Directors' Dealings & Other News

Diagonal PLC
2 March 2000


DIAGONAL PLC ('Diagonal' or 'the Company')
Cash placing

DIAGONAL  is pleased to announce that it has today entered into an arrangement
to  place 1,179,775 new ordinary shares of 10p each ('Ordinary Shares') at 890
pence  per  share (the 'Placing') to raise approximately £10.3  million  after
expenses.  It is expected that the new Ordinary Shares will be admitted to the
Official List of the London Stock Exchange on Thursday 9 March 2000.  The  new
shares will rank pari passu with the existing shares in all respects including
the  right to the final dividend of 1.0 pence per share to be paid to  holders
of Ordinary Shares who are on the register on 10 March 1999.

As  stated in the Company's preliminary announcement for the 52 weeks ended 28
November  1999 made on 22 February 2000, the Company has been building  a  new
revenue  stream under the banner DIAGONAL Solutions.  To that end,  since  the
year end the Company has made two acquisitions resulting in a cash outflow  of
£6.8  million and some limited use of the Company's overdraft facilities.   It
is   the  Directors'  intention  that  the  Company  will  continue  to   make
acquisitions  in  order to develop the DIAGONAL Solutions group  and  the  net
proceeds  from  the cash placing, which will initially be placed  on  deposit,
will be used to finance such future acquisitions.

In  addition,  today  the directors of the Company have  sold,  in  aggregate,
2,479,802  Ordinary Shares at 890 pence per share.  Details of  the  disposals
are set out below:

Name of director       No. of Percentage    Holding Percentage
                       shares        of   following         of
                         sold   existing   disposal   existing
                                   share                 share
                                 capital               capital
Mark Samuels          882,628       1.07  2,647,884       3.20
Colin Burnside      1,076,083       1.30  3,228,249       3.90
Victor Tuffield       446,750       0.54  1,340,250       1.62
Graham Creswick        74,341       0.09    223,023       0.27

Also today Bryan Churcher has sold, 834,564 Ordinary Shares, representing 1.01
per  cent.  of  the Company's existing share capital at 890 pence  per  share.
Following the disposal Bryan Churcher and his related interests will  continue
to  hold  2,503,694  Ordinary  Shares, representing  3.02  per  cent.  of  the
Company's existing share capital.


For Further Information:

Mark Samuels, Chairman
DIAGONAL PLC
01252 733711

Graham Creswick, Finance Director
DIAGONAL PLC
01252 733711

Richard Pollen
Pollen Associates
01428 608860

James Grace, Managing Director
Investec Henderson Crosthwaite Corporate Finance
020 7597 5970