Disposal of MAPP

Diagonal PLC
28 March 2001

28th March 2001



                                 DIAGONAL PLC

                      DISPOSAL OF MAPP FOR £1.4 MILLION



Diagonal plc ('Diagonal') announces that it has entered into a conditional
agreement to dispose of its subsidiary MAPP Limited ('MAPP') for £0.8 million,
plus an amount equivalent to net assets. This initial consideration is to be
settled in cash. Diagonal may become entitled to deferred consideration in
certain circumstances, as detailed below.

MAPP is a general IT contract staff agency, providing experienced temporary
staff to clients in commerce and industry. For the year ended 1st December
2000, MAPP made a profit before tax of £117,000 (1999: £520,000) on turnover
of £9.3 million (1999: £12.7million). Net assets at 1st December 2000, were £
666,000 (1999: £585,000).

The disposal of MAPP will allow Diagonal to continue to focus on its declared
strategy of developing higher margin, consultancy led activities, with
stronger growth prospects.

The cash proceeds from the disposal, which are currently expected to amount to
approximately £1.4 million, will be placed on deposit.

Enquiries:

Graham Creswick

Alan Hunter

Diagonal plc

01252 733711



Further information regarding the consideration

The consideration for the disposal comprises:


 a. £800,000 payable in cash at completion of the transaction;

 b. an amount payable in cash equal to the amount of the net assets of MAPP,
    determined following the production of completion accounts, which are
    expected to amount to approximately £600,000;

 c. an amount payable in cash equal to 50% of the amount of the gross profit
    (after deduction of sales commission) generated by certain contracts for
    the 12 month period following completion of the transaction; and

 d. in the event of a sale, flotation or transfer of MAPP or of Howper 348
    Limited (the company purchasing MAPP) ('the Purchaser'), or a sale of
    MAPP's assets (or the Purchaser's assets in the event that MAPP's assets
    have previously been transferred to it):


 i. within 12 months of completion, an amount equal to 50% of the amount by
    which the consideration received for such sale or transfer, or the value
    of MAPP (or the Purchaser as the case may be) in the event of a flotation,
    exceeds the consideration otherwise paid; and

ii. after 12 months and within 24 months of completion, an amount equal to 25%
    of the amount by which the consideration received for such sale or
    transfer, or the value of MAPP (or the Purchaser as the case may be) in
    the event of a flotation, exceeds the consideration otherwise paid.



Related parties

The Purchaser is a company controlled by a management team and Bryan Churcher.
This management team is made up of Peter Rose, Kerry Nash and Christine
Dumbelton. Mr Rose and Mrs Dumbelton are currently directors of MAPP. Kerry
Nash is a director of two subsidiaries of Diagonal. Mr Churcher was a director
of Diagonal until December 1999. Mr Rose, Ms Dumbelton and Mr Nash are
interested in approximately 58% of the equity of the Purchaser. In view of the
interests of these related parties, the disposal of MAPP is conditional on
shareholder approval.