Issue of Equity / Update

Parallel Media Group plc ("PMG" or the "Company")

Update

Completion of changes to business arrangements in Asia and further on
restructuring of financing and £3.57 million fund raising

On 11 September 2006, the Company announced a delay in the date for completion
of the binding heads of agreement (the "Heads") for a rearrangement of its
Asian golf interests previously announced on 16 August 2006. PMG also announced
that it had entered into commitments to raise £3.0 million by the issue of new
shares, convertible loans and loans to enable the repayment of certain loans
and to provide the Company with further working capital.

PMG announces that it has now completed the agreements for the rearrangement of
its Asian business arrangements and redeemed certain loans as previously
announced. It has also entered into agreements to settle further outstanding
convertible loans and certain other creditors by the issue of new ordinary
shares and new convertible loans. as set out below.

As previously announced, PMG has continued to seek further equity funding and
has now entered into an agreement for cash subscriptions of further new
ordinary shares to raise £1 million over the period to January 2007. This
agreement will satisfy the conditions attached to the drawdown of the second
tranches of the two convertible loans detailed in the 11 September 2006
announcement. Further details of these arrangements are set out below.

Following these further agreements, the Company has now received subscriptions
or commitments to subscribe in cash for an aggregate of over £3.57 million
(excluding the £0.40 million of loans from Mr Ciclitira described below), of
which £1.57 million is being subscribed for new ordinary shares, £1.88 million
is being subscribed for convertible loan stock and £0.12 million is being
raised via loans. It is the board's intention that further sums may be raised
by the issue of equity if opportunities arise over the coming months.

Placing

The Company has placed 6,000,000 new ordinary shares of 0.5p at a price of 1.25
pence each raising gross proceeds of £75,000 for the Company.

Existing Convertible Loans

Excluding the convertible loans which were redeemed as part of the
rearrangement of the Company's Asian business, the Company currently has a
total of £2.36 million Exiting Convertible Loans outstanding (including accrued
interest of £0.14 million).

The Company has reached agreement with the holders of £2.21 million of the
Existing Convertible Loans (including £0.14 million of accrued interest)
currently outstanding for the settlement of the outstanding balance by:-

  * the issue of new shares at 1.25 pence
   
  * the issue of a new Unsecured Convertible Loan Stock at 1.25 pence
   
Details of the Existing Convertible Loans are set out below:-

Description of          Amount   Interests held    Conversion Latest redemption
Existing                       by David Cicliti         price              date
Convertible Loan     £ million  ra, director of                                
                                 the Company (£       (pence)                  
                                       million)                                
                                                                               
Tranche 1                £1.11            £1.11          6.75   31 October 2008
                                                                               
Tranche 2                £1.11            £0.41           1.5   31 October 2008
                                                                               
Accrued interest         £0.14            £0.08                                
                                                                               
Total                    £2.36            £1.60                                

The Existing Convertible Loans are secured against assets of the Company. The
latest redemption dates are 31 October 2006, although the holders could have
requested immediate repayment in full.

Settlement of Certain Creditors

The Company has reached agreement for the settlement of certain creditors of
the PMG group totalling £1.38 million, £0.47 million of this balance has been
waived, £0.08 million has been settled in cash and the remaining £0.83 million
being settled by the issue of new shares at a price of 1.25 pence each.

Conversion of Existing Convertible Loans and Certain Creditors into new
ordinary shares and New Unsecured Convertible Loan Stock

The following conversions are taking place:-

Conversion of                   Amount     Number of new    New Unsecured
                                         ordinary shares Convertible Loan
                             £ million      being issued            Stock
                                                                         
Existing Convertible Loans*      £2.21        82,838,877           £1.17m
                                                                         
Certain Creditors**              £1.38        66,733,492             £Nil
                                                                         
Total                                        149,572,369           £1.17m

*including accrued but unpaid interest of £0.14 million

** £224,506 of this balance relates to amounts owed to David Ciclitira.

New Unsecured Convertible Loan Stock

Details of the New Unsecured Convertible Loans are set out below:-

Redemption period 3 months after the publication of the 31 December 2007
accounts

Interest rate Interest free

Conversion price 1.25 pence per share

David Ciclitira and interests associated with him will hold the entire New
Unsecured Convertible Loan Stock. Mr Ciclitira has confirmed to PMG that it is
his intention to exercise his conversion rights whenever it is reasonably
possible to do so, and to substantially the maximum extent possible, so long as
it will not require the interests of Mr Ciclitira (and any persons deemed to be
acting in concert with him) to make an offer for the balance of the ordinary
share capital then in issue under Rule 9 of the City Code on Takeovers and
Mergers.

