Acquisition of TJH Financial Services

11 January 2011

The Innovation Group plc

("Innovation Group" or the "Company")

Acquisition of TJH Financial Services ("TJH")

Innovation Group today announces that its South African subsidiary, Innovation Group (Pty) Ltd ("Innovation Group SA"), has acquired a 70 per cent stake in TJH Financial Services (Pty) Ltd for a total cash consideration of ZAR 10.56m (£1m). TJH, which achieved a profit before tax of ZAR 2.6m (£0.2m) and revenue of ZAR 11.1m (£0.95m) in the year ended 30 September 2010 is an insurance administrator, providing underwriting administration as well as policy administration and claims handling services for insurers and brokers. This acquisition, which will be funded entirely by cash available in the South African business, broadens the policy and underwriting administration services available to our clients.

Commenting on the acquisition, Andy Roberts, CEO of Innovation Group said:

"TJH currently uses Innovation Group's technology to enable its Broker clients to write and manage policies more effectively and efficiently. Through combining our strengths, we can see enhanced potential for growth in this area for our South African business in 2012 and beyond."

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Notes to Editors:

The Innovation Group plc (LSE: TIG.L) is a global provider of business process outsourcing and software solutions to the insurance, fleet, automotive and property industries. Innovation Group provides contact centres, repair networks, process management, supply chain and technology operations and decision support analytics to support accident management, repair and estimation and claims management services. Innovation Group has over 800 global clients including AXA, RSA, American Modern Insurance Group, LeasePlan, The Ford Motor Company, Aviva, Toyota and Zurich. The Group processes more than 4 million claims per year with 20 per cent direct claims cost saving achieved. Innovation Group's 2,300 people are located in the United Kingdom, Australia, Belgium, Canada, France, Germany, Japan, India, Pakistan, South Africa, Spain and United States. www.innovation-group.com