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Offer by Daisy Intermediate Holdings Limited

21st Nov 2016 07:00

RNS Number : 6590P

Alternative Networks plc

21 November 2016

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

21 November 2016

RECOMMENDED CASH ACQUISITION

ALTERNATIVE NETWORKS PLC

DAISY INTERMEDIATE HOLDINGS LIMITED

to be effected

by way of a scheme of arrangementunder Part 26 of the Companies Act 2006

Summary

· The boards of Daisy Intermediate Holdings Limited ("Daisy") and Alternative Networks plc ("Alternative Networks" or the "Company") are pleased to announce that they have reached agreement on the terms of a recommended cash acquisition by Daisy of the entire issued and to be issued ordinary share capital of Alternative Networks (the "Acquisition"). It is intended that the Acquisition will be implemented by way of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act.

· Under the terms of the Acquisition, each Alternative Networks Shareholder will be entitled to receive:

335 pence in cash for each Alternative Networks Share

· The Acquisition values the entire issued and to be issued ordinary share capital of Alternative Networks at approximately £165.3 million on a fully diluted basis.

· The Acquisition Price represents a premium of approximately:

· 17 per cent. to the Closing Price of 285 pence per Alternative Networks Share on 18 November 2016 (being the last Business Day prior to the date of this Announcement); and

· 20 per cent. to the volume-weighted average price of 280 pence per Alternative Networks Share for the six months ended on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

· As part of its continuing corporate acquisition strategy, the Daisy Directors believe that Alternative Networks represents a strong, complementary fit with the Daisy Group's existing business and operations. The Acquisition will build upon Daisy's recent acquisitions of Damovo and Phoenix IT in the managed services segment and will further broaden and strengthen its mobile and fixed line product and service offerings. In addition, the Acquisition will further increase the Daisy Group's scale, providing efficiencies for the combined businesses as well as improved cross-selling opportunities.

· The Alternative Networks Directors, who have been so advised by Rothschild and Investec as to the financial terms of the Acquisition, consider the terms of the Acquisition to be fair and reasonable. In providing financial advice to the Alternative Networks Directors, Rothschild and Investec have taken into account the commercial assessments of the Alternative Networks Directors. Investec is providing independent financial advice to the Alternative Networks Directors for the purposes of Rule 3 of the Code.

· Accordingly, the Alternative Networks Directors intend to recommend unanimously that Alternative Networks Shareholders vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, accept, or procure acceptances of, such Takeover Offer), as all the Alternative Networks Directors who hold Alternative Networks Shares (in a personal capacity or through members of their immediate families, related trusts or a nominee or nominees) have irrevocably undertaken to do, or procure to be done, in respect of their own beneficial holdings (and the beneficial holdings of members of their immediate families or related trusts or nominee(s)) of 14,387,324 Alternative Networks Shares, in aggregate, representing approximately 28.9 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

· Daisy has also received irrevocable undertakings to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) from former Alternative Networks directors and founders (and their immediate families) (the "Alternative Networks Former Directors and Founders") in respect of 8,011,217 Alternative Networks Shares, in aggregate, representing approximately 16.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

· In addition to the irrevocable undertakings from the Alternative Networks Directors and the Alternative Networks Former Directors and Founders, Daisy has received letters of intent to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) from Herald Investment Management Limited and Octopus Investments Limited in respect of 6,019,387 Alternative Networks Shares, in aggregate, representing approximately 12.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

· Therefore, as at the date of this Announcement, Daisy has received irrevocable undertakings and letters of intent to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) with respect to a total of 28,417,928 Alternative Networks Shares, in aggregate, representing approximately 57.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

· Full details of the irrevocable undertakings and the letters of intent received by Daisy are set out in Appendix III to this Announcement.

· The cash consideration payable to Scheme Shareholders under the terms of the Acquisition will be funded from increases in the size of Daisy's existing senior facility and Daisy's existing PIK facility both of which are provided to Daisy by market debt finance providers.

· It is intended that the Acquisition will be implemented by way of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act (or, if Daisy elects and with the consent of the Takeover Panel, a Takeover Offer). The purpose of the Scheme is to provide for Daisy to become the owner of the entire issued and to be issued ordinary share capital of Alternative Networks (other than those Alternative Networks Shares held by the EBT at the Scheme Record Time). The Scheme will be put to Alternative Networks Shareholders at the Court Meeting and at the General Meeting. In order to become Effective, the Scheme must be approved by a majority in number of the Alternative Networks Shareholders voting at the Court Meeting, either in person or by proxy, representing at least 75 per cent. in value of the Scheme Shares voted. The Resolutions required to implement the Scheme must also be approved by the requisite majority of Alternative Networks Shareholders at the General Meeting.

· The Acquisition is subject to the Conditions and further terms set out in Appendix I to this Announcement and to be set out in the Scheme Document.

· Further details of the Acquisition will be contained in the Scheme Document which is intended to be posted to Alternative Networks Shareholders, and, for information only, to participants in the Alternative Networks Share Schemes, along with the notices of the Court Meeting and the General Meeting and the Forms of Proxy, within 28 days of the date of this Announcement, unless Daisy and Alternative Networks otherwise agree, and the Takeover Panel consents, to a later date. Subject to the Conditions and certain further terms set out in Appendix I to this Announcement, the Scheme is expected to become Effective by the end of 2016.

Commenting on the Acquisition, James Murray, Chairman of Alternative Networks, said:

"Alternative Networks has developed into a leading independent provider of end-to-end communication solutions and managed IT services to businesses in the UK. Through its impressive track record of growth, Alternative Networks has also delivered significant value accretion for the Alternative Networks Shareholders. I am proud to have been part of this successful story since the Company's founding and I would like to thank all employees and staff for their tremendous contribution over the years.

Today, Alternative Networks faces rising demand from customers to procure, manage and support the complete chain of enterprise IT and communication solutions. The combination with Daisy will ensure that the Company is best placed to capitalise on future growth opportunities and remain the provider of choice for our customers. In particular, the strong complementarity and strategic fit between Daisy and Alternative Networks will ensure our competitiveness and benefit our customers through access to a broader range of unified communications solutions".

Commenting on the Acquisition, Neil Muller, Chief Executive Officer of Daisy, said:

"This announcement builds upon Daisy's successful acquisition strategy, to enable our customers to take advantage of digital technology in a converging world of business communications and IT.

Alternative Networks is one of the largest independent providers of IT managed services and business-to-business communications in the UK and represents a strong and complementary strategic fit with the Daisy Group's existing business and operations. Having respected Alternative Networks for many years, we look forward to further enhancing our capability and scale across our chosen markets and we believe the combined group will be well positioned to increase its market share further and to continue to be the provider of choice for its customers and partners."

This summary should be read in conjunction with, and is subject to, the full text of this Announcement and its Appendices. In particular, the Acquisition is subject to the Conditions and further terms as set out in Appendix I (and the full terms and conditions to be set out in the Scheme Document). Appendix II contains details of sources of information and bases of calculation contained in this Announcement. Appendix III contains certain details relating to the irrevocable undertakings referred to in this Announcement. Appendix IV contains definitions of certain terms used in this Announcement.

Enquiries:

Media enquiries for Daisy

Simon Wright Tel: +44 (0) 747 122 8228

Oakley Advisory Limited (Financial adviser to Daisy)

Chris Godsmark Tel: +44 (0) 20 7766 6900Zishaan Arshad Marc Jones

Alternative Networks

Gavin Griggs Tel: +44 (0) 870 190 7444

Investec Bank plc (Rule 3 adviser, nominated adviser and joint corporate broker to Alternative Networks)

Patrick Robb Tel: +44 (0) 20 7597 5000

Andrew Pinder

Carlton Nelson

N M Rothschild & Sons Limited (Financial adviser to Alternative Networks)

Warner Mandel Tel: +44 (0) 20 7280 5000

Stephan Bocklet

finnCap Limited (Joint corporate broker to Alternative Networks)

Stuart Andrews Tel: +44 (0) 20 7220 0565

Bell Pottinger Financial & Corporate (Public relations adviser to Alternative Networks)

Elly Williamson Tel: +44 (0) 20 3772 2500

Anna Legge

Oakley Advisory Limited ("Oakley"), an Appointed Representative of Oakley Capital Limited, which is authorised and regulated by the Financial Conduct Authority ("FCA") in the United Kingdom, is acting exclusively for Daisy and for no one else in connection with the matters set out in this Announcement and will not regard any other person as its client in relation to the matters referred to in this Announcement and will not be responsible to anyone other than Daisy for providing the protections afforded to clients of Oakley nor for providing advice in relation to the Acquisition or any other matter or arrangement referred to in this Announcement.

Investec Bank plc ("Investec"), which is authorised by the Prudential Regulation Authority ("PRA") and regulated in the United Kingdom by the FCA and the PRA, is acting exclusively for Alternative Networks and for no one else in connection with the matters set out in this Announcement and will not regard any other person as its client in relation to the matters referred to in this Announcement and will not be responsible to anyone other than Alternative Networks for providing the protections afforded to clients of Investec nor for providing advice in relation to the Acquisition or any other matter or arrangement referred to in this Announcement.

N M Rothschild & Sons Limited ("Rothschild"), which is authorised and regulated in the United Kingdom by the FCA, is acting exclusively for Alternative Networks and for no one else in connection with the Acquisition and the contents of this Announcement and will not regard any other person as its client in relation to the matters referred to in this Announcement and will not be responsible to anyone other than Alternative Networks for providing the protections afforded to clients of Rothschild, or for providing advice in relation to the Acquisition, the contents of this Announcement or any other matters referred to herein.

finnCap Limited ("finnCap"), which is authorised and regulated by the FCA in the United Kingdom, is acting exclusively for Alternative Networks and for no one else in connection with the matters set out in this Announcement and will not regard any other person as its client in relation to the matters referred to in this Announcement and will not be responsible to anyone other than Alternative Networks for providing the protections afforded to clients of finnCap nor for providing advice in relation to the Acquisition or any other matter or arrangement referred to in this Announcement.

This Announcement is for information purposes only and is not intended to and does not constitute, or form any part of, an offer to sell or subscribe for or any invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Acquisition or otherwise. The Acquisition will be made solely through the Scheme Document and the accompanying Forms of Proxy, which will contain the full terms and conditions of the Acquisition and the Scheme, including details of how to vote in respect of the Acquisition and the Scheme. Any approval, decision or other response to the Acquisition and/or the Scheme should be made only on the basis of the information in the Scheme Document. Scheme Shareholders are strongly advised to read the formal documentation in relation to the Acquisition and the Scheme once it has been dispatched.

This Announcement has been prepared for the purpose of complying with English law, the Code and the AIM Rules and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions outside the United Kingdom.

The statements contained in this Announcement are made as at the date of this Announcement, unless some other time is specified in relation to them, and service of this Announcement shall not give rise to any implication that there has been no change in the facts set out in this Announcement since such date.

Overseas shareholders

The laws of certain jurisdictions may affect the availability of the Acquisition to persons who are not resident in the United Kingdom. Persons who are not resident in the United Kingdom, or who are subject to laws of any jurisdiction other than the United Kingdom, should inform themselves about, and observe, any applicable requirements. Any person (including, without limitation, nominees, trustees and custodians) who would, or otherwise intends to, forward this Announcement, the Scheme Document or any accompanying document to any jurisdiction outside the United Kingdom should refrain from doing so and seek appropriate professional advice before taking any action. In particular, the ability of persons who are not resident in the United Kingdom to vote their Alternative Networks Shares at the Court Meeting and/or the General Meeting, or to execute and deliver Forms of Proxy appointing another to vote their Alternative Networks Shares in respect of the Court Meeting and/or the General Meeting on their behalf, may be affected by the laws of the relevant jurisdiction in which they are located.

Any failure to comply with applicable legal or regulatory requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. To the fullest extent permitted by applicable law, the companies and persons involved in the Acquisition disclaim any responsibility and liability for the violation of such restrictions by any person.

The Acquisition will not be made, directly or indirectly, in or into or by use of the mails or any other means or instrumentality (including, without limitation, telephonic or electronic) of interstate or foreign commerce of, or any facility of a national, state or other securities exchange of, a Restricted Jurisdiction, and no person may vote in favour of the Acquisition by any such use, means, instrumentality or facility or from within a Restricted Jurisdiction. Accordingly, copies of this Announcement and formal documentation relating to the Acquisition are not being, and must not be, directly or indirectly, mailed or otherwise forwarded or distributed in, into or from a Restricted Jurisdiction and persons receiving this Announcement (including custodians, nominees and trustees) must not distribute or send it in, into or from a Restricted Jurisdiction. In the event that the Acquisition is implemented by way of a Takeover Offer and extended into the US, Daisy will do so in satisfaction of the procedural and filing requirements of the US securities laws at that time, to the extent applicable thereto. The Acquisition relates to the shares of an English company and it is proposed to be made by means of a scheme of arrangement provided for under the laws of England and Wales. The Scheme will relate to the shares of an English company that is a "foreign private issuer" as defined under Rule 3b-4 under the US Exchange Act. A transaction effected by means of a scheme of arrangement is not subject to the shareholder vote, proxy solicitation and tender offer rules under the Exchange Act. Accordingly, the Scheme will be subject to the disclosure requirements and practices applicable in the UK to schemes of arrangement, which differ from the disclosure requirements and practices of US shareholder vote, proxy solicitation and tender offer rules. Financial information included in the relevant documentation will have been prepared in accordance with accounting standards applicable in the UK and may not be comparable to the financial statements of US companies. However, if Daisy were to elect to implement the Acquisition by means of a Takeover Offer, such Takeover Offer will be made in compliance with all applicable laws and regulations, including Section 14(e) of the Exchange Act and Regulation 14E thereunder. Such Takeover Offer would be made in the US by Daisy and no one else. In addition to any such Takeover Offer, Daisy, certain affiliated companies and the nominees or brokers (acting as agents) may make certain purchases of, or arrangements to purchase, shares in Alternative Networks outside such Takeover Offer during the period in which such Takeover Offer would remain open for acceptance. If such purchases or arrangements to purchase are made, they would be made outside the United States in compliance with applicable law, including the Exchange Act.

Forward-looking statements

This Announcement may contain certain "forward-looking statements" with respect to Daisy, the Daisy Group, Alternative Networks and/or the Alternative Networks Group. 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 words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could" or other words or terms of similar meaning or the negative thereof. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of the Daisy Group or the Alternative Networks Group and potential synergies resulting from the Acquisition; and (iii) the expected timing and scope of the Acquisition.

These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or developments to differ materially from those expressed in, or implied by, such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding present and future strategies and environments. You are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. All subsequent oral or written forward-looking statements attributable to Daisy or Alternative Networks or any person acting on their behalf are expressly qualified in their entirety by the cautionary statement above. Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this Announcement. Daisy and Alternative Networks assume no obligation to update publicly or revise forward-looking or other statements contained in this Announcement, whether as a result of new information, future events or otherwise, except to the extent legally required.

No profit forecasts or estimates

No statement in this Announcement is intended as a profit forecast or profit estimate for any period and no statement in this Announcement should be interpreted to mean that earnings or earnings per ordinary share for Alternative Networks for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per ordinary share for Alternative Networks.

Right to switch to a Takeover Offer

Daisy reserves the right to elect, with the consent of the Takeover Panel, to implement the Acquisition by way of a Takeover Offer for the entire issued and to be issued ordinary share capital of Alternative Networks as an alternative to the Scheme. In such an event, the Takeover Offer will be implemented on the same terms or, if Daisy so decides (with the consent of the Takeover Panel), on such other terms being no less favourable (subject to appropriate amendments), so far as applicable, as those which would apply to the Scheme and subject to the amendment referred to in Appendix I to this Announcement.

Publication on website and availability of hard copies

In accordance with Rule 26.1 of the Code, a copy of this Announcement will be made available (subject to certain restrictions relating to persons resident in Restricted Jurisdictions), free of charge, on Daisy's website at https://daisygroup.com/recommendedacquisition and Alternative Networks' website at www.alternativenetworks.com/investors/ by no later than 12:00 noon on the Business Day following this Announcement. Neither the contents of these websites nor the content of any other website accessible from hyperlinks on such websites is incorporated into, or forms part of, this Announcement.

In accordance with Rule 30.3 of the Code, a person so entitled may request a hard copy of this Announcement, free of charge, by contacting Oakley on +44 (0) 20 7766 6900 or Investec on +44 (0) 20 7597 5000. For persons who receive a copy of this Announcement in electronic form or via a website notification, a hard copy of this Announcement will not be sent unless so requested. In accordance with Rule 30.3 of the Code, a person so entitled may also request that all future documents, announcements and information to be sent to them in relation to the Acquisition should be in hard copy form.

Information relating to Alternative Networks Shareholders

Please be aware that addresses, electronic addresses and certain information provided by Alternative Networks Shareholders, persons with information rights and other relevant persons for the receipt of communications from Alternative Networks may be provided to Daisy during the Offer Period as required under Section 4 of Appendix 4 of the Code to comply with Rule 2.11(c) of the Code.

Rounding

Certain figures included in this Announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1 per cent. or more of any class of relevant securities of an offeree company or of any securities exchange 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 securities exchange 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 securities exchange 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 pm on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm on the 10th Business Day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the 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 securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange 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 securities exchange 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 pm 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 securities exchange 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 Rules 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. You should contact the Takeover Panel's Market Surveillance Unit on +44 (0) 20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Rule 2.9 disclosure

In accordance with Rule 2.9 of the Code, Alternative Networks confirms that, as at the close of business on 18 November 2016, being the last Business Day prior to the date of this Announcement, it had 49,759,741 ordinary shares of 0.125 pence each in issue and admitted to trading on AIM under ISIN reference GB00B05KXX82.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

21 November 2016

RECOMMENDED CASH ACQUISITION

ALTERNATIVE NETWORKS PLC

DAISY INTERMEDIATE HOLDINGS LIMITED

to be effected

by way of a scheme of arrangementunder Part 26 of the Companies Act 2006

1. Introduction

The boards of Daisy Intermediate Holdings Limited ("Daisy") and Alternative Networks plc ("Alternative Networks" or the "Company") are pleased to announce that they have reached agreement on the terms of a recommended cash acquisition by Daisy of the entire issued and to be issued ordinary share capital of Alternative Networks (the "Acquisition"). It is intended that the Acquisition will be implemented by way of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act.

2. The Acquisition

The Acquisition, which will be on the terms and subject to the Conditions set out below and in Appendix I to this Announcement, and to be set out in the Scheme Document, will be made on the following basis:

335 pence in cash for each Alternative Networks Share

The Acquisition values the entire issued and to be issued ordinary share capital of Alternative Networks at approximately £165.3 million on a fully diluted basis.

The Acquisition Price represents a premium of approximately:

· 17 per cent. to the Closing Price of 285 pence per Alternative Networks Share on 18 November 2016 (being the last Business Day prior to the date of this Announcement); and

The Acquisition is conditional, amongst other things, on the Scheme becoming Effective no later than the Long Stop Date.

The Alternative Networks Shares will be acquired by Daisy with full title guarantee, fully paid and free from all liens, equitable interests, charges, encumbrances, rights of pre-emption and any other third party rights or interests whatsoever and together with all rights existing at the date of this Announcement or thereafter attaching thereto, including (without limitation) the right to receive and retain, in full, all dividends and other distributions (if any) declared, made or paid or any other return of capital (whether by way of reduction of share capital or share premium account or otherwise) made on or after the date of this Announcement in respect of the Alternative Networks Shares.

If any dividend or other distribution in respect of the Alternative Networks Shares is declared, paid or made on or after the date of this Announcement, Daisy reserves the right to reduce the consideration payable for each Alternative Networks Share under the terms of the Acquisition by the amount per Alternative Networks Share of such dividend or distribution although, in such circumstances, Alternative Networks Shareholders would be entitled to retain any such dividend or distribution declared, made or paid.

3. Recommendation

The Alternative Networks Directors, who have been so advised by Rothschild and Investec as to the financial terms of the Acquisition, consider the terms of the Acquisition to be fair and reasonable. In providing financial advice to the Alternative Networks Directors, Rothschild and Investec have taken into account the commercial assessments of the Alternative Networks Directors. Investec is providing independent financial advice to the Alternative Networks Directors for the purposes of Rule 3 of the Code.

Accordingly, the Alternative Networks Directors intend to recommend unanimously that Alternative Networks Shareholders vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, accept, or procure acceptances of, such Takeover Offer), as all the Alternative Networks Directors who hold Alternative Networks Shares (in a personal capacity or through members of their immediate families, related trusts or a nominee or nominees) have irrevocably undertaken to do, or procure to be done, in respect of their own beneficial holdings (and the beneficial holdings of members of their immediate families or related trusts or nominee(s)) of 14,387,324 Alternative Networks Shares, in aggregate, representing approximately 28.9 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

In addition, former Alternative Networks Directors and founders (and their immediate families) (the "Alternative Networks Former Directors and Founders") have irrevocably undertaken to Daisy to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) in respect of 8,011,217 Alternative Networks Shares, in aggregate, representing approximately 16.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

4. Background to, and reasons for, the Acquisition

The Daisy Group is an independent UK provider of end-to-end business technology and communications solutions to small-to-medium and mid-market businesses. It offers a comprehensive range of products and services comprising fixed line voice and mobile telephony, data connectivity, device and datacentre support, business continuity and associated cloud, hosting and managed services.

The Daisy Group has successfully executed, and continues to follow, a corporate acquisition strategy which has created its diverse and well-balanced product portfolio, in order to meet the evolving needs of its customers and partners.

Alternative Networks is a leading provider of ICT solutions to UK businesses from device to datacentre, delivering products and services spanning cloud computing, virtualisation, managed hosting, fixed line voice, software development, mobile, systems, IP networks and complex billing solutions.

As part of its continuing corporate acquisition strategy, the Daisy Directors believe that Alternative Networks represents a strong, complementary fit with the Daisy Group's existing business and operations. The Acquisition will build upon Daisy's recent acquisitions of Damovo and Phoenix IT in the managed services segment and will further broaden and strengthen its mobile and fixed line product and service offerings. In addition, the Acquisition will further increase the Daisy Group's scale, providing efficiencies for the combined businesses as well as improved cross-selling opportunities.

5. Background to, and reasons for, the recommendation

The Alternative Networks Directors have evaluated the terms of the Acquisition on behalf of Alternative Networks Shareholders as a whole and, as a board, have held discussions with Daisy regarding those terms. These discussions have resulted in the Acquisition being proposed to be made at an Acquisition Price of 335 pence in cash for each Alternative Networks Share.

Since it was founded, Alternative Networks has achieved an impressive track record of growth and has delivered significant value accretion for Alternative Networks Shareholders. From a background in fixed line telecoms and then in mobile telecoms, more recently Alternative Networks has become a leading provider of ICT solutions to small and medium-sized businesses in the UK with a strong customer proposition including a range of services covering the full value chain from device to datacentre.

While the Alternative Networks Directors believe that the outlook for Alternative Networks and its growth prospects remain positive, its growth strategy is subject to execution risk and changes in the market environment. The Alternative Networks Directors have noted that total operator-reported and business telecoms revenue in the UK Telecommunications and Networks industry has declined since 2010 (Source: Ofcom, The Communications Market Report, 4th August 2016, p.139 and p.158). In this context, the mobile tariff reset referred to in Alternative Networks' trading update released on 24 February 2016 and the uncertainty caused by the outcome of the referendum on the United Kingdom's continued membership of the European Union held on 23 June 2016 (the "Referendum") were unwelcome developments. As the Referendum is still relatively recent, the potential longer term impact on Alternative Networks' future trading performance is unclear.

Alternative Networks' dividend payments and dividend policy have been an important part of its investment case and, lately, have contributed to the support for its share price. While the Board reiterated its intention to deliver annual growth in Alternative Networks' dividend of no less than 10 per cent. in the recent trading update released on 27 September 2016, the Alternative Networks Directors also believe that, in the longer term, any growth in dividends will need to reflect the growth in Alternative Networks' underlying profits.

The Alternative Networks Directors have also noted several recent transactions between managed service providers in the UK enterprise ICT solutions industry and have assessed the potential relative merits and likelihood of, in theory, combining with other businesses, while also recognising the constraints for Alternative Networks Shareholders resulting from the relative trading illiquidity of the Alternative Networks Shares as the Alternative Networks Directors and the Alternative Networks Former Directors and Founders still hold nearly 50 per cent. of Alternative Networks' issued ordinary share capital.

