Sale of View - D business

Prime Focus London plc

(the "Company")

Sale of View-D business

The Company today announces that is has entered into an agreement to sell its View-D 2D to 3D conversion business to Prime Focus International Services Limited, a wholly owned subsidiary of the Company's majority shareholder, Prime Focus Limited.

Under the terms of the agreement, the Company's subsidiary, Prime Focus Visual Entertainment Services Limited will sell fixed assets of US$ 1.8 million (approximately £1.15 million) and the activities of the business including employment contracts for a total consideration of US$ 3.3 million (approximately £2.1 million), comprising a cash consideration of US$ 500,000 and the write-off of a debt of US$ 2.8 million. The cash received will be used to provide additional working capital for the Prime Focus London plc group ("the Group").

During the year ended 31 March 2011, the View-D division made a loss of £3.7 million on sales of £8.7 million. The division has continued to make losses since 31 March 2011 and the directors of the Company ("Directors") do not believe that the View-D division would become profitable in the foreseeable future. In part, this is the result of having to bear the cost of a non-exclusive license fee of US$1 million per quarter payable for the use of the View-D software that belongs to the Prime Focus Limited group.

As Prime Focus Limited is a substantial shareholder of the Company, it is classified as a related party of the Company under the AIM Rules for Companies and, accordingly, the sale of the View-D business falls to be treated as a related party transaction under Rule 13 of the AIM Rules for Companies. The independent directors, having consulted with the Company's nominated adviser, consider that the terms of the transaction are fair and reasonable insofar as the Company's shareholders are concerned.

The disposal of the business is expected to be earnings enhancing and will allow management to concentrate on the Group's core business. The Directors also believe that it will be easier for the streamlined Group to enter into a corporate transaction that could enhance shareholder value.

Enquiries: