertakings

Part A: Independent Directors

The following Independent Directors (and their related trusts and associated companies) have given irrevocable undertakings to: (i) vote in favour of the Acquisition at the Court Meeting; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) to accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more, in relation to the following IMD Shares:

 
                                                        Percentage of issued 
             Name                Number of IMD Shares    share capital of IMD 
 Charles Dunstone                        4,004,961(3)                    11.7 
 Ian Stevenson                             120,000(4)                     0.4 
 David Haynes                               1,461,225                     4.3 
 Charles Cox(1)                                75,000                     0.2 
 Hudson Management Limited(2)               7,937,938                    23.1

Notes:

1. Charles Cox is interested in and has given his irrevocable undertaking in respect of IMD Shares held by Tirol Trading Corporation (BVI), a company associated with him. Tirol Trading Corporation (BVI) has also entered into an irrevocable undertaking on the same terms as Charles Cox in respect of the same 75,000 IMD shares.

2. Hudson Management Limited is a company associated with David Haynes.

3. Includes 1,000,000 IMD Shares held on Charles Dunstone's behalf by Goldman Sachs Nominees.

4. Includes 100,000 IMD Shares held by Hargreaves Lansdown on behalf of Ian Stevenson's self invested personal pension. Ian Stevenson has also given an irrevocable undertaking on the same terms in respect of his options over 25,000 IMD Shares.

The undertakings in this Part A will remain binding in all circumstances.

Part B: Executive Managers

The following Executive Managers (and their related trusts and associated companies) have given irrevocable undertakings to: (i) consent to the Acquisition and undertake to the Court to be bound by the Scheme; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting (other than the resolution approving the Management Arrangements); and (iii) to accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more in relation to the following IMD Shares:

 
                                              Percentage of issued 
        Name           Number of IMD Shares    share capital of IMD 
 Simon Cox(5)                       125,000                     0.4 
 Philip McDanell(6)                 195,630                     0.6

5. Held in the name of Rock Nominees Limited as trustee for the IPM personal pension scheme. Philip McDanell has also given an irrevocable undertaking on the same terms in respect of his options as set out in paragraph 14 of this announcement.

(6) Simon Cox has also given an irrevocable undertaking on the same terms in respect of his options as set out in paragraph 14 of this announcement.

The undertakings in this Part B will remain binding in all circumstances.

Other shareholders

The following Independent IMD Shareholders (other than the Independent Directors) (and their related trusts and associated companies) have given irrevocable undertakings to: (i) consent to the Acquisition and undertake to the Court to be bound by the Scheme; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) to accept any potential takeover offer subsequently made by Bidco at a price per IMD Share of 91 pence or more in relation to the following IMD Shares:

 
                                                   Percentage of issued 
           Name             Number of IMD Shares    share capital of IMD 
 Herald Investment Trust 
  Plc(7)                               3,142,300                     9.2 
 Michael Burn                          1,950,000                     5.7 
 Peter Haynes(8)                         592,500                     1.7

7. Held in the name of Herald Investment Management Limited.

8. Held in the name of Fitel Nominees Limited.

The undertakings listed in this Part C will remain binding in all circumstances other than if either (i) any Independent Inconsistent Transaction is announced pursuant to Rule 2.5 of the City Code at a price that is 10 per cent. greater than the Acquisition price of 91 pence per IMD Share; or (ii) any Independent Inconsistent Transaction becomes or is declared wholly unconditional.

appendix IV

DEFINITIONS

The following definitions apply throughout this announcement unless the context requires otherwise.