The Alternative Networks Directors, who have discussed the Acquisition extensively with, and taken advice from, Alternative Networks' advisers, have concluded unanimously that the Acquisition provides Alternative Networks Shareholders with an attractive opportunity to realise value from their investment in cash immediately and at a premium of 20 per cent. to the volume-weighted average price of 280 pence per Alternative Networks Share for the six month period ended on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

Taking the above considerations into account, the Alternative Networks Directors believe that the Acquisition is in the best interests of Alternative Networks Shareholders, as a whole, and intend unanimously to recommend that Scheme Shareholders vote in favour of the Scheme at the Court Meeting and that Alternative Networks Shareholders vote in favour of the Resolutions to be proposed at the General Meeting, as the Alternative Networks Directors have irrevocably undertaken to do, or procure to be done, in respect of their own beneficial holdings (and the beneficial holdings of members of their immediate families or related trusts) of Alternative Networks Shares.

6. Irrevocable undertakings and letters of intent

Daisy has received irrevocable undertakings to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if Daisy, with the consent of the Takeover Panel, exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) from all of the Alternative Networks Directors who hold Alternative Networks Shares (in a personal capacity or through members of their immediate families, related trusts or a nominee or nominees) in respect of their entire beneficial holdings (and the beneficial holdings of members of their immediate families or related trusts or nominee(s)) of Alternative Networks Shares, amounting to 14,387,324 Alternative Networks Shares, in aggregate, representing approximately 28.9 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

Daisy has also received irrevocable undertakings to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) from the Alternative Networks Former Directors and Founders in respect of 8,011,217 Alternative Networks Shares, in aggregate, representing approximately 16.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

In addition to the irrevocable undertakings from the Alternative Networks Directors and the Alternative Networks Former Directors and Founders, Daisy has received letters of intent to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) from Herald Investment Management Limited and Octopus Investments Limited in respect of 6,019,387 Alternative Networks Shares, in aggregate, representing approximately 12.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

Therefore, as at the date of this Announcement, Daisy has received irrevocable undertakings and letters of intent to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) with respect to a total of 28,417,928 Alternative Networks Shares, in aggregate, representing approximately 57.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

Full details of the irrevocable undertakings and the letters of intent received by Daisy are set out in Appendix III to this Announcement.

7. Information on the Daisy Group and Daisy

Daisy is an independent UK provider of end-to-end business technology and communications solutions to small-to-medium and mid-market businesses. It offers a comprehensive range of products and services through its three operating segments: SMB, Corporate and Partner Services. SMB provides packaged products to small-to-medium sized businesses with up to 500 employees. Corporate provides a comprehensive range of ICT solutions, professional services and managed services to medium-to-large enterprises with between 500 and 2,000 employees. Partner Services provides services to medium-to-large enterprises with 2,000 or more employees via its partner network of system integrators and large solutions and services providers.

The Daisy Group offers services to its customers across the following twelve product areas: business continuity, connectivity, lines and calls, mobile, WiFi, managed services, security, local area networks, contact centres, unified communications and collaboration, supply chain services and cloud and hosting.

8. Information on Alternative Networks

Alternative Networks provides IT and telecommunications solutions to businesses, covering the full spectrum of products and services from device to datacentre. Alternative Networks' products and services, offered across its three divisions, Advanced Solutions, Mobile and Fixed Line, include cloud computing, virtualisation, managed hosting, fixed line voice, mobile, systems, IP networks and complex billing software solutions.

Alternative Networks possesses close working relationships with a significant number of the world's leading product and service vendors, providing customers with access to the latest technologies.

Alternative Networks' Advanced Solutions portfolio has been designed to deliver flexibility and choice to customers. The business delivers IT and Voice solutions via on premise, hybrid cloud and cloud delivery models. The portfolio is designed to integrate public, private and hybrid cloud solutions unifying the distributed environments through unique web-based management tools providing visibility and control through orchestration, monitoring and correlation of customer data, to provide meaningful management information. Services offered include IP Networking (LAN, WLAN, Security), Co-Location, Unified Communications, Managed IT Services (Storage, Compute, Virtualisation), Unified Communications, Application Virtualisation and Wide Area Networks.

Within its Mobile division, Alternative Networks offers an extensive range of mobile workspace solutions, enabling companies to enhance their employee productivity through the provision of mobile networks, smartphones, mobile desktop access, application management, e-mail, data and security. Alternative Networks has commercial arrangements with Vodafone and O2, as well as strong relationships with a majority of major handset and tablet manufacturers.

Alternative Networks' Fixed Line division provides a range of fixed line telephony services that allow customers to deliver business critical services and provide migration paths to services in the future. Its fixed voice partners include BT Openreach, Vodafone and Gamma.

Alternative Networks is aligned to the business outcomes its customers desire. Each solution is designed with the customer in mind, with full visibility and control at all times and underpinned by end-to-end accountability. Alternative Networks supports a wide variety of customers, from legal, professional and financial services, healthcare, higher education and multi-national operations to mission-critical public services, all of which rely on effective and dependable technology.

9. Alternative Networks Share Schemes

Participants in the Alternative Networks Share Schemes will be contacted regarding the effect of the Acquisition and the Scheme on their rights under the Alternative Networks Share Schemes and appropriate proposals will be made to such participants in due course.

10. Financing

The cash consideration payable to Scheme Shareholders under the terms of the Acquisition will be funded from increases in the size of Daisy's existing senior facility (the "Senior Facility") and Daisy's existing PIK facility (the "PIK Facility") both of which are provided to Daisy by market debt finance providers.

Upon completion of the debt increase, Daisy's debt facilities will consist of, in aggregate, £377 million of senior term loans and a £40 million revolving loan facility, a £22 million second lien facility and a £289 million PIK Facility. The additional debt under the Senior Facility and the PIK Facility will be available to Daisy pursuant to amendments and restatements of the applicable existing facilities agreements and which, in the case of the additional debt under the Senior Facility is being provided by certain funds and/or managed accounts managed and/or advised by HPS Investment Partners, LLC or a subsidiary thereof and in the case of the additional debt under the PIK Facility is being provided by certain funds advised by Ares Capital.

Oakley, as financial adviser to Daisy, is satisfied that sufficient cash resources are available to Daisy to enable it to satisfy, in full, the consideration payable to Alternative Networks Shareholders under the terms of the Acquisition.

11. Management, employees and locations of the Alternative Networks Group

Daisy attaches great importance to the skills, knowledge and expertise of Alternative Networks' existing management and employees. Daisy confirms that it intends to safeguard fully the existing employment and pension rights of all Alternative Networks management and employees in accordance with applicable law and to comply with Alternative Networks' pension obligations for existing employees and members of Alternative Networks' pension schemes.

The Daisy Directors recognise that, in order to achieve the expected benefits of the Acquisition, operational and administrative restructuring will be required following completion to enable the Alternative Networks and Daisy businesses to be integrated. Daisy has not yet had any discussions with Alternative Networks regarding the integration of Alternative Networks and Daisy's business and therefore Daisy has not made any decisions about how such integration should be carried out. After the Scheme becomes effective, Daisy intends to carry out a detailed integration review of Alternative Networks' business in order to determine the best way to integrate Alternative Networks' and Daisy's businesses. It is anticipated that the integration review will identify overlapping functions and, following the review, integration decisions will be taken which are likely to involve some headcount reduction in these and other areas and, potentially, site closure(s), although any specific roles and any site(s) have not yet been identified. Finalisation of the integration plan will be subject to engagement with appropriate stakeholders, including employee representative bodies and unions.

Save as referred to above and subject to finalisation of the integration plan, Daisy confirms that it has no plans currently to: (i) change the principal locations of Alternative Networks' business; or (ii) redeploy any of Alternative Networks' fixed assets.

It is expected that each of the Alternative Networks Directors will cease to be directors of Alternative Networks on the Effective Date.

12. Current trading and outlook

On 8 June 2016, Alternative Networks announced its interim results for the six months ended 31 March 2016, an extract from which relating to Alternative Networks' trading and outlook at the time of the announcement is set out below:

"There have been market challenges to our Mobile business, over the past six months. However, we have remained competitive, have continued to improve our offering to customers and win new customers. We have taken measures to mitigate the financial impact of changes to roaming tariffs and maintained our focus on becoming one of the UK's leading providers of IT managed services to UK businesses. There are plenty of indicators to give us cause for optimism about the relevance and appeal of our offer and we will continue to drive organic growth. Our increase in the dividend reflects this confidence in the business and its cash generative nature.

Outlook

With changes to Mobile tariffs and carrier arrangements now in place, we have greater confidence on Mobile performance for the second half. Our high level of backlog also gives us a good indication of the level of non-recurring revenue we can expect in Advanced Solutions, and we continue to develop our offer to attract further new recurring revenues from mid-sized businesses, while controlling our cost base as we have done in the first half. As a consequence, we expect a higher weighting of revenue to the second half than has been the case in previous years."

On 27 September 2016, Alternative Networks issued a pre-close trading update for the year ending 30 September 2016, which is set out below and includes information relating to Alternative Networks' current trading and outlook:

"Alternative Networks plc ("the Group"), the UK business IT and communications service provider, today issues the following pre-close trading update for the year ending 30 September 2016. The highlights were:

· Advanced Solutions' new business performance was lower over the summer following the United Kingdom's European Union membership referendum. Reassuringly, new business performance recovered well in August and September and the Group has a robust pipeline for the coming financial year, but some project completions will be delayed beyond the year end;

· Mobile underlying performance has stabilised, and with the actions taken to offset the impact of new tariffs on roaming rates, a higher gross margin has been attained in the second half;

· Strong levels of operating cash conversion continued in the financial year; and

· As indicated with the interim results, the Board remains committed to paying a final dividend no less than 10% up year on year.

The Board now expect an Adjusted EBITDA* for the year ending 30 September 2016 somewhat below management's previous expectations.

Trading performance

Advanced Solutions

New recurring business has recovered to normal levels late in the half and the Group has signed some notable contracts with new and existing clients. As a result, the level of recurring revenue for the full year is expected to be in line with the prior year. The level of non-recurring new business has also recovered, but the delays we experienced have put pressure on project completions in the fourth quarter of the financial year, such that non-recurring revenue is expected to be below the levels reported in the prior financial year.

Mobile

Performance has stabilised following the roaming tariff effects seen in the first half of the year. We expect revenue in the second half of the year to be broadly in line with the level seen in the first half but with improved gross margin levels as a consequence of actions taken including new carrier arrangements, resulting in improved gross profits and margins. ARPU performance is expected to be broadly in line with the first half.

Fixed Voice

The overall performance of Fixed Voice was in line with both the market and our expectations. Line rental revenues continue to decrease in line with recent trends and we have seen improved margins with new commercial agreements.

Group

Trading in the financial year ending 30 September 2016 has been impacted by two unforeseen events, being the mobile roaming tariff reset and the uncertainty caused by the referendum. As the referendum is still relatively recent, the potential longer term impact on the Group's future trading performance is unclear. However, the Group remains in a strong financial position with recurring revenues comprising over 75% of sales, and continued robust cash generation which supports the progressive dividend policy.

Mark Quartermaine, CEO, said:

"We are disappointed to have seen business uncertainty over the summer in the wake of the EU referendum impact our Advanced Solutions business, but the pick-up in new business after the summer reassures us that our business remains well positioned to benefit from long term trends. We will update the market in more detail at the time of our full year results."

Preliminary Results

The results for the full year ending 30 September 2016 are expected to be announced on Thursday 8 December 2016.

*Adjusted EBITDA is stated before intangible asset amortisation excluding software, exceptional items and share based payments."

13. Acquisition-related arrangements

Confidentiality Agreement

Daisy and Alternative Networks entered into a confidentiality agreement dated 8 April 2016 (the "Confidentiality Agreement") pursuant to which Daisy has undertaken to keep confidential information relating to the Acquisition and the Alternative Networks Group and not to disclose it to third parties, except (i) to its directors, employees and advisers or agents or potential providers of finance; or (ii) if required to do so by applicable law or regulation (including the Code) or by the Takeover Panel, any court of competent jurisdiction, any governmental agency or by the regulations of any recognised stock exchange or other regulatory body.

Pursuant to the Confidentiality Agreement, Daisy undertook (save in certain circumstances), for a period of the longer of 12 months from the date of the Confidentiality Agreement and any further period during which discussions were continuing between Daisy and Alternative Networks concerning a possible offer for Alternative Networks, not to solicit or endeavour to solicit for employment any of Alternative Networks' statutory directors or the Alternative Networks Group's employees with whom Daisy had dealings during the course of discussions concerning the possible offer provided that Daisy had received written notification from Alternative Networks of the names of such persons as being persons falling within this restriction.

