Return of Capital - Corero Network Security plc

15th March 2012

LOUDWATER TRUST LIMITED

("LOUDWATER" OR "THE COMPANY")

RETURN OF CAPITAL - B SHARE ISSUE

Loudwater Trust Limited, the closed-ended investment company, is pleased to announce that following the sale of the Company's listed shares in Corero Network Security plc, the Board of Directors have approved a return of £1.854 million of capital to shareholders, equating to approximately 3.08 pence per share.

The capital will be returned by way of a bonus issue of B shares to shareholders pro rata to shareholders' existing holdings of ordinary shares in the capital of the Company. The B shares will be issued to shareholders on the Company's register on the record date of 23 March 2012 and will have an ex-date of 21 March 2012.

Following their issue, the Directors are expected to consider the redemption of the issued B shares on or around 26 March 2012. A subsequent announcement will then be released confirming the decision of the Board.

The Company's investing policy is to return the cash proceeds of all realisations to investors, subject to the retention of sufficient cash for follow-on investments in existing portfolio companies where the Investment Adviser believes further funding is required.

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http://www.loudwatertrust.com