Acquisition

K3 Business Technology Group PLC
04 October 2004


4 October 2004


                        K3 BUSINESS TECHOLOGY GROUP PLC
                                     ('K3')

                             ANNOUNCES ACQUISITION
                                       OF
                     MICROSOFT BUSINESS SOLUTIONS SUPPLIER,
                               ALPHA LANDSTEINAR


K3, which provides IT solutions to small and medium-sized companies in the
manufacturing sector, is pleased to announce the acquisition of the entire share
capital of the three companies that together comprise Alpha Landsteinar ('Alpha
Landsteinar').  The three companies are Alpha Landsteinar Limited, Alpha
Landsteinar (Ireland) Limited and Miracle Hindsight Limited.  Alpha Landsteinar
is recognised as one of the leading providers of retail management solutions to
mid-market and large corporates and has been the UK's leading reseller of
Microsoft Navision software for the last four years.

The total consideration for the acquisition is £7.2m, payable in a mix of cash
and shares.  £2.55m in cash and £2.9m in shares is due on completion with £0.7m
in cash deferred for two weeks.  The balance of £1.05m payable in cash is due
within the next twelve months.  The cash consideration is to be funded from the
Company's existing cash resources, an increased bank overdraft facility and a
£750,000 unsecured loan from a company connected with PJ Claesson, a director of
the Company.

Established in 1997 and based in Calne Wiltshire, Alpha Landsteinar sells,
implements and supports Microsoft Navision Business Management software to
companies, predominantly in the retail and distribution sectors.  The software
provides complete solutions for the management of business processes, including
EPOS, inventory management, warehouse control and trends analysis.

Alpha Landsteinar supports over 150 customers, including Carpetright, Adidas,
Dreams, Dobbies Garden Centres and Moss Pharmacy. For the year to 30 June 2004,
Alpha Landsteinar generated aggregated unaudited sales to third-parties of
approximately £8.0m and profit before tax of £0.59m.  Alpha Landsteinar has
enjoyed strong growth over the last three years.

The acquisition of Alpha Landsteinar is a significant step forward in K3's
ambition to extend its business base beyond the manufacturing sector and into
the related markets of retail and distribution.  K3's acquisition, in April
2004, of PSE Ltd, which provides retailers with Microsoft-based applications
(under the 'Elucid' brand) to support multi-channel marketing, warehousing and
supply chain logistics, was the first step in the execution of this strategy.

Andy Makeham, Chief Executive of K3, said,

'This acquisition is an exciting development for us. Alpha Landsteinar is a
fast-growing company, providing a first class, Microsoft-backed product
offering. Its acquisition extends our footprint into retail and distribution,
which we believe offer us good growth opportunities.

We are continuing to examine other acquisitions that will help us to achieve our
objective of building a portfolio of Microsoft business based solutions for the
manufacturing, retail and distribution sectors.'



Enquiries:

K3 Business Technology Group                                T: 01282 864111
Andy Makeham, Chief Executive
David Bolton, Finance Director

Biddicks                                                    T: 020 7448 1000
Katie Tzouliadis




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            The company news service from the London Stock Exchange