In addition, Daisy agreed to a standstill in relation to the securities of Alternative Networks for a period of six months from the date of the Confidentiality Agreement that applies other than, inter alia, in connection with the announcement of a recommended offer for the all or part of the share capital of Alternative Networks.

Save as referred to above, the confidentiality obligations shall remain in force from the date of the Confidentiality Agreement for a period of 24 months.

14. Structure of the Acquisition

Scheme

It is intended that the Acquisition will be effected by a Court-sanctioned scheme of arrangement between Alternative Networks and the Scheme Shareholders under Part 26 of the Companies Act.

The purpose of the Scheme is to provide for Daisy to become the owner of the entire issued and to be issued ordinary share capital of Alternative Networks (other than those Alternative Networks Shares held by the EBT at the Scheme Record Time). Under the Scheme, the Acquisition is to be achieved by the:

· transfer of the Scheme Shares held by Scheme Shareholders to Daisy in consideration for which the Scheme Shareholders will receive cash consideration on the basis set out in paragraph 2 (The Acquisition) of this Announcement; and

· passing of the Resolutions at the General Meeting (including amendments to Alternative Networks' articles of association to ensure that any Alternative Networks Shares issued between approval of the Scheme at the Court Meeting and the Scheme Record Time will be subject to the Scheme and that any Alternative Networks Shares issued after the Scheme Record Time will automatically be acquired by Daisy).

Approval by Court Meeting and General Meeting

In order to become Effective, the Scheme requires the:

(a) satisfaction (or, where applicable, waiver) of the Conditions;

(b) approval of a majority in number of the Scheme Shareholders who vote, representing not less than 75 per cent. in value of the Scheme Shares voted, either in person or by proxy, at the Court Meeting; and

(c) approval by the requisite majority of the Resolutions at the General Meeting (to be held directly after the Court Meeting) necessary in order to implement the Scheme.

Application to Court to sanction the Scheme

Once the requisite approvals have been obtained at the Court Meeting and the General Meeting and the other Conditions have been satisfied or (where applicable) waived, the Scheme must be sanctioned by the Court at the Court Hearing.

The Scheme will become Effective in accordance with its terms on delivery of the Court Order to the Registrar of Companies. Upon the Scheme becoming Effective, it will be binding on all Scheme Shareholders, irrespective of whether or not they attended and/or voted at the Court Meeting or General Meeting, or whether they voted in favour of, or against, the Scheme.

Full details of the Scheme to be set out in the Scheme Document

The Scheme will be subject to the satisfaction (or, where applicable, waiver) of the Conditions and the full terms and conditions to be set out in the Scheme Document. Further details of the Scheme will be set out in the Scheme Document, including the expected timetable and the action to be taken by Scheme Shareholders.

The Scheme will be governed by the laws of England and Wales. The Scheme will be subject to the applicable requirements of the Code, the Takeover Panel, the London Stock Exchange, the FCA and the AIM Rules.

If the Scheme does not become effective on or before the Long Stop Date (or such later date as Daisy and Alternative Networks may, with the consent of the Takeover Panel and, if required, the Court, agree) it will lapse and the Acquisition will not proceed (unless the Takeover Panel otherwise consents).

It is expected that the Scheme Document will be posted to Alternative Networks Shareholders, and, for information only, to participants in the Alternative Networks Share Schemes, along with the notices of the Court Meeting and the General Meeting and the Forms of Proxy, within 28 days of the date of this Announcement, unless Daisy and Alternative Networks otherwise agree, and the Takeover Panel consents, to a later date.

Conditions to the Acquisition

The Acquisition will be subject to the Conditions and further terms set out in Appendix I to this Announcement and to be set out in the Scheme Document.

The Scheme will be conditional, amongst other things, upon:

(a) the approval of the Scheme by a majority in number representing not less than 75 per cent. in value of the Scheme Shareholders entitled to vote and present and voting, either in person or by proxy, at the Court Meeting or at any adjournment, postponement or reconvention of such meeting to be held on or before the 22nd day after the expected date of the Court Meeting to be set out in the Scheme Document in due course (or such later date as may be agreed between Daisy and Alternative Networks and the Court may allow);

(b) the passing of the Resolutions by the requisite majority at the General Meeting or at any adjournment, postponement or reconvention of that meeting to be held on or before the 22nd day after the expected date of the General Meeting to be set out in the Scheme Document (or such later date, if any, as Daisy and Alternative Networks may agree and the Court may allow); and

(c) the sanction of the Scheme on or before the 22nd day after the expected date of the Court Hearing to be set out in the Scheme Document in due course (or such later date as may be agreed between Daisy and Alternative Networks and the Court may allow) and the delivery of an office copy of the Court Order to the Registrar of Companies.

Scheme timetable / further information

A full anticipated timetable will be set out in the Scheme Document which will be posted to Alternative Networks Shareholders and, for information only, to participants in the Alternative Networks Share Schemes, along with the notices of the Court Meeting and the General Meeting and the Forms of Proxy, within 28 days of the date of this Announcement (unless Daisy and Alternative Networks otherwise agree, and the Takeover Panel consents, to a later date). Subject to certain restrictions relating to persons resident in Restricted Jurisdictions, the Scheme Document will also be made available on Daisy's website at https://daisygroup.com/recommendedacquisition and Alternative Networks' website at www.alternativenetworks.com/investors/.

At this stage, subject to the approval and availability of the Court (which is subject to change), Daisy and Alternative Networks expect the Scheme to become Effective by the end of 2016.

Right to switch to a Takeover Offer

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

Prior to the Scheme becoming Effective and subject to any applicable requirements of the AIM Rules, Daisy intends to procure the making of an application by Alternative Networks for cancellation of the admission to trading on AIM of the Alternative Networks Shares on the first Business Day following the Effective Date.

Share certificates in respect of the Alternative Networks Shares will cease to be valid and should be destroyed following the Effective Date. In addition, entitlements to Alternative Networks Shares held within the CREST system will be cancelled at that time.

As soon as practicable after the Effective Date and after the cancellation of the admission to trading on AIM of the Alternative Networks Shares, it is intended that Alternative Networks will be re-registered as a private limited company under the relevant provisions of the Companies Act.

16. Disclosure of interests in Alternative Networks

As at the close of business on 18 November 2016, being the last Business Day prior to the date of this Announcement, save for the irrevocable undertakings referred to in paragraph 6 (Irrevocable undertakings and letters of intent) above, none of Daisy nor any Daisy Director nor, so far as Daisy is aware, any person acting, or deemed to be acting, in concert with Daisy:

a) had an interest in, or right to subscribe for, relevant securities of Alternative Networks;

b) had any short position in (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative, any agreement to sell or any delivery obligation or right to require another person to purchase or take delivery of, relevant securities of Alternative Networks;

c) had procured an irrevocable commitment or letter of intent to accept the terms of the Acquisition in respect of relevant securities of Alternative Networks; or

d) had borrowed or lent any Alternative Networks Shares.

Furthermore, save for the irrevocable undertakings described in paragraph 6 (Irrevocable undertakings and letters of intent) above, no arrangement exists between Daisy or Alternative Networks or a person acting in concert with Daisy or Alternative Networks in relation to Alternative Networks Shares. For these purposes, an "arrangement" includes any indemnity or option arrangement, any agreement or any understanding, formal or informal, of whatever nature, relating to Alternative Networks Shares which may be an inducement to deal or refrain from dealing in such securities.

17. General

The Acquisition will be subject to the Conditions and other terms set out in this Announcement and to the full terms and conditions which will be set out in the Scheme Document. Appendix I to this Announcement contains a summary of the principal terms and conditions. It is expected that the Scheme Document will be posted to Alternative Networks Shareholders, and, for information only, to participants in the Alternative Networks Share Schemes, along with the notices of the Court Meeting and the General Meeting and the Forms of Proxy, within 28 days of the date of this Announcement, unless Daisy and Alternative Networks otherwise agree, and the Takeover Panel consents, to a later date.

In deciding whether or not to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting, Alternative Networks Shareholders should rely on the information contained, and follow the procedures described, in the Scheme Document.

Oakley, Investec, Rothschild and finnCap have each given and not withdrawn their consent to the publication of this Announcement with the inclusion herein of the references to their names in the form and context in which they appear.

Appendix II contains details of sources of information and bases of calculation contained in this Announcement. Appendix III contains certain details relating to the irrevocable undertakings referred to in this Announcement. Appendix IV contains definitions of certain terms used in this Announcement.

18. Documents on display

Copies of this Announcement and the following documents will, by no later than 12 noon on the Business Day following the date of this Announcement, be made available on Daisy's website at https://daisygroup.com/recommendedacquisition and Alternative Networks' website at www.alternativenetworks.com/investors/ until the end of the Offer Period:

· the Confidentiality Agreement;

· the written consents provided by each of Oakley, Investec, Rothschild and finnCap;

· documents relating to the financing of the Acquisition referred to in paragraph 10 (Financing) above; and

· the irrevocable undertakings and the letters of intent referred to in paragraph 6 (Irrevocable undertakings and letters of intent) above and described in Appendix III to this Announcement.

Enquiries:

Media enquiries for Daisy

Simon Wright Tel: +44 (0) 747 122 8228

Oakley Advisory Limited (Financial adviser to Daisy)

Chris Godsmark Tel: +44 (0) 20 7766 6900Zishaan Arshad Marc Jones

Alternative Networks

Gavin Griggs Tel: +44 (0) 870 190 7444

Investec Bank plc (Rule 3 adviser, nominated adviser and joint corporate broker to Alternative Networks)

Patrick Robb Tel: +44 (0) 20 7597 5000

Andrew Pinder

Carlton Nelson

N M Rothschild & Sons Limited (Financial adviser to Alternative Networks)

Warner Mandel Tel: +44 (0) 20 7280 5000

Stephan Bocklet

finnCap Limited (Joint corporate broker to Alternative Networks)

Stuart Andrews Tel: +44 (0) 20 7220 0565

Bell Pottinger Financial & Corporate (Public relations adviser to Alternative Networks)

Elly Williamson Tel: +44 (0) 20 3772 2500

Anna Legge

Overseas shareholders

Forward-looking statements

No profit forecasts or estimates

Right to switch to a Takeover Offer

Publication on website and availability of hard copies

Information relating to Alternative Networks Shareholders

Rounding

Disclosure requirements of the Code

Rule 2.9 disclosure

APPENDIX I

CONDITIONS AND CERTAIN FURTHER TERMS OF THE ACQUISITION

Part A: Conditions to the Scheme and the Acquisition

The Acquisition is conditional upon the Scheme becoming unconditional and effective, subject to the Code, by not later than the Long Stop Date or such later date (if any) as Daisy and Alternative Networks may agree and (if required) the Court and Takeover Panel allow.

1. The Scheme shall be subject to the following conditions:

1.1 (i) its approval by a majority in number of the Alternative Networks Shareholders who are on the register of members of Alternative Networks at the Voting Record Time and who are present and vote, whether in person or by proxy, at the Court Meeting (or at any adjournment thereof) (and at any separate class meeting which may be required by the Court) and who represent 75 per cent. or more in value of the Alternative Networks Shares voted by those Alternative Networks Shareholders; and (ii) such Court Meeting (or any adjournment thereof) being held on or before the 22nd day after the expected date of the Court Meeting to be set out in the Scheme Document (or such later date, if any, as Daisy and Alternative Networks may agree and the Court may allow);

1.2 (i) the passing of the Resolutions by the requisite majority at the General Meeting (or at any adjournment thereof); and (ii) such General Meeting (or any adjournment thereof) being held on or before the 22nd day after the expected date of the General Meeting to be set out in the Scheme Document (or such later date, if any, as Daisy and Alternative Networks may agree and the Court may allow);

1.3 (i) the sanction of the Scheme by the Court (with or without modification but subject to any modification being on terms acceptable to Daisy and Alternative Networks) at the Court Hearing; and (ii) such Court Hearing being held on or before the 22nd day after the expected date of the Court Hearing to be set out in the Scheme Document (or such later date, if any, as Daisy and Alternative Networks may agree and the Court may allow); and

1.4 delivery of a copy of the Court Order to the Registrar of Companies.

