Acquisition

Release date: 12th May 2006

For Immediate Release

   CLS HOLDINGS PLC ("CLS") ANNOUNCES THAT IT HAS ACQUIRED FURTHER SHARES IN   
                                 LUNARWORKS AB                                 

CLS announces that it has acquired further shares in Lunarworks AB
("Lunarworks"), increasing its shareholding from 5,016,650 shares, representing
approximately 47.2 per cent of the issued share capital, to 10,324,000 shares,
representing approximately 97.07 per cent of the issued share capital. These
shares have all been acquired at a price of SEK 35 per share (£2.59) which
values Lunarworks at approximately SEK 372 million (£28 million). The cost of
the entire investment for CLS is £16.9 million, providing an annual return of
over 10%.

As a result of these acquisitions, CLS is able to compulsorily acquire the
outstanding shares not already owned by it.

Sten Mortstedt, Executive Chairman of CLS, owned 665,150 ordinary shares in
Lunarworks representing approximately 6.3 per cent of the issued share capital
and he has accepted the offer from CLS on the same terms as offered to all
other shareholders.

Lunarworks is a private Swedish company which was established in 1999 as a
start-up, in which CLS first invested in 2000. It is an internet-based youth
community generating revenues from advertising and membership fees and
services. In the year to December 2005, it produced revenues of £5.2 million
and generated EBITDA of £1.9 million from ongoing operations. Lunarworks
launched its UK operation successfully in November 2005. Earnings from ongoing
operations grew by more than 30 per cent in 2004 and by 156 per cent in 2005.
Earnings are 48 per cent higher in the first quarter 2006 compared to the same
period last year. Cash at bank at 31st December 2005 amounted to £2.6 million.

Sten Mortstedt commented:

"Lunarworks has grown successfully, is well capitalized and profitable. It is
now, expanding internationally and is already generating a good return on
investment. CLS has rationalised its portfolio of investments significantly
over the last two years and we believe this opportunistic acquisition of the
outstanding shares of Lunarworks will provide a good return to our shareholders
in the future."

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For further information, please contact:

Sten Mortstedt, Executive Chairman

Per Sjöberg, Chief Executive Officer

Steven Board, Chief Operating Officer

CLS Holdings plc

www.clsholdings.com

Tel. [phone]

Adam Reynolds/Ben Simons

Hansard Communications

Tel. [phone]