 
 "Acquisition"                       the proposed acquisition of IMD by Bidco 
                                     by means of the Scheme (or, should Bidco 
                                     so elect, by means of the Offer) on the 
                                     terms and subject to the conditions and 
                                     further terms set out in this 
                                     announcement and to be set out in the 
                                     Scheme Document (or the Offer Document 
                                     (as the case may be)) and where the 
                                     context admits, any subsequent revision, 
                                     variation, extension or renewal thereof 
                                     and together with all other related 
                                     matters to be considered at the Court 
                                     Meeting and General Meeting; 
 "Act" or "Companies Act             the Companies Act 2006 (as in force 
  2006"                               from time to time); 
 "AIM"                               the AIM market of the London Stock 
                                      Exchange; 
 "AIM Rules"                         the rules for AIM companies and their 
                                      nominated advisers published from time 
                                      to time by the London Stock Exchange; 
 "associate"                         shall be construed in accordance with 
                                      section 988(1) of the Companies Act 
                                      2006; 
 "Bidco"                             Lausanne Acquisitions Limited, a company 
                                      incorporated in England and Wales with 
                                      registered number 7479150; 
 "Bidco Directors"                   the directors of Bidco as at the date 
                                      of this announcement; 
 "Bidco Group"                       Holdco and its subsidiaries and 
                                     subsidiary undertakings and, where the 
                                     context permits, each of them; 
 "Bidco Ordinary Shares"             ordinary shares of GBP0.000001 each 
                                      in the capital of Bidco; 
 "board"                             the board of directors of a company; 
 "business day"                      a day which is not a Saturday, Sunday 
                                      or public holiday in England; 
 "Capital Reduction"                 the reduction of IMD's share capital 
                                      pursuant to section 648 of the Companies 
                                      Act 2006 provided for by the Scheme; 
 "City Code"                         the City Code on Takeovers and Mergers; 
 "Closing Price"                     the closing middle-market price of 
                                      an IMD Share as derived from the AIM 
                                      Appendix to the Official List; 
 "Conditions"                        the conditions to the implementation of 
                                     the Acquisition (including the Scheme) 
                                     which are set out in Appendix I of this 
                                     announcement; 
 "Court"                             the High Court of Justice in England 
                                      and Wales; 
 "Court Meeting"                     the meeting or meetings of Independent 
                                     Scheme Shareholders (and any adjournment 
                                     thereof) to be convened pursuant to an 
                                     order of the Court under Part 26 of the 
                                     Companies Act 2006 for the purposes of 
                                     considering and, if thought fit, 
                                     approving the Scheme (with or without 
                                     amendment); 
 "Court Order(s)"                    the Scheme Court Order and the Reduction 
                                      Court Order respectively or, where 
                                      the context requires, either of them; 
 "Cox Shares"                        219,780 Scheme Shares held by Simon 
                                      Cox; 
 "DC Advisory Partners"              DC Advisory Partners Limited, which 
                                      is authorised and regulated in the 
                                      United Kingdom by the Financial Services 
                                      Authority; 
 "Disclosed"                         (i) as disclosed in IMD's annual report 
                                     and accounts for the period ended 31 
                                     December 2009; (ii) or as disclosed in 
                                     IMD's interim results published for the 
                                     six months period ended 30 June 2010; or 
                                     (iii) as publicly announced by IMD 
                                     (through a Regulatory Information 
                                     Service) prior to the date of this 
                                     announcement; or (iv) as otherwise 
                                     disclosed, prior to the date of this 
                                     announcement, by or on behalf of IMD in 
                                     writing (including in minutes of 
                                     disclosure in meetings with the Executive 
                                     Managers) delivered to Vitruvian 
                                     Partners, Bidco or any other member of 
                                     the Bidco Group or their respective 
                                     advisers, employees or officers involved 
                                     in the Acquisition, or the negotiation 
                                     thereof; 
 "Effective Date"                    the effective date of the Scheme; 
 "Executive Managers"                members of the management of IMD who have 
                                     reached agreement with Bidco in relation 
                                     to the Management Arrangements, namely 
                                     Simon Cox, Philip McDanell, Ron 
                                     Priestley, Andrew Troullides, Clinton Van 
                                     Ry, Al Hepworth, Ralph Hekmat, Jean 
                                     Gaillard and Shelby Lea Akosa; 
 "Financial Services Authority"      the Financial Services Authority acting 
                                     in its capacity as the competent 
                                     authority for the purposes of Part VI of 
                                     the Financial Services and Markets Act 
                                     2000; 
 "Forms of Proxy"                    the forms of proxy for use at the Court 
                                      Meeting and the General Meeting; 
 "General Meeting"                   the general meeting of IMD Shareholders 
                                      (and any adjournment thereof) to be 
                                      convened in connection with the Scheme; 
 "Holdco"                            Lausanne Topco Limited, a company 