2. In addition, subject as stated in Part B below and to the requirements of the Takeover Panel, the Acquisition shall be conditional upon the following Conditions and, accordingly, the Court Order shall not be delivered to the Registrar of Companies unless the Conditions referred to in this paragraph 2 (as amended, if appropriate) have been satisfied or, where relevant, waived prior to the Scheme being sanctioned by the Court in accordance with the Condition in paragraph 1.3 above:

Antitrust and regulatory

(a) no Third Party having decided, threatened or given notice of a decision to take, institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference (and, in each case, not having withdrawn the same), or having required any action to be taken or otherwise having done anything, or having enacted, made or proposed any statute, regulation, decision, order or change to published practice (and in each case, not having withdrawn the same) and there not continuing to be outstanding any statute, regulation, decision or order which would or might reasonably be expected to:

(i) require, prevent or materially delay the divestiture or materially alter the terms envisaged for such divestiture by any member of the Daisy Group or by any member of the Wider Alternative Networks Group of all or any material part of their respective businesses, assets, property or any shares or other securities (or the equivalent) in any member of the Wider Alternative Networks Group or any member of the Daisy Group or impose any material limitation on the ability of all or any of them to conduct their respective businesses (or any part thereof) or to own, control or manage any of their respective assets or properties (or any part thereof);

(ii) except pursuant to Chapter 3 of Part 28 of the Companies Act in the event that Daisy elects to implement the Acquisition by way of a Takeover Offer, require any member of the Daisy Group or the Wider Alternative Networks Group to acquire or offer to acquire any shares, other securities (or the equivalent) or interest in any member of the Wider Alternative Networks Group or any material asset owned by any Third Party (other than in connection with the implementation of the Acquisition);

(iii) impose any material limitation on, or result in a material delay in, the ability of any member of the Daisy Group, directly or indirectly, to acquire, hold or exercise effectively all or any rights of ownership in respect of shares or loans or securities convertible into shares or other securities (or the equivalent) in Alternative Networks or on the ability of any member of the Wider Alternative Networks Group or any member of the Daisy Group, directly or indirectly, to hold or exercise effectively all or any rights of ownership in respect of shares or loans or any other securities (or the equivalent) in, or to exercise voting or management control over, any other member of the Wider Alternative Networks Group;

(iv) make the Acquisition, its implementation or the acquisition or proposed acquisition of any shares or other securities in, or control or management of, Alternative Networks by any member of the Daisy Group void, unenforceable and/or illegal under the laws of any relevant jurisdiction, or otherwise, directly or indirectly, prevent or prohibit, restrict, restrain or delay or otherwise interfere with the implementation of, or impose additional conditions or obligations with respect to, or otherwise challenge, impede, interfere or require material amendment to the terms of the Acquisition or the acquisition or proposed acquisition of any shares or other securities in, or control or management of, Alternative Networks by any member of the Daisy Group;

(v) impose any material limitation on, or result in material delay in, the ability of any member of the Daisy Group or any member of the Wider Alternative Networks Group to conduct, integrate or co-ordinate all or any part of its business with all or any part of the business of any other member of the Daisy Group and/or the Wider Alternative Networks Group;

(vi) result in any member of the Wider Alternative Networks Group or any member of the Daisy Group ceasing to be able to carry on business under any name under which it currently does so in any jurisdiction (the consequences of which are material in the context of either the Daisy Group or the Wider Alternative Networks Group, taken as a whole); or

(vii) otherwise materially adversely affect all or any of the business, assets, liabilities or profits, of any member of the Wider Alternative Networks Group or any member of the Daisy Group,

and all applicable waiting and other time periods (including any extensions thereof) during which any such Third Party could decide to take, institute, implement or threaten any such action, proceeding, suit, investigation, enquiry or reference or take any other step under the laws of any relevant jurisdiction in respect of the Acquisition or the acquisition or proposed acquisition of any Alternative Networks Shares or other securities in, or control or management of, Alternative Networks or otherwise intervene having expired, lapsed or been terminated;

Other regulatory approvals

(b) each Governmental Entity, which regulates or licenses any member of the Alternative Networks Group or any other body corporate in which any member of the Alternative Networks Group has an interest in shares, and whose prior approval, consent or non-objection to any change in control, or acquisition of (or increase in) control in respect of that or any other member of the Alternative Networks Group is required, or any Governmental Entity, whose prior approval, consent or non-objection of the Acquisition is otherwise required, or from whom one or more material licences or permissions are required in order to complete the Acquisition, having given its approval, non-objection or legitimate deemed consent or consent in writing thereto and, as the case may be, having granted such licences and permissions (in each case where required and on terms reasonably satisfactory to Daisy);

Notifications, waiting periods and authorisations

(c) all notifications, filings or applications which are necessary or considered appropriate by Daisy (acting reasonably) having been made in connection with the Acquisition and all necessary waiting and other time periods (including any extensions thereof) under any applicable legislation or regulation of any jurisdiction having expired, lapsed or been terminated or waived (as appropriate) and all statutory and regulatory obligations in any jurisdiction having been complied with, in each case, in respect of the Scheme and the Acquisition and all Authorisations required by applicable law or deemed reasonably necessary or appropriate by Daisy (acting reasonably) in any jurisdiction for, or in respect of, the Acquisition and, except pursuant to Chapter 3 of Part 29 of the Companies Act, the acquisition or the proposed acquisition of any shares or other securities in, or control or management of, Alternative Networks or any other member of the Wider Alternative Networks Group by any member of the Daisy Group having been obtained in terms and in a form reasonably satisfactory to Daisy from all appropriate Third Parties or (without prejudice to the generality of the foregoing) from any person or bodies with whom any member of the Wider Alternative Networks Group or the Daisy Group has entered into material contractual arrangements and all such Authorisations required by applicable law to carry on the business of any member of the Wider Alternative Networks Group in any jurisdiction having been obtained and all such Authorisations remaining in full force and effect at the time at which the Acquisition becomes otherwise wholly unconditional and there being no notice or intimation of an intention to revoke, suspend, restrict, modify or not to renew such Authorisations;

Alternative Networks Shareholder resolution

(d) no resolution of Alternative Networks Shareholders in relation to any acquisition or disposal of assets or shares (or the equivalent thereof) in any undertaking or undertakings (or in relation to any merger, demerger, consolidation, reconstruction, amalgamation or scheme) being passed at a meeting of Alternative Networks Shareholders other than in relation to the Acquisition or the Scheme and, other than with the consent or the agreement of Daisy, no member of the Wider Alternative Networks Group having taken (or agreed or proposed to take) any action that requires, or would require, the consent of the Takeover Panel or the approval of Alternative Networks Shareholders in accordance with, or as contemplated by, Rule 21.1 of the Code;

Certain matters arising as a result of any arrangement, agreement, etc.

(e) except as Disclosed, there being no provision of any arrangement, agreement, lease, licence, franchise, permit or other instrument to which any member of the Wider Alternative Networks Group is a party or by or to which any such member or any of its assets is or may be bound, entitled or subject, which, as a consequence of the Acquisition or the acquisition or the proposed acquisition by any member of the Daisy Group of any shares or other securities (or the equivalent) in Alternative Networks or because of a change in the control or management of any member of the Wider Alternative Networks Group or otherwise, would or might reasonably be expected to result in (in each case to an extent or in a manner which is material in the context of the Wider Alternative Networks 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 such member being or becoming repayable, or capable of being declared repayable, immediately or prior to its or their stated maturity date or repayment date, or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or inhibited or being capable of becoming or being withdrawn or inhibited;

(ii) the creation, save in the ordinary and usual course of business, or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of such member or any such mortgage, charge or other security interest (whenever created, arising or having arisen) becoming enforceable;

(iii) any such arrangement, agreement, lease, licence, franchise, permit or other instrument or the rights, liabilities, obligations or interests of any such member in or with any other person (or any arrangement or arrangements relating to any such interests or business) being adversely modified or adversely affected or any obligation or liability arising or any adverse action being, or becoming capable of being terminated taken or arising thereunder;

(iv) any liability of any such member to make any severance, termination, bonus or other payment to any of its directors or other officers;

(v) the rights, liabilities, obligations, interests or business of any such member or any member of the Wider Alternative Networks Group under any such arrangement, agreement, licence, permit, lease or instrument or the interests or business of any such member or any member of the Wider Alternative Networks Group in or with any other person or body or firm or company (or any arrangement relating to any such interests or business) being or becoming capable of being terminated, or adversely modified or affected or any onerous obligation or liability arising or any adverse action being taken thereunder;

(vi) any such member ceasing to be able to carry on business under any name under which it presently carries on business;

(vii) the value of, or the financial or trading position or prospects of, any such member being prejudiced or adversely affected; or

(viii) the creation or acceleration of any liability (actual or contingent) by any such member other than trade creditors or other liabilities incurred in the ordinary course of business,

and no event having occurred which, under any provision of any arrangement, agreement, licence, permit, franchise, lease or other instrument to which any member of the Wider Alternative Networks Group is a party or by or to which any such member or any of its assets are bound, entitled or subject, would or might result in any of the events or circumstances as are referred to in Conditions ‎(e)‎(i) to ‎(viii) above (in each case, to an extent or in a manner which is material in the context of the Wider Alternative Networks Group, taken as a whole);

Certain events occurring since 30 September 2015

(f) except as Disclosed, no member of the Wider Alternative Networks Group having since 30 September 2015:

(i) issued or agreed to issue or authorised or proposed or announced its intention to authorise or propose the issue of additional shares of any class, or securities or securities convertible into, or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares, securities or convertible securities or transferred or sold or agreed to transfer or sell or authorised or proposed the transfer or sale of Alternative Networks Shares out of treasury (except, where relevant, as between Alternative Networks and wholly-owned subsidiaries of Alternative Networks or between the wholly-owned subsidiaries of Alternative Networks and except for the issue of Alternative Networks Shares pursuant to or in connection with the exercise or vesting of options or awards granted under, or the grant of options or awards under the Alternative Networks Share Schemes);

(ii) recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution (whether payable in cash or otherwise) other than dividends (or other distributions whether payable in cash or otherwise) lawfully paid or made by any wholly-owned subsidiary of Alternative Networks to Alternative Networks or any of its wholly-owned subsidiaries;

(iii) other than pursuant to the Acquisition (and except for transactions between Alternative Networks and its wholly-owned subsidiaries or between the wholly-owned subsidiaries of Alternative Networks and transactions in the ordinary course of business) implemented, effected, authorised or proposed or announced its intention to implement, effect, authorise or propose any merger, demerger, reconstruction, amalgamation, scheme, commitment or acquisition or disposal of assets or shares or loan capital (or the equivalent thereof) in any undertaking or undertakings in any such case to an extent which is material in the context of the Wider Alternative Networks Group, taken as a whole;

(iv) except for transactions between Alternative Networks and its wholly-owned subsidiaries or between the wholly-owned subsidiaries of Alternative Networks and transactions in the ordinary course of business, disposed of, or transferred, mortgaged or created any security interest over any material asset or any right, title or interest in any material asset or authorised, proposed or announced any intention to do so;

(v) except for transactions between Alternative Networks and its wholly-owned subsidiaries or between the wholly-owned subsidiaries of Alternative Networks, issued, authorised or proposed or announced an intention to authorise or propose the issue of or made any change in or to the terms of any debentures or become subject to any contingent liability or incurred or increased any indebtedness which, in any such case, is material in the context of the Wider Alternative Networks Group, taken as a whole;

(vi) entered into or varied or authorised, proposed or announced its intention to enter into or vary any contract, arrangement, agreement, transaction or commitment (whether in respect of capital expenditure or otherwise) except in the ordinary course of business which is of a long term, unusual or onerous nature or magnitude or which involves or could involve an obligation of a material nature or magnitude which is reasonably likely to be restrictive on the business of any member of the Wider Alternative Networks Group and which, taken together with any other such contract, arrangement, agreement, transaction or commitment is material in the context of the Wider Alternative Networks Group, taken as a whole;

(vii) entered into or varied the terms of, or made any offer (which remains open for acceptance) to enter into or vary to a material extent the terms of any contract, service agreement, commitment or arrangement with any director or senior executive of any member of the Wider Alternative Networks Group;

(viii) 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 employee of the Wider Alternative Networks Group, otherwise than in the ordinary course of business;

(ix) purchased, redeemed or repaid or announced any proposal to purchase, redeem or repay any of its own shares or other securities or reduced or made any other change to any part of its share capital;

