Placing and acquisition

Ideagen plc

("Ideagen" or the "Company")

Acquisition and Placing of £6 million

Ideagen, a leading supplier of Compliance based Information Management Software, is pleased to announce the acquisition of the entire issued share capital of Plumtree Group Limited ("Plumtree"), a UK based business supplying Information Management software to the Healthcare Sector for total consideration of £2.5 million ("the Acquisition"). The Acquisition is in line with the Company's strategy of acquiring profitable businesses with IP and recurring revenues that supply Information Management Solutions to highly regulated sectors.

In addition, the Company is pleased to announce that it has raised £6 million (before expenses) via a placing of new ordinary shares of 1 penny each in the share capital of the Company ("Ordinary Shares") to both new and existing investors.

Transaction Highlights

·; Acquisition of Plumtree, a UK based business supplying Information Management software to the healthcare sector

·; Offers cross selling opportunities and entry point into UK healthcare sector

·; Acquisition consideration of £2.5 million, £1.6 million payable in cash, £0.9 million payable in new Ordinary Shares at 20 pence per Ordinary Share

·; Placing to raise £6 million to fund the cash consideration and future acquisitions

·; Consideration represents Enterprise Value of £2.3 million net of cash in the business and historic EV/EBITDA multiple of 5.1

Commenting on the Acquisition and Placing, David Hornsby, CEO of Ideagen, commented:

"We are delighted to have completed the acquisition of Plumtree, in line with our stated strategy, which enhances the breadth of our UK operations and builds on our recent success in the US healthcare sector. Plumtree's substantial and growing customer base is testament to the quality of its software, underpinned by strong IP, and will provide substantial cross-selling opportunities going forward."

About Plumtree

Plumtree develops and sells Information Management software and has two primary products: dartEDRMS (clinical document management) and dartOCM (order communications for clinical services and results reporting).

In the year to 31 March 2012, Plumtree generated revenues of £2.44 million, of which £0.9 million are recurring, and EBITDA of £0.45 million. Net assets were £0.3 million as at 31 March 2012.

Plumtree has in excess of 125 NHS customers, both Foundation and Primary Care Trusts and has strategic partnerships with Abbot Diagnostics and Cruinn Diagnostics. In December 2011 Plumtree won the Framework contract for NHS Scotland for the supply of Electronic Document Management.

Details of the Placing

To fund the cash element of the consideration for Plumtree and for future acquisitions, Ideagen announces that it has raised £6 million, before expenses, by way of a placing (the "Placing") of 31,578,948 new Ordinary Shares (the "Placing Shares") at a price of 19 pence per share (the "Placing Price"). The Placing Price represents a premium of approximately 1.33 per cent. to the closing mid-market price of 18.75 pence per Ordinary Share on 14 December, being the last practicable day prior to this announcement.

The Placing Shares will, following allotment, rank pari passu with the existing Ordinary Shares.

The Placing Shares will be admitted in two tranches to trading on AIM. Application has been made to the London Stock Exchange for 11,577,106 Ordinary Shares to be admitted to trading on AIM (the "First Admission"). Additionally, application has been made to the London Stock Exchange for 4,500,000 new Ordinary Shares issued in conjunction with the Acquisition (the "Vendor Shares") to be admitted to trading on AIM. The First Admission is expected to take place at 8.00 a.m. on 19 December 2012 and admission of the Vendor Shares is expected to take place at 8.00 a.m. on 21 December 2012.  

An element of the Placing is conditional upon shareholder approval. Application will be made to the London Stock Exchange for 20,001,842 Ordinary Shares to be admitted to trading on AIM pending shareholder approval (the "Second Admission"). The Second Admission is expected to take place at 8.00 a.m. on 10 January 2013.

The first tranche of Placing Shares has been arranged using the authority granted to Directors at the Company's annual general meeting held on 31 October 2012. The second tranche of Placing Shares remains subject to shareholder approval at a General Meeting convened for 7 January 2013. 

After the First Admission, the total number of Ordinary Shares in issue will be 89,458,664. The total number of voting rights will therefore be 89,458,664. Following admission of the Vendor Shares, the total number of Ordinary Shares in issue will be 93,958,664. The total number of voting rights will therefore be 93,958,664.

The above figures may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FSA's Disclosures and Transparency Rules.

Notice of General Meeting

The Company will hold a General Meeting, at the offices of FinnCap Ltd, 60 New Broad Street, London, EC2M 1JJ at 11.00 a.m. on 7 January 2013, at which resolutions will be proposed to grant the Directors the authority to allot the second tranche of Placing Shares and further to allot such Placing Shares without first offering them to existing Shareholders on a pre-emptive basis. Notice of General Meeting will be posted to Shareholders in the next week.