                                     incorporated in England and Wales with 
                                     registered number 7479143, being the 
                                     indirect holding company of Bidco; 
 "IMD" or the "Company"              Independent Media Distribution plc; 
 "IMD Group"                         IMD and its subsidiaries and subsidiary 
                                      undertakings and, where the context 
                                      permits, each of them; 
 "IMD Shareholders"                  the holders of IMD Shares; 
 "IMD Shares"                        the existing issued or unconditionally 
                                     allotted and fully paid (or credited as 
                                     fully paid) ordinary shares of 10 pence 
                                     each in the capital of IMD and any 
                                     further such shares which are 
                                     unconditionally allotted or issued fully 
                                     paid prior to the Reduction Record Time; 
 "IMD Share Schemes"                            (a) the option agreements 
                                                entered into by IMD and 
                                                various individuals, granting 
                                                long term incentive options to 
                                                such individuals over shares 
                                                in IMD; and (b) the option 
                                                agreements entered into by IMD 
                                                and various individuals, 
                                                granting enterprise management 
                                                incentive options to such 
                                                individuals over shares in 
                                                IMD; 
 "Implementation Agreement"          the agreement dated 27 February 2011 
                                      between Bidco and IMD relating, among 
                                      other things, to the implementation 
                                      of the Acquisition; 
 "Independent Directors"             David Haynes, Charles Dunstone, Martina 
                                      King, Charles Cox and Ian Stevenson; 
 "Independent IMD Shareholders"      IMD Shareholders other than the Executive 
                                      Managers; 
 "Independent Inconsistent                      (a) an offer, scheme or 
  Transaction"                                  arrangement, recapitalisation 
                                                or other transaction which 
                                                involves a change of control 
                                                (as defined in the City Code) 
                                                of IMD or any other member of 
                                                the IMD Group; or 
                                                (b) any arrangement or 
                                                transaction which involves or 
                                                contemplates the transfer of 
                                                any interest in the whole, or 
                                                the majority of the 
                                                undertaking, assets and/or 
                                                business of IMD or any other 
                                                member of the IMD Group; or 
                                                (c) any other arrangement or 
                                                transaction or series of the 
                                                same which is materially 
                                                inconsistent with or an 
                                                alternative to the 
                                                Acquisition; 
                                     which is in each case to be made or 
                                      entered into by or with a third party 
                                      which is not acting in concert (as 
                                      defined in the City Code) with Bidco; 
 "Independent Scheme Shareholders"   those Scheme Shareholders who are 
                                     Independent IMD Shareholders; 
 "Inducement Fee Agreement"          the letter agreement dated 22 December 
                                     2010 between IMD and Vitruvian Partners 
                                     containing provisions relating to 
                                     non-solicitation, the payment of an 
                                     inducement fee, irrevocable undertakings 
                                     and other matters in relation to the 
                                     Acquisition as amended by the letter 
                                     between IMD and Vitruvian Partners dated 
                                     25 February 2011; 
 "ISIN code"                         a UK international securities 
                                     identification number; 
 "Listing Rules"                     the listing rules of the Financial 
                                     Services Authority as amended from time 
                                     to time and contained in the Financial 
                                     Services Authority's publication of the 
                                     same name; 
 "London Stock Exchange"             London Stock Exchange plc; 
 "Management Arrangements"           the arrangements with the Executive 
                                     Managers, as described in this 
                                     announcement; 
 "Manco"                             DMWSL 658 Limited, a company incorporated 
                                      in England and Wales with registered 
                                      number 7479177; 
 "Midco"                             Lausanne Midco Limited, a company 
                                     incorporated in England and Wales with 
                                     registered number 7476070; 
 "Oakley Capital"                    Oakley Capital Limited, which is 
                                     authorised and regulated in the United 
                                     Kingdom by the Financial Services 
                                     Authority; 
 "Offer"                             should Bidco elect (with the consent of 
                                     the Panel) to make the Acquisition by way 
                                     of an offer at an offer price of not less 
                                     than 91 pence per IMD Share, the 
                                     recommended cash offer to be made by 
                                     Bidco to acquire all of the issued and to 
                                     be issued IMD Shares not already owned 
                                     (or contracted to be acquired) by Bidco 
                                     or its associates (including, where the 
                                     context so requires, any subsequent 
                                     revision, variation, extension or renewal 
                                     of such offer); 
