Return of Capital

THE TENDER OFFER IS NOT BEING MADE, DIRECTLY OR INDIRECTLY, IN OR INTO, OR BY USE OF THE MAILS OF, OR BY ANY MEANS OR INSTRUMENTALITY OF INTERSTATE OR FOREIGN COMMERCE OF, OR ANY FACILITIES OF A NATIONAL SECURITIES EXCHANGE OF UNITED STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA.

IFG Group plc ("IFG" or the "Company")

Proposed Return of Capital

On 31 August 2012, in the announcement of the Company's interim results for the six months ended 30 June 2012, the Board announced a proposal to return circa £30 million capital to shareholders via a share buyback initiative. The Board now confirms its intention to proceed with the proposed return of capital of €37.3 million (£30.0 million) to Shareholders by way of a Tender Offer. The Board has been advised by Davy Corporate Finance in relation to the Tender Offer.

The Tender Offer is being made to Qualifying Shareholders at a price per share of €1.65 and tenders may be made at the Tender Price only. The Tender Price represents a premium of 17.9 per cent to the closing price of €1.40 per Ordinary Share on 1 November 2012 (being the Latest Practicable Date) and represents a premium of 13.9 per cent to the volume weighted average price per Ordinary Share over the three month period to 1 November 2012.

Qualifying Shareholders are not obliged to tender any or all of their Ordinary Shares if they do not wish to do so.

A circular (the "EGM Circular"), containing the formal terms and conditions of the Tender Offer and instructions to Shareholders on how to tender their Ordinary Shares should they choose to do so, together with a Tender Form and a Form of Proxy, have been today posted to Shareholders. The EGM Circular also contains a notice of Extraordinary General Meeting ("EGM") to be held at Radisson Blu St Helen's Hotel, Stillorgan Road, Dublin 4, Ireland at 10.00 a.m. on 28 November 2012 to consider the resolutions necessary to implement the Tender Offer. The EGM Circular includes a recommendation from the Board of IFG to vote in favour of the resolutions to be considered at the EGM.

The Company intends to publish its interim management statement on 14 November 2012.

Capitalised terms in this announcement have, unless otherwise stated, the same meaning as set out in the EGM Circular. All references to time in this announcement are to Irish Standard Time.

A copy of the EGM Circular will be available for inspection at www.ifggroup.com.

BACKGROUND TO AND REASONS FOR THE TENDER OFFER

On 5 July 2012, the Company completed the disposal of IFG International for £70 million. Following the disposal, the Board, in consultation with its advisers, reviewed a number of factors including:

·; the Group's current net cash position;

·; the Group's ongoing earnings and cash flow generation;

·; the Group's optimal capital structure;

·; acquisition and investment opportunities; and

·; the relatively low interest income capable of being generated by the Group's current cash balance.

The Board concluded, following consultation with the Company's advisers, that the reduction of bank debt and the return of up to €37.3 million of capital by way of the Tender Offer is in the best interests of the Group and Shareholders as a whole, as it places the Group in a financially strong and flexible position and provides Shareholders with both choice (that is, the discretion to participate in the Tender Offer) and certainty of value by providing Qualifying Shareholders who wish to sell their Ordinary Shares with an opportunity to do so at a fixed price. The Tender Offer is expected to have a positive effect on both the Company's earnings per share and dividend per share measures.

As at the date of the EGM Circular, the Company has satisfied itself that it will have sufficient Profits Available for Distribution at the Closing Date to implement the Tender Offer.

Those Qualifying Shareholders who do not wish to participate in the Tender Offer can retain their full existing investment in the Company.

Benefits of the Tender Offer

The benefits of the Tender Offer, compared to other available options for a return of capital to Shareholders, are that the Tender Offer:

a) provides Qualifying Shareholders who wish to sell their Ordinary Shares with the opportunity to do so;

b) enables those Qualifying Shareholders who do not wish to receive capital at this time to maintain their full investment in the Company;

c) is available to all Qualifying Shareholders regardless of the size of their shareholdings;

d) means Qualifying Shareholders will receive a premium of 17.9 per cent to the closing price of €1.65 per Ordinary Share on 1 November 2012 (being the Latest Practicable Date) and represents a premium of 13.9 per cent to the volume weighted average price per Ordinary Share over the three month period to 1 November 2012;

e) means Qualifying Shareholders will receive their full entitlement to the interim dividend announced on 31 August 2012 on any Ordinary Shares tendered;

f) ensures an equal opportunity to all Qualifying Shareholders to participate in the return of capital by offering a Guaranteed Entitlement; and

g) will have a sustainable positive impact on the Company's earnings per share and dividend per

share as all shares acquired under the Tender Offer will be cancelled.