(x) waived, compromised or settled any claim where such waiver, settlement or compromise would have a material adverse effect on the financial position of the Wider Alternative Networks Group, taken as a whole;

(xi) terminated or varied the terms of any agreement or arrangement between any member of the Wider Alternative Networks Group and any other person in a manner which would or might have a material adverse effect on the financial position of the Wider Alternative Networks Group, taken as a whole;

(xii) made any alteration to its memorandum, articles of association or other incorporation documents or any alteration to the memorandum, articles of association or other incorporation documents of any other member of the Wider Alternative Networks Group;

(xiii) made or agreed or consented to any significant change to:

(A) the terms of the trust deeds and rules constituting the pension scheme(s) established by any member of the Wider Alternative Networks Group for its directors, employees or their dependants;

(B) the contributions payable to any such scheme(s) or to the benefits which accrue, or to the pensions which are payable, thereunder;

(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, valued, made, agreed or consented to,

to an extent which is in any such case material in the context of the Wider Alternative Networks Group, taken as a whole;

(xiv) been unable, or admitted in writing that it is unable, to pay its debts or commenced negotiations with one or more of its creditors with a view to rescheduling or restructuring any of its indebtedness, or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business which is material in the context of the Wider Alternative Networks Group, taken as a whole;

(xv) (other than in respect of a member of the Wider Alternative Networks Group which is dormant and was solvent at the relevant time) taken or proposed any steps, corporate action or had any legal proceedings instituted or threatened against it in relation to the suspension of payments, a moratorium of any indebtedness, its winding-up (voluntary or otherwise), dissolution, reorganisation or for the appointment of a receiver, administrator, manager, administrative receiver, trustee or similar officer of all or any material part of its assets or revenues or any analogous or equivalent steps or proceedings in any jurisdiction or appointed any analogous person in any jurisdiction or had any such person appointed;

(xvi) (except for transactions between Alternative Networks and its wholly-owned subsidiaries or between the wholly-owned subsidiaries) made, authorised, proposed or announced an intention to propose any change in its loan capital;

(xvii) entered into, implemented or authorised the entry into, any joint venture, asset or profit sharing arrangement, partnership or merger of business or corporate entities, which, in any such case, is material in the context of the Wider Alternative Networks Group, taken as a whole; or

(xviii) entered into any agreement, arrangement, commitment or contract or passed any resolution or made any offer (which remains open for acceptance) with respect to, or announced an intention to, or to propose to, effect any of the transactions, matters or events referred to in this Condition ‎(f);

No adverse change, litigation, regulatory enquiry or similar

(g) except as Disclosed, since 30 September 2015 there having been:

(i) no adverse change and no circumstance having arisen which would or might reasonably be expected to result in any adverse change in, the business, assets, liabilities, shareholders' equity, financial or trading position or profits, operational performance or prospects of any member of the Wider Alternative Networks Group which is material in the context of the Wider Alternative Networks Group, taken as a whole;

(ii) no litigation, arbitration proceedings, prosecution or other legal proceedings (including, without limitation, with respect to intellectual property rights owned or used by the Alternative Networks Group) to which any member of the Wider Alternative Networks Group is or may become a party (whether as a claimant, defendant or otherwise) having been threatened, announced, implemented or instituted by or against or remaining outstanding against or in respect of, any member of the Wider Alternative Networks Group, in each case which would or might reasonably be expected to have a material adverse effect on the Wider Alternative Networks Group, taken as a whole;

(iii) no enquiry, review or investigation by, or complaint or reference to, any Third Party against or in respect of any member of the Wider Alternative Networks Group (or any person in respect of which any such member has or may have responsibility or liability) having been threatened, announced, implemented or instituted or remaining outstanding by, against or in respect of any member of the Wider Alternative Networks Group, in each case, which would or might reasonably be expected to have a material adverse effect on the Wider Alternative Networks Group, taken as a whole;

(iv) no contingent or other liability having arisen or become apparent to Daisy or increased other than in the ordinary course of business which would or might reasonably be expected to affect adversely the business, assets, financial or trading position or profits or prospects of any member of the Wider Alternative Networks Group to an extent which is material in the context of the Wider Alternative Networks Group, taken as a whole; and

(v) no steps having been taken and no omissions having been made which are likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the Wider Alternative Networks Group which is necessary for the proper carrying on of its business and the withdrawal, cancellation, termination or modification of which would or might reasonably be expected to have a material adverse effect on the Wider Alternative Networks Group, taken as a whole; or

No discovery of certain matters regarding information and liabilities, corruption and intellectual property

(h) except as Disclosed, Daisy not having discovered that:

(i) any financial, business or other information concerning the Wider Alternative Networks Group announced publicly prior to the date of this Announcement or disclosed to any member of the Daisy Group by or on behalf of any member of the Wider Alternative Networks Group prior to the date of this Announcement is misleading, contains a misrepresentation of any fact, or omits to state a fact necessary to make that information not misleading, in any such case to an extent which is material in the context of the Wider Alternative Networks Group, taken as a whole;

(ii) any member of the Wider Alternative Networks Group is subject to any liability, contingent or otherwise, and which is material in the context of the Wider Alternative Networks Group taken as a whole;

(iii) any past or present member of the Wider Alternative Networks Group has not complied in any material respect with all applicable legislation, regulations of any jurisdiction or any Authorisations relating to the use, treatment, storage, carriage, disposal, discharge, spillage, release, leak or emission of any waste or hazardous substance or any substance likely to impair the environment (including any property) or harm human or animal health or otherwise relating to environmental matters or the health and safety of humans, which non-compliance would be likely to give rise to any material liability including any penalty for non-compliance (whether actual or contingent) on the part of any member of the Wider Alternative Networks Group which, in any case, is material in the context of the Wider Alternative Networks Group, taken as a whole;

(iv) there has been a material disposal, discharge, spillage, accumulation, release, leak, emission or the migration, production, supply, treatment, storage, transport or use of any waste or hazardous substance or any substance likely to impair the environment (including any property) or harm human or animal health which (whether or not giving rise to non-compliance with any law or regulation), would be likely to give rise to any material liability (whether actual or contingent) on the part of any member of the Wider Alternative Networks Group which, in any case, is material in the context of the Wider Alternative Networks Group, taken as a whole;

(v) there is, or is reasonably likely to be, any material obligation or liability (whether actual or contingent) or requirement to make good, remediate, repair, reinstate or clean up any property or asset currently or previously owned, occupied, operated or made use of or controlled by any past or present member of the Wider Alternative Networks Group (or on its behalf), or in which any such member may have, or previously have had or be deemed to have had, an interest, under any environmental legislation, common law, regulation, notice, circular, Authorisation or order of any Third Party in any jurisdiction or to contribute to the cost thereof or associated therewith or indemnify any person in relation thereto, which, in any case, is material in the context of the Wider Alternative Networks Group, taken as a whole;

(vi) circumstances exist (whether as a result of the making of the Acquisition or otherwise) which would be reasonably likely to lead to any Third Party instituting (or whereby any member of the Wider Alternative Networks Group would be likely to be required to institute) an environmental, audit or take any steps which would, in any such case, be reasonably likely to result in any actual or contingent liability to improve or install new plant or equipment or to make good, repair, reinstate or clean up any property of any description or any asset now or previously owned, occupied or made use of by any past or present member of the Wider Alternative Networks Group (or on its behalf) or by any person for which a member of the Wider Alternative Networks Group is or has been responsible, or in which any such member may have, or previously have had or be deemed to have had, an interest, which, in any case, is material in the context of the Wider Alternative Networks Group, taken as a whole;

(vii) any member of the Wider Alternative Networks Group is subject to any liability, actual or contingent and which has arisen otherwise than in the ordinary course of business, which is not disclosed in the annual report and accounts of Alternative Networks for the period ended 30 September 2015 and which is material in the context of the Wider Alternative Networks Group, taken as a whole;

(viii) circumstances exist whereby a person has, or class of persons have, or is reasonably likely to have, any legitimate claim or claims against any member of the Wider Alternative Networks Group in respect of any product or process, or materials used therein, now or previously manufactured, sold, supplied or carried out by any past or present member of the Wider Alternative Networks Group, which, in each case, is material in the context of the Wider Alternative Networks Group, taken as a whole;

(ix) any member of the Wider Alternative Networks Group or any person that performs or has performed services for or on behalf of any such member is or has engaged in any activity, practice or conduct which would constitute an offence under the Bribery Act 2010 or any other applicable anti-corruption legislation;

(x) any past or present member of the Wider Alternative Networks Group has engaged in any activity or business with, or made any investments in, or made any payments to any government, entity or individual covered by any of the economic sanctions administered by the United Nations or the European Union (or any of their respective member states) or the United States Office of Foreign Assets Control or any other governments or supranational body or authority in any jurisdiction;

(xi) any asset of any member of the Wider Alternative Networks Group constitutes criminal property as defined by section 340(3) of the Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that definition);

(xii) no circumstance having arisen or event having occurred in relation to any intellectual property owned or used by any member of the Wider Alternative Networks Group, which would have a material adverse effect on the Wider Alternative Networks Group, taken as a whole, including:

(A) any member of the Wider Alternative Networks Group losing its title to any of its intellectual property, or any intellectual property owned by the Wider Alternative Networks Group being revoked, cancelled or declared invalid;

(B) any claim being asserted or threatened by any person challenging the ownership of any member of the Wider Alternative Networks Group to, or the validity or effectiveness of, any of its intellectual property; or

(C) any agreement regarding the use of any intellectual property licensed to or by any member of the Wider Alternative Networks Group being terminated or varied.

Part B: Certain further terms of the Acquisition

1. Subject to the requirements of the Takeover Panel, Daisy reserves the right in its sole discretion to waive (if capable of waiver), in whole or part:

(i) any of the Conditions set out in the above Condition ‎1 of Part A relating to the timing of the Court Meeting, the General Meeting and the sanctioning of the Scheme. If any of the deadlines for those events are not met, Daisy shall make an announcement by 8.00 a.m. on the Business Day following such deadline confirming whether it has invoked or waived the relevant Condition or agreed with Alternative Networks to extend the deadline in relation to the relevant Condition; and

(ii) in whole or in part, all or any of the above Conditions 2(a) (Antitrust and regulatory) to (h) (No discovery of certain matters regarding information and liabilities, corruption and intellectual property) of Part A (inclusive).

2. Conditions 2(a) (Antitrust and regulatory) to (h) (No discovery of certain matters regarding information and liabilities, corruption and intellectual property) of Part A (inclusive) must be fulfilled or waived by no later than 11:59 p.m. on the date immediately preceding the date of the Court Hearing, failing which the Scheme will lapse or, if the Acquisition is implemented by way of a Takeover Offer, no later than as permitted by the Takeover Panel. Daisy shall be under no obligation to waive or treat as satisfied any of the Conditions by a date earlier than the latest date specified above for the fulfilment or waiver thereof, notwithstanding that any such Condition or the other Conditions of the Scheme and the Acquisition may at such earlier date have been waived or fulfilled and that there are at such earlier date no circumstances indicating that any of such Conditions may not be capable of fulfilment.

3. Under Rule 13.5 of the Code, Daisy may not invoke a Condition so as to cause the Scheme not to proceed, or to lapse, or so as to cause any Takeover Offer to lapse or be withdrawn, unless the circumstances which give rise to the right to invoke the Condition are of material significance to Daisy in the context of the Acquisition. Condition ‎1 of Part A (and, if applicable, any acceptance condition adopted on the basis specified in paragraph 5 below in relation to any Takeover Offer) and paragraph 6 below are not subject to this provision of the Code.

4. If Daisy is required by the Takeover Panel to make an offer for Alternative Networks Shares under the provisions of Rule 9 of the Code, Daisy may make such alterations to the Conditions and further terms of the Acquisition as are necessary to comply with the provisions of that Rule.

5. Daisy reserves the right to elect (with the consent of the Takeover Panel) to implement the Acquisition by making, directly or indirectly through a subsidiary or nominee of Daisy, a Takeover Offer as an alternative to the Scheme. In such event, the Takeover Offer will be implemented on the same terms or, if Daisy so decides (with the consent of the Takeover Panel), on such other terms being no less favourable, subject to appropriate amendments, as far as applicable, as those which would apply to the Scheme. The acceptance condition would be set at 90 per cent. of the shares to which such Takeover Offer relates (or such lesser percentage, being more than 50 per cent., as Daisy may decide with the consent of the Takeover Panel). Further, if sufficient acceptances of the Takeover Offer are received and/or sufficient Alternative Networks Shares are otherwise acquired, it is the intention of Daisy to apply the provisions of the Companies Act to compulsorily acquire any outstanding Alternative Networks Shares to which such Takeover Offer relates.

