Re. Proposed Cancellation of Trading on AIM

Lighthouse Group plc

("Lighthouse", "the Company" or "the Group")

Financial Adviser Awards: Large IFA of the Year

Re. Proposed cancellation of trading on AIM

Further to the announcement made by the Company on 9 July 2012 regarding the proposed cancellation of admission of Ordinary Shares to trading on AIM (the "Cancellation"), and in advance of the General Meeting to be held on 31 July 2012, the Board of Lighthouse would like to reiterate that Shareholders should be aware of the following matters.

Since the announcement on 9 July 2012 there has been some speculation that it is the intention of some or all of the Group's management to take control of the Company. The Board confirms that there is no such intention.

The Board has made its recommendation to Shareholders and is enabling Shareholders to decide on the proposed Cancellation on the basis of the information presented to them. The Board would like to emphasise the reasons behind the proposed Cancellation and the Directors' recommendation to vote in favour of the Resolution:

Following careful consideration, the Directors have therefore concluded that it is no longer in the best interests of the Company or its Shareholders to maintain the Company's admission to trading on AIM and the Board considers that the costs and commercial disadvantages of remaining listed on AIM far outweigh any potential benefits.

The Board is not currently aware of any Shareholders who cannot hold shares in an unquoted company.

Following the proposed Cancellation, it is the Board's intention to set up a matched bargain arrangement with a regulated stockbroker or other specialist to enable Shareholders to trade the Ordinary Shares. A number of specialist entities have already approached the Company in this regard. Once finalised, details of this facility will be published.

The Cancellation is not expected to reduce the Company's high standards of corporate governance, as the Board has undertaken to continue to:

(a) hold regular Shareholder meetings;

(b) maintain non-executive representation on the Board;

(c) operate the Audit, Remuneration and Risk Committees;

(d) review the feasibility of restoring the payment of dividends commensurate with the future profitability, cash availability and underlying growth of the business; and

(e) maintain an "Investors" section on its website at www.lighthousegroup.plc.uk

In addition, Shareholders will be sent an annual report and the Company intends to post a summary of its annual and half year financial performance on its website, as well as details of any significant events or developments in which Shareholders may be interested provided that these are not commercially sensitive.

Recommendation to Shareholders

The Directors consider the Resolution to be in the best interests of the Company and Shareholders as a whole and consider that it is most likely to promote the success of the Company. The Directors therefore unanimously continue to recommend Shareholders to vote in favour of the Resolution at the General Meeting, as they intend to do in respect of their own beneficial holdings.

David Hickey, Chairman of Lighthouse Group, commented:

"The plain truth is the lack of positive sentiment in the Stock Markets for IFA businesses. For Lighthouse, at this time, there are no attractions to being on AIM, and too many disadvantages.

It is crucial that shareholders remember that Lighthouse operates in a highly regulated sector and the proposed delisting should be viewed differently to other businesses in unregulated sectors leaving the market.

Lighthouse will continue to maintain robust standards of corporate governance in addition to abiding by the stringent regulatory, governance and other obligations imposed by the FSA."

Lighthouse is a profitable and cash generative financial services business, providing regulated and other services to over 600 Independent Financial Advisers in the UK.

Capitalised terms used but not defined in this announcement have the same meaning as given to them in the Circular issued on 9 July 2012.

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