The Tender Offer will provide all Qualifying Shareholders with an opportunity to sell part of their respective shareholdings and to receive their respective share of the capital which the Company is seeking to return. Qualifying Shareholders may also be able to participate in excess of their Guaranteed Entitlement, potentially up to their maximum shareholding in the Company, to the extent that other Qualifying Shareholders do not wish to participate in the Tender Offer in respect of their respective Guaranteed Entitlements.

DETAILS OF THE TENDER OFFER

Full details of the Tender Offer, including the terms and conditions on which it is being made, are set out in Part III of the EGM Circular and in the Tender Form. Qualifying Shareholders do not have to tender any Ordinary Shares if they do not wish to do so.

The Tender Offer is conditional on:

(i) the passing of Resolutions 1 and 2 as set out in the EGM Notice;

(ii) the receipt of valid tenders in respect of at least 11,301,818 Ordinary Shares representing approximately 8.94 per cent of the Company's Existing Issued Ordinary Share Capital by 11.00 a.m. on 3 December 2012;

(iii) the Tender Offer not having been terminated in accordance with paragraph 10 of Part III (Terms and Conditions of the Tender Offer) of the EGM Circular prior to 11.00 a.m. on 3 December 2012; and

(iv) the Company having sufficient Profits Available for Distribution at the Closing Date to implement the Tender Offer.

The Tender Offer is being made to Qualifying Shareholders on the register of members of the Company on the Record Date in respect of their Ordinary Shares held on the Record Date.

Under the Tender Offer:

• The Company will purchase up to 22,603,636 Ordinary Shares from Qualifying Shareholders at the Tender Price. These Ordinary Shares will subsequently be cancelled by the Company.

• There is no obligation on Qualifying Shareholders to participate in the Tender Offer.

·; Each Qualifying Shareholder will be entitled to sell up to approximately 17.87 per cent of the Ordinary Shares registered in their name on the Record Date under the Tender Offer, rounded down to the nearest whole number of Ordinary Shares (as adjusted in the event that any outstanding options to subscribe for Ordinary Shares are exercised before the Record Date). Qualifying Shareholders may sell more than their Guaranteed Entitlement to the extent that other Qualifying Shareholders tender less than their Guaranteed Entitlement.

·; If the aggregate purchase price for all Ordinary Shares tendered is €37.3 million or less, all Ordinary Shares validly tendered will be accepted and purchased at the Tender Price, subject to the receipt of valid tenders in respect of at least 11,301,818 Ordinary Shares.

·; However, if the aggregate purchase price for all validly tendered Ordinary Shares exceeds €37.3 million, not all of the Ordinary Shares validly tendered will be accepted and purchased. In these circumstances, the number of Ordinary Shares which will be accepted and purchased will be calculated as follows:

(i) all Ordinary Shares validly tendered by Qualifying Shareholders up to their respective Guaranteed Entitlements will be accepted and purchased in full; and

(ii) all Ordinary Shares tendered by Qualifying Shareholders in excess of their Guaranteed Entitlements will be scaled down pro rata to the total number of such Ordinary Shares tendered in excess of the aggregate Guaranteed Entitlement, such that the total cost of Ordinary Shares purchased pursuant to the Tender Offer does not exceed €37.3 million;

• All of the Directors, who hold Ordinary Shares which represent approximately 6.9 per cent of the Existing Issued Ordinary Share Capital of the Company as at the Latest Practicable Date, intend to vote in favour of the Resolutions in respect of their own holdings of Ordinary Shares.

Ordinary Shares not validly tendered will not be purchased. Ordinary Shares purchased pursuant to the Tender Offer will be purchased free of commissions and dealing charges.