6. The Acquisition will lapse (unless otherwise agreed with the Takeover Panel) if:

(i) in so far as the Acquisition or any matter arising from or relating to the Scheme or Acquisition constitutes a concentration with a Community dimension within the scope of the Regulation, the European Commission either initiates proceedings under Article 6(1)(c) of the Regulation or makes a referral to a competent authority of the United Kingdom under Article 9(1) of the Regulation and there is then a CMA Phase 2 Reference; or

(ii) in so far as the Acquisition or any matter arising from the Scheme or Acquisition does not constitute a concentration with a Community dimension within the scope of the Regulation, the Scheme or Acquisition or any matter arising from or relating to the Acquisition becomes subject to a CMA Phase 2 Reference,

in each case, before the date of the Court Meeting.

7. Daisy reserves the right, with the prior consent of the Takeover Panel, for any other member of the Daisy Group from time to time to implement the Acquisition.

8. The Alternative Networks Shares shall be acquired by Daisy with full title guarantee, fully paid and free from all liens, equitable interests, charges, encumbrances, rights of pre-emption and any other third party rights and interests whatsoever and together with all rights existing at the date of this Announcement or thereafter attaching thereto, including (without limitation) the right to receive and retain, in full, all dividends and other distributions (if any) declared, made or paid or any other return of capital (whether by way of reduction of share capital or share premium account or otherwise) made on or after the date of this Announcement in respect of the Alternative Networks Shares.

9. If after the date of this Announcement but prior to the Effective Date any dividend or other distribution is declared, paid or made or becomes payable by Alternative Networks, Daisy reserves the right (without prejudice to any right of Daisy, with the consent of the Takeover Panel, to invoke Condition 2(f)(ii) above) to reduce the consideration payable under the terms of the Acquisition by the aggregate amount of such dividend or distribution and, accordingly, to reduce the Acquisition Price although, in such circumstances, Alternative Networks Shareholders would be entitled to retain any such dividend or distribution declared, made or paid. Furthermore, Daisy reserves the right to reduce the consideration payable under the Acquisition in respect of an Alternative Networks Share in such circumstances as are, and by such amount as is, permitted by the Takeover Panel.

If any such dividend or distribution occurs, any reference in this Announcement to the consideration payable or the Acquisition Price shall be deemed to be a reference to the consideration or Acquisition Price as so reduced. If such reduction occurs, notwithstanding the terms on which the Alternative Networks Shares are expressed to be acquired by Daisy pursuant to the Acquisition in Appendix I, the Alternative Networks Shares shall be acquired by or on behalf of Daisy pursuant to the acquisition together with all rights now and hereafter attaching to such Alternative Networks Shares including, without limitation, voting rights and the right to receive and retain, in full, all dividends and other distributions (if any) declared, made or paid or any other return of capital (whether by way of reduction of share capital or share premium account or otherwise) made on or after the date of this Announcement.

To the extent that such a dividend or distribution has been declared, paid, made or is payable and it is: (i) transferred pursuant to the Acquisition on a basis which entitles Daisy to receive the dividend or distribution and to retain it; or (ii) cancelled, the Acquisition Price will not be subject to change in accordance with this paragraph.

Any exercise by Daisy of its rights referred to in this paragraph shall be the subject of an announcement and, for the avoidance of doubt, shall not be regarded as constituting any revision or variation of the terms of the Acquisition or the Scheme.

10. The availability of the Acquisition to persons not resident in the United Kingdom may be affected by the laws of relevant jurisdictions. Therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom and any Alternative Networks Shareholders who are not resident in the United Kingdom will need to inform themselves about and observe any applicable requirements.

11. Unless otherwise determined by Daisy or required by the Code and permitted by applicable law and regulations, the Acquisition is not being, and will not be, made, directly or indirectly, in, into or by the use of the mails of, or by any other means or instrumentality (including, but not limited to, facsimile, email or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of, any Restricted Jurisdiction and no person may vote in favour of the Acquisition by any such use, means, instrumentality or facility or from within a Restricted Jurisdiction.

12. Each of the Conditions shall be regarded as a separate Condition and shall not be limited by reference to any other Condition.

13. This Announcement and any rights or liabilities arising hereunder, the Acquisition, the Scheme and the Forms of Proxy will be governed by English law and will be subject to the jurisdiction of the English courts. The Acquisition shall be subject to the applicable requirements of the Code, the Takeover Panel, the London Stock Exchange, the FCA and the AIM Rules.

APPENDIX II

SOURCES OF INFORMATION AND BASES OF CALCULATION

In this Announcement:

(i) Unless otherwise stated, financial information relating to Alternative Networks has been extracted or derived (without material adjustment) from the audited consolidated financial statements of Alternative Networks for the financial year ended 30 September 2015 or Alternative Networks' half-year report for the six months ended 31 March 2016.

(ii) References to the existing issued share capital of Alternative Networks are to the number of Alternative Networks Shares in issue as at 18 November 2016, being the last Business Day prior to the date of this Announcement, which was 49,759,741 Alternative Networks Shares. No Alternative Networks Shares are held in treasury. The international securities identification number for the Alternative Networks Shares is GB00B05KXX82.

(iii) References to the fully diluted share capital of Alternative Networks are to 49,339,491 Alternative Networks Shares based on:

· the number of existing Alternative Networks Shares set out in paragraph (ii) of this Appendix II above; plus

· a further 10,859 Alternative Networks Shares which are expected to be issued under the terms of the Alternative Networks Share Schemes; less

· 431,109 Alternative Networks Shares which are held by the trustee of the EBT and which will be Excluded Shares for the purposes of the Scheme.

(iv) Unless otherwise stated, all prices for Alternative Networks Shares are the Closing Price for the relevant date.

(v) The Closing Prices of Alternative Networks Shares are taken from the AIM Appendix to the London Stock Exchange Daily Official List.

APPENDIX III

DETAILS OF IRREVOCABLE UNDERTAKINGS AND LETTERS OF INTENT

Daisy has received irrevocable undertakings and letters of intent from the following holders or controllers of Alternative Networks Shares to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) in respect of 28,417,928 Alternative Networks Shares, in aggregate, representing approximately 57.1 per cent. of the existing issued share capital of Alternative Networks, comprised as follows:

Irrevocable undertakings

Alternative Networks Directors (and certain of their immediate family members)

Name	Number of Alternative Networks Shares	Percentage ofAlternative Networks Shares in issue
James Murray	14,344,488	28.8%
Mark Quartermaine	3,404	0.0%
Gavin Griggs	4,432	0.0%
Bernard Cragg	35,000	0.1%
Total	14,387,324	28.9%

Each of the Alternative Networks Directors listed above has irrevocably undertaken to Daisy that he will exercise or, where applicable, procure the exercise of, all votes (whether on a show of hands or a poll and whether in person or by proxy) in relation to the Alternative Networks Shares held by him or members of his immediate family, related trusts or nominee(s) (together with any Alternative Networks Shares issued after the date of the undertaking and attributable to, or derived from, such shares) at the Court Meeting and the General Meeting (in each case, including any adjournment thereof) in favour of the Scheme and the Resolutions, respectively (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer in respect of all the Alternative Networks Shares held by him or members of his immediate family, related trusts or nominee(s)).

These irrevocable commitments extend to any Alternative Networks Shares arising from the exercise of options and/or awards held under the Alternative Networks Share Schemes (not including the Alternative Networks plc Company Share Option Plan) prior to the date of the Court Meeting and the General Meeting.

The irrevocable undertakings from the Alternative Networks Directors will only lapse and cease to be binding if:

· the Scheme Document is not published within 28 days (or such longer period as Daisy and Alternative Networks may agree with the consent of the Takeover Panel) after the date of this Announcement;

· the Scheme has not become effective by the Long Stop Date; or

· the Scheme lapses or is withdrawn in accordance with its terms (for the avoidance of doubt, this shall not apply where the Scheme lapses or is withdrawn solely as a result of Daisy exercising its right to implement the Acquisition by way of Takeover Offer rather than a Scheme) and no new, revised or replacement Scheme or Takeover Offer has been announced by Daisy or its affiliates in accordance with Rule 2.7 of the Code at the same time.

Alternative Networks Former Directors and Founders

Name	Number of Alternative Networks Shares	Percentage ofAlternative Networks Shares in issue
Ed and Lucinda Spurrier	1,985,619	4.0%
Jim Sewell	1,865,899	3.7%
Chris Wilson	4,159,699	8.4%
Total	8,011,217	16.1%

Each of the Alternative Networks Former Directors and Founders listed above (save for Ed and Lucinda Spurrier) has irrevocably undertaken to Daisy that he will exercise or, where applicable, procure the exercise of, all votes (whether on a show of hands or a poll and whether in person or by proxy) in relation to the Alternative Networks Shares held by him or members of his immediate family, related trusts or nominee(s) (together with any Alternative Networks Shares issued after the date of the undertaking and attributable to, or derived from, such shares) at the Court Meeting and the General Meeting (in each case, including any adjournment thereof) in favour of the Scheme and the Resolutions, respectively (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer in respect of all the Alternative Networks Shares held by him or members of his immediate family, related trusts or nominee(s)).

Ed and Lucinda Spurrier have irrevocably undertaken to Daisy that they will exercise or, where applicable, procure the exercise of, all votes (whether on a show of hands or a poll and whether in person or by proxy) in respect of 766,311 Alternative Networks Shares held by them in their personal capacity and 1,219,308 Alternative Networks Shares held by 7 SFI Limited, an investment company which they own and control (such shares representing 50 per cent. of the Alternative Networks Shares held by 7 SFI Limited as at the date of this Announcement) (together with any Alternative Networks Shares issued after the date of the undertaking and attributable to, or derived from, such shares) at the Court Meeting and the General Meeting (in each case, including any adjournment thereof) in favour of the Scheme and the Resolutions, respectively (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer in respect of 766,311 Alternative Networks Shares held by them in their personal capacity and 1,219,308 Alternative Networks Shares held by 7 SFI Limited).

The irrevocable undertakings from the Alternative Networks Former Directors and Founders will only lapse and cease to be binding if:

· the Scheme Document is not published within 28 days (or such longer period as Daisy and Alternative Networks may agree with the consent of the Takeover Panel) after the date of this Announcement;

· the Scheme has not become effective by the Long Stop Date; or

Letters of intent

Name	Number of Alternative Networks Shares	Percentage ofAlternative Networks Shares in issue
Herald Investment Management Limited	2,031,520	4.1%
Octopus Investments Limited	3,987,867	8.0%
Total	6,019,387	12.1%

Daisy has received non-binding letters of intent to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer) from each of Herald Investment Management Limited and Octopus Investments Limited in respect of 6,019,387 Alternative Networks Shares, in aggregate, representing approximately 12.1 per cent. of the Alternative Networks Shares in issue on 18 November 2016 (being the last Business Day prior to the date of this Announcement).

The letters of intent are non-binding. In addition, the letter of intent provided by Herald Investment Management Limited specifically states that if, not later than 12 noon on the 14th day following the posting of the Scheme Document (or offer document, as the case may be), a third party announces a firm intention to make an offer for the entire issued and to be issued share capital of Alternative Networks at a value which (in Daisy's reasonable opinion on the advice of its financial adviser) is not less than 10 per cent. greater than the value per Alternative Networks Share offered pursuant to the Acquisition, then Herald Investment Management Limited will withdraw its intention to vote, or procure votes, in favour of the Scheme at the Court Meeting and the Resolutions to be proposed at the General Meeting (or, if (with the consent of the Takeover Panel) Daisy exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure acceptances of, such Takeover Offer).