 "Offer Document"                    should Bidco elect to make the 
                                     Acquisition by way of the Offer, the 
                                     document containing, amongst other 
                                     things, the details of the Offer, the 
                                     terms and conditions of the Offer and 
                                     certain information about IMD and Bidco 
                                     to be sent to IMD Shareholders and 
                                     others; 
 "Official List"                     the daily official list of the Financial 
                                      Services Authority; 
 "Panel"                             the Panel on Takeovers and Mergers; 
 "Reduction Court Order"             the order of the Court confirming the 
                                      Capital Reduction; 
 "Reduction Record Time"             the time and date specified as such in 
                                     the Scheme Document expected to be 6.00 
                                     p.m. on the Business Day immediately 
                                     preceding the date on which the Reduction 
                                     Court Order is made; 
 "Registrar"                         the Registrar of Companies in England 
                                      and Wales; 
 "Regulatory Information             means any of the services set out in 
  Service"                            Appendix 3 to the Listing Rules; 
 "Scheme"                            the proposed scheme of arrangement under 
                                     Part 26 of the Companies Act 2006 between 
                                     IMD and the Scheme Shareholders the full 
                                     terms of which will be set out in the 
                                     Scheme Document; 
 "Scheme Court Hearing"              the hearing by the Court of the claim 
                                      to sanction the Scheme; 
 "Scheme Court Order"                the order of the Court sanctioning the 
                                     Scheme under Part 26 of the Companies Act 
                                     2006; 
 "Scheme Document"                   the document to be sent to IMD 
                                     Shareholders and, for information only, 
                                     to participants in the IMD Share Schemes, 
                                     containing and setting out the Scheme and 
                                     the notices convening the Court Meeting 
                                     and the General Meeting; 
 "Scheme Shareholders"               holders of Scheme Shares; 
 "Scheme Shares"                     (i) the IMD Shares in issue at the 
                                      date of the Scheme Document; 
                                     (ii) any IMD Shares issued after the 
                                      date of the Scheme Document and before 
                                      the Voting Record Time; and 
                                     (iii) any IMD Shares issued at or after 
                                      the Voting Record Time and before the 
                                      Reduction Record Time, in respect of 
                                      which the original or any subsequent 
                                      holders thereof are, or shall have 
                                      agreed in writing to be, bound by the 
                                      Scheme, 
                                     in each case other than any IMD Shares 
                                      legally or beneficially owned by members 
                                      of the Bidco Group; 
 "Statement of Capital"              the statement of capital (approved by the 
                                     Court) showing with respect to IMD's 
                                     share capital, as altered by the 
                                     Reduction Court Order, the information 
                                     required by section 649 of the Companies 
                                     Act 2006; 
 "UK" or "United Kingdom"            the United Kingdom of Great Britain 
                                      and Northern Ireland; 
 "US", "USA" or "United States"      the United States of America, its 
                                     territories and possessions, any State of 
                                     the United States of America and the 
                                     District of Columbia; 
 "Vitruvian Funds"                   the Vitruvian Partnership I Fund, 
                                     comprising investment partnerships 
                                     advised by Vitruvian Partners; 
 "Vitruvian Partners"                Vitruvian Partners LLP; 
 "Voting Record Time"                the time and date specified in the 
                                      Scheme Document, reference to which 
                                      entitlement to vote on the Scheme will 
                                      be determined, expected to be 6:00 
                                      p.m. on the day which is two days before 
                                      the date of the Court Meeting or, if 
                                      such Court Meeting is adjourned, 6:00 
                                      p.m. on the day which is two days before 
                                      the day of such adjourned meeting; 
 "Wider Bidco Group"                 Bidco and its subsidiaries, subsidiary 
                                     undertakings, associated undertakings and 
                                     any other undertaking or joint venture or 
                                     firm or partnership or company in which 
                                     Bidco and/or such subsidiaries or 
                                     undertakings (aggregating their 
                                     interests) have a substantial interest; 
                                     and 
 "Wider IMD Group"                   IMD and its subsidiaries, subsidiary 
                                     undertakings, associated undertakings and 
                                     any other undertaking or joint venture or 
                                     firm or partnership or company in which 
                                     IMD and/or such subsidiaries or 
                                     undertakings (aggregating their 
                                     interests) have a substantial interest.

In this announcement references to GBP or pounds and p or pence are to pounds sterling and pence being the lawful currency of the United Kingdom.

For the purposes of this announcement:

-- "subsidiary", "holding company", "subsidiary undertaking", "parent undertaking", "undertaking" and "associated undertaking" have the respective meanings given thereto by the Companies Act 2006, but for this purpose ignoring paragraph 20(1)(b) of Schedule 4A of the Companies Act 1985; and

-- "substantial interest" means a direct or indirect interest in 10 per cent. or more of the equity share capital (as defined in the Companies Act 2006).

This information is provided by RNS

The company news service from the London Stock Exchange

END

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