Ordinary Shares successfully tendered under the Tender Offer will be purchased by the Company and subsequently cancelled and will not rank for any future dividends. However, the interim dividend of 1.65 cent per Ordinary Share will be paid on 14 December 2012 in respect of any Ordinary Shares successfully tendered under the Tender Offer.

The issued ordinary share capital of the Company at the Latest Practicable Date was 126,471,801 Ordinary Shares. If the Tender Offer is implemented in full, this will result in the purchase of 22,603,636 Ordinary Shares (17.87 per cent of the Existing Issued Ordinary Share Capital) and the issued ordinary share capital of the Company following cancellation of the Ordinary Shares so purchased will be 103,868,165 (assuming no further options to subscribe for Ordinary Shares are exercised in the interim).

The total number of options to subscribe for Ordinary Shares that are outstanding at the Latest Practicable Date (the 'Share Options') is 2,997,000. The total number of Ordinary Shares that could be earned under the LTIP (the 'LTIP Shares') at the Latest Practicable Date is 2,700,000. The number of Share Options and LTIP Shares will not be changed in connection with the Tender Offer and will accordingly remain unchanged immediately following the completion of the Tender Offer (save to the extent that any outstanding options are exercised in the interim). The proportion of the issued ordinary share capital that they represent as at the Latest Practicable Date is 4.5 per cent and the proportion of the issued ordinary share capital that they will represent if the Tender Offer is implemented in full is 5.5 per cent. As at the Latest Practicable Date there are no outstanding warrants to subscribe for Ordinary Shares.

OVERSEAS SHAREHOLDERS

The attention of Shareholders who are not resident in Ireland or the United Kingdom is drawn to paragraph 11 of Part III of the EGM Circular.

EXTRAORDINARY GENERAL MEETING

The EGM will be held at the Radisson Blu St Helen's Hotel, Stillorgan Road, Dublin 4, Ireland at 10.00 a.m. on 28 November 2012, at which Shareholders will be asked to consider and, if thought fit, to pass the Resolutions. The implementation of the Tender Offer is conditional on, inter alia, the passing of Resolutions 1 and 2 in the EGM Notice. If Resolutions 1 and 2 are not passed by Shareholders at the EGM, the Company will not implement the Tender Offer.

NOTIFICATION OF INTERESTS

Following the Company's proposed purchase of Ordinary Shares arising from the Tender Offer a Shareholder's interest in the Company's issued share capital may change, giving rise to an obligation on the Shareholder in question to make a notification or a further notification to the Company under the Companies Acts, 1963 to 2012 and/or the Transparency Regulations and/or the Transparency Rules.

If Shareholders are in any doubt as to whether they should make a notification to the Company, or as to the form of that notification then Shareholders are advised to consult their solicitor or other professional adviser without delay.

TENDER OFFER TIMETABLE

For Further Information:

If Shareholders are in any doubt as to the action you should take, you are recommended to seek your own financial advice immediately from an independent financial adviser being, if you are resident in Ireland, an organisation or firm authorised or exempted under the European Communities (Markets in Financial Instruments) Regulations 2007 (Nos. 1 to 3) (as amended) of Ireland or the Investment Intermediaries Act 1995 (as amended) of Ireland or, if you are resident in the United Kingdom, an organisation or firm authorised pursuant to the Financial Services and Markets Act 2000 (as amended) of the United Kingdom or, in the case of shareholders resident outside Ireland and the United Kingdom, from another appropriately authorised independent financial adviser.

This Announcement does not constitute, or form part of, any offer for or invitation to sell or purchase any securities, or any solicitation of any offer for, securities in any jurisdiction. Any acceptance or other response to the Tender Offer should be made only on the basis of information contained in or referred to in the EGM Circular. The EGM Circular will contain important information, including the full terms and conditions of the Tender Offer, which shareholders are urged to read carefully.

The Tender Offer is not being made in or into, and is not capable of acceptance in or from, the United States, Canada, Australia, Japan or the Republic of South Africa. Custodians, nominees and trustees should observe these restrictions and should not send or distribute documents in or into the United States, Canada, Australia, Japan or the Republic of South Africa.