APPENDIX IV

DEFINITIONS

In this Announcement, the following words and expressions have the following meanings, unless the context requires otherwise:

Acquisition	the recommended cash acquisition of the entire issued and to be issued ordinary share capital of Alternative Networks (other than those Alternative Networks Shares held by the EBT at the Scheme Record Time) to be made by Daisy to be effected by means of the Scheme (or, if Daisy so elects and subject to the Takeover Panel's consent, a Takeover Offer) on the terms and subject to the conditions set out in this Announcement and to be set out in the Scheme Document;
Acquisition Price	335 pence per Alternative Networks Share;
AIM	AIM, a market operated by the London Stock Exchange;
AIM Rules	the AIM Rules for Companies, as published by the London Stock Exchange (as amended from time to time);
Alternative Networks	Alternative Networks plc, a public limited company incorporated in England and Wales with registered number 2888250 and having its registered office at 5th Floor, 240 Blackfriars Road, London SE1 8NW;
Alternative Networks Articles	Alternative Networks' articles of association currently adopted and filed with the Registrar of Companies;
Alternative Networks Directors	the directors of Alternative Networks from time to time;
Alternative Networks Former Directors and Founders	has the meaning given to the expression in paragraph 3 (Recommendation) of this Announcement;
Alternative Networks Group	Alternative Networks and its subsidiaries and subsidiary undertakings;
Alternative Networks Share Schemes	the Alternative Networks plc 2006 Employees' Share Option Scheme, the Alternative Networks plc Long-Term Incentive Plan, the Alternative Networks plc Company Share Option Plan, the Alternative Networks plc 2014 Share Incentive Plan and the Alternative Networks plc Long Term Reward Plan, pursuant to which Alternative Networks may grant options/awards from time to time;
Alternative Networks Shareholders	the holders of Alternative Networks Shares;
Alternative Networks Shares	ordinary shares of 0.125 pence each in the capital of Alternative Networks;
Announcement	this Announcement of the Acquisition made in accordance with Rule 2.7 of the Code;
Authorisations	authorisations, orders, recognitions, grants, consents, clearances, confirmations, certificates, licences, permissions, determinations, exemptions or approvals;
Business Day	a day, other than a Saturday, Sunday, public holiday or bank holiday, on which banks are generally open for normal business in the City of London;
Closing Price	in respect of an Alternative Networks Share on any particular day, the price at which the last trade was made, as derived from the AIM appendix to the Daily Official List on that day;
CMA	the Competition and Markets Authority, being the independent body which conducts inquiries into mergers, markets and the regulation of the major regulated industries in the United Kingdom (or any successor body or bodies carrying out the same functions in the United Kingdom from time to time);
CMA Phase 2 Reference	a reference pursuant to sections 22 or 33, 45 or 62 of the Enterprise Act 2002 of the Acquisition to the chair of the CMA for the constitution of a group under Schedule 4 to the Enterprise and Regulatory Reform Act 2013;
Code	the City Code on Takeovers and Mergers;
Community	the European Community;
Companies Act	the United Kingdom Companies Act 2006, as amended;
Conditions	the conditions to the implementation of the Scheme and the Acquisition, which are set out in Appendix I to this Announcement and will be set out in the Scheme Document;
Confidentiality Agreement	the confidentiality agreement entered into by Daisy and Alternative Networks on 8 April 2016;
Court	the High Court of Justice in England and Wales;
Court Hearing	the hearing by the Court to sanction the Scheme and, if such hearing is adjourned, references to the commencement of any such hearing shall mean the commencement of the final adjournment thereof;
Court Meeting	the meeting (or any adjournment, postponement or reconvention thereof) of the holders of Scheme Shares (or the relevant class or classes thereof) to be convened by order of the Court pursuant to section 896 of the Companies Act to consider and, if thought fit, approve the Scheme (with or without modification);
Court Order	the order of the Court sanctioning the Scheme under Part 26 of the Companies Act;
CREST	the relevant system (as defined in the Regulations) in respect of which Euroclear UK & Ireland Limited is the Operator (as defined in the Regulations);
Daily Official List	the Daily Official List of the London Stock Exchange;
Daisy	Daisy Intermediate Holdings Limited, a private limited company incorporated in England and Wales with registered number 8384981 and having its registered office at Daisy House, Lindred Road Business Park, Nelson, Lancashire BB9 5SR;
Daisy Directors	the directors of Daisy from time to time;
Daisy Group	Daisy Group Holdings Limited and its subsidiary and associated undertakings;
Damovo	Daisy Corporate Services Limited (formerly Damovo UK Limited), a private limited company incorporated in England and Wales with registered number 4166889 and having its registered office at Daisy House, Lindred Road Business Park, Nelson, Lancashire BB9 5SR;
Dealing Disclosure	has the same meaning as in Rule 8 of the Code;
Disclosed	(i) matters fairly disclosed in the information made available to Daisy (or Daisy's advisers) in the data room established by Alternative Networks for the purposes of the Acquisition; (ii) information included in the annual report and accounts of the Alternative Networks Group for the financial year ended 30 September 2015; (iii) information included in Alternative Networks' half-year report for the six months ended 31 March 2016; (iv) information disclosed in a public announcement to a RIS made by Alternative Networks prior to the date of this Announcement; or (v) disclosed in this Announcement;
Disclosure Table	the disclosure table on the Takeover Panel's website at www.thetakeoverpanel.org.uk;
DSL	digital subscriber line;
Effective	in the context of the Acquisition: (a) if the Acquisition is implemented by way of a Scheme, the Scheme having become effective in accordance with its terms, upon the delivery of the Court Order to the Registrar of Companies; or (b) if the Acquisition is implemented by way of a Takeover Offer, the Takeover Offer having become, or been declared, unconditional in all respects in accordance with the requirements of the Code;
Effective Date	the date upon which: (a) the Scheme becomes Effective; or (b) if Daisy elects for, and the Takeover Panel consents to, the implementation of the Acquisition by way of a Takeover Offer, the Takeover Offer becomes Effective;
EBT	the Alternative Networks Limited Employee Benefit Trust;
Excluded Shares	(a) any Alternative Networks Shares legally or beneficially held by any member of the Daisy Group; (b) any Treasury Shares; or (c) any Alternative Networks Shares held by the trustee of the EBT at the Scheme Record Time;
FCA	the UK Financial Conduct Authority or its successor from time to time;
finnCap	finnCap Limited, joint corporate broker to Alternative Networks;
Forms of Proxy	the forms of proxy for use at the Court Meeting and the General Meeting, respectively, which will accompany the Scheme Document;
General Meeting	the general meeting (or any adjournment, postponement or reconvention thereof) of Alternative Networks Shareholders to be convened in connection with the Scheme;
Governmental Entity	any supranational, national, state, municipal, local or foreign government, any instrumentality, subdivision, court, arbitrator or arbitrator panel, regulatory or administrative agency or commission, or other authority thereof, or any regulatory or quasi-regulatory organisation or private body exercising any regulatory, taxing, importing or other governmental or quasi-governmental authority;
ICT	information and communications technology;
Investec	Investec Bank plc, independent Rule 3 adviser, nominated adviser and joint corporate broker to Alternative Networks;
IP	Internet Protocol;
ISIN	International Securities Identification Number
London Stock Exchange	London Stock Exchange Plc;
Long Stop Date	28 February 2017 or such later date (if any) as Daisy and Alternative Networks may, with the consent of the Takeover Panel, agree and (if required) the Court may allow;
Oakley	Oakley Advisory Limited, an Appointed Representative of Oakley Capital Limited, financial adviser to Daisy;
Offer Period	the period which commenced on the date of this Announcement and ending on the date on which the Acquisition becomes Effective, lapses or is withdrawn (or such other date as the Takeover Panel may decide);
Phoenix IT	Daisy IT Group Limited (formerly Phoenix IT Group plc), a private limited company incorporated in England and Wales with registered number 3476115 and having its registered office at Daisy House, Lindred Road Business Park, Nelson, Lancashire BB9 5SR;
PIK Facility	has the meaning given to the expression in paragraph 10 (Financing) of this Announcement;
Referendum	has the meaning given to the expression in paragraph 5 (Background to, and reasons for, the recommendation) of this Announcement;
Registrar of Companies	the Registrar of Companies in England and Wales;
Regulations	the Uncertificated Securities Regulations 2001 (SI 2001/3755);
Resolutions	the resolutions to be proposed by Alternative Networks at the General Meeting in connection with, amongst other things, the approval of the Scheme, the amendment of the Alternative Networks Articles and such other matters as may be necessary to implement the Scheme and the proposed cancellation of the admission to trading on AIM of the Alternative Networks Shares upon the Scheme becoming Effective;
Restricted Jurisdiction	any jurisdiction where local laws or regulations may result in a significant risk of civil, regulatory or criminal exposure if information concerning the Acquisition is sent or made available in that jurisdiction;
RIS	a service approved by the London Stock Exchange for the distribution to the public of announcements and included within the list maintained on the London Stock Exchange's website;
Rothschild	N M Rothschild & Sons Limited, financial adviser to Alternative Networks;
Scheme	the proposed scheme of arrangement under Part 26 of the Companies Act to effect the Acquisition between Alternative Networks and the Scheme Shareholders (the full terms of which will be set out in the Scheme Document), with or subject to any modification, addition or condition which Daisy and Alternative Networks may agree, and, if required, the Court may approve or impose;
Scheme Document	the document to be despatched to (among others) Alternative Networks Shareholders containing, amongst other things, the terms and conditions of the Scheme, the notices convening the Court Meeting and the General Meeting and the particulars required by section 897 of the Companies Act;
Scheme Record Time	the time and date to be specified in the Scheme Document, expected to be 6:00 p.m. on the Business Day immediately prior to the Effective Date;
Scheme Shareholders	holders of Scheme Shares;
Scheme Shares	the Alternative Networks Shares:
	(i) in issue at the date of the Scheme Document; (ii) (if any) issued after the date of the Scheme Document and prior to the Voting Record Time; and
	(iii) (if any) issued at or after the Voting Record Time but at or before the Scheme Record Time in respect of which the original or any subsequent holder thereof is bound by the Scheme or shall by such time have agreed in writing to be bound by the Scheme,
	in each case other than any Excluded Shares;
Second Lien Facility	has the meaning given to the expression in paragraph 10 (Financing) of this Announcement;
SMB	small-to-medium sized business;
Substantial Interest	in relation to an undertaking, a direct or indirect interest of 10 per cent. or more of the total voting rights conferred by the equity share capital (as defined in section 548 of the Companies Act) of such undertaking;
Takeover Offer	should the Acquisition be implemented by way of a takeover offer as defined in Chapter 3 of Part 28 of the Companies Act, the offer to be made by or on behalf of Daisy to acquire the entire issued and to be issued ordinary share capital of Alternative Networks and, where the context requires, any subsequent revision, variation, extension or renewal of such offer;
Takeover Panel	the UK Panel on Takeovers and Mergers;
Third Party	each of a central bank, government or governmental, quasi-governmental, supranational, statutory, regulatory, professional or investigative body or authority (including any antitrust or merger control authority), court, trade agency, professional association, institution, works council, employee representative body or any other similar body or person whatsoever in any jurisdiction;
Treasury Shares	any Alternative Networks Shares which are for the time being held by Alternative Networks as treasury shares (within the meaning of the Companies Act);
United Kingdom or UK	the United Kingdom of Great Britain and Northern Ireland;
United States or US	the United States of America, its territories and possessions, all areas subject to its jurisdiction or any subdivision thereof, any state of the United States of America and the District of Columbia;
US Exchange Act	the United States Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder;
Voting Record Time	the date and time specified in the Scheme Document by reference to which entitlements to vote on the Scheme will be determined, expected to be 6.00 pm on the day which is two days before the date of the Court Meeting or, if the Court Meeting is adjourned, 6.00 pm on the second day before the date of such adjourned meeting;
Wider Alternative Networks Group	Alternative Networks, its subsidiary undertakings, associated undertakings and any other undertaking, body corporate, partnership, joint venture or person in which Alternative Networks and/or such undertakings (aggregating their interests) have a direct or indirect Substantial Interest or the equivalent; and
£ or pence	pounds sterling or pence, the lawful currency of the UK.

In this Announcement:

(a) all times referred to are to London time unless otherwise stated;

(b) references to the singular include the plural and vice versa, unless the context otherwise requires;

(c) "subsidiary", "subsidiary undertaking" and "undertaking" have the meanings given by the Companies Act and "associated undertaking" has the meaning given to it by paragraph 19 of Schedule 6 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, other than paragraph 1(b) thereof which shall be excluded for this purpose; and

(d) all references to statutory provision or law or to any order or regulation shall be construed as a reference to that provision, law, order or regulation as extended, modified, replaced or re-enacted from time to time and all statutory instruments, regulations and orders from time to time made thereunder or deriving validity therefrom.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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