Further share issue

The Company has entered into a contract with Pacific Continental Securities
(UK) Ltd ("Pac Con") which contains four put and call options (exercisable by
PMG and Pac Con respectively) each for the cash subscription of £250,000 for
new ordinary shares. One put and call option may be exercised in the month of
October 2006, one in the month of November 2006, one in the month of December
2006 and the fourth in the month of January 2007. Each option is exercisable at
sixty five per cent. of the average middle market price of PMG's shares for the
three business days prior to exercise (subject to a minimum price of the par
value of the shares).

Allotment of shares and application for admission to AIM

The Company has today allotted 155,572,369 new ordinary shares of 0.5p each in
connection with the Placing and the conversion of loan notes set out above.

Application has been made for 155,572,369 new Ordinary Shares of 0.5p each to
be admitted to trading on AIM and it is anticipated that such admission will
become effective and that dealings in the new ordinary shares will start on 4
October 2006.

Following the above issue of shares the newly enlarged share capital of the
Company is 219,175,874 ordinary shares of 0.5 pence.

Grant of options

The Board indicated last year that it intended to establish a new Executive
Share Scheme and intended to grant options over 10 per cent of the enlarged
fully diluted share capital as it then was. This did not happen. The Board has,
however, today agreed to adopt such a scheme with a cap of 10 per cent of the
ordinary shares in issue from time to time. The Board has also today agreed to
offer options to members of the board and to senior management of the PMG Group
over 17,465,000 ordinary shares.

The terms of the warrants are set out below:-

Exercise Price:- 1.25 pence

Exercise period:- 7 years from date of grant

The options will be subject to the Company meeting certain profit targets in
respect of the years ended 31 December 2007 and 31 December 2008.

Included in the option grants are the following directors of the Company:-

                                 Number of shares under
                                                warrant
                                                       
David Ciclitira                               9,605,750
                                                       
Edward Adams                                  2,619,750
                                                       
Total                                        12,225,500

Related party statement

£1,603,509 of the Existing Convertible Loans (including accrued interest) are
held by David Ciclitira and his associated interests. As part of the
arrangements described above, such loans are being satisfied by the issue of
new ordinary shares and New Unsecured Convertible Loan Stock based on a price
of 1.25p per share. Such terms for the issue of new ordinary shares are
identical to those offered to all other holders of existing convertible loans.

Included in the settlement of other creditors of £1.38 million outlined above,
£122,506 of this balance is owed historically to interests associated with
David Ciclitira which is to be settled by the issue of new ordinary shares
based on a price of 1.25 pence.

David Ciclitira has advanced £400,000 of unsecured loans to the Company, on an
interest free basis, over recent months. The Company has agreed to repay these
loans as soon as it is able to up to 30 June 2007, if these loans are not
repaid by 30 June 2007, they may become at the election of Mr. Ciclitira an
interest free convertible loan, convertible at any time until repaid on the
basis of a share price of 1.25p.

In consideration for David Ciclitira providing the unsecured loans to the
Company up to the point of the fund raising he is being paid a fee of £60,000,
this fee being satisfied by the issue of new ordinary shares at 1.25 pence
(included in the £1.38 million outlined above).

David Cicilitira has agreed to provide a personal guarantee as security for a
bridging loan facility which the Company has negotiated of up to £300,000 if
needed to enable completion of the Malaysian Agreements to take place. The
Company has agreed to pay Mr Ciclitira a fee equivalent to 14 per cent. of the
funds drawn down in reliance on this guarantee, such fee to be settled by the
issue of new ordinary shares based on a price of 1.25p (included in the £1.38
million outlined above).

Interests associated with Edward Adams have made a facility of £100,000
available to PMG to enable completion of the agreements on a timely basis. Such
facility, if drawn, will bear interest at 6% per annum and will have the
benefit of security over certain of the assets being acquired by the Group. A
facility fee of 5% is also being paid in relation to this loan.

As indicated above, certain of the options granted under the share option
scheme described above are being granted to directors, including non-executive
directors. These options are on the same basis as the options granted to senior
management of PMG.

In the case of each of the above transactions, the Board (other than the
director or directors involved in the relevant transaction), having consulted
with City Financial Associates Limited, the Company's Nominated Advisor,
consider the terms to be fair and reasonable insofar as shareholders are
concerned.

Subsequent to the above transactions David Ciclitira has a holding of
64,673,719 ordinary shares in the Company representing approximately 29.5 per
cent. of the issued share capital of the Company.

3 October 2006

For further information, contact:

David Ciclitira, Chairman, Parallel Media Group plc 020 7225 2000