Offer for MV Sports Group plc

Tandem Group PLC
03 February 2003


3 February 2003


For immediate release


NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO CANADA, AUSTRALIA OR
JAPAN



                              Tandem Group plc


Recommended Offer for the acquisition of MV Sports Group Plc by Tandem Group plc
by means of a scheme of arrangement under section 425 of the Companies Act 1985


                 Trading statements by Tandem and MV Sports


                         New Tandem banking facilities



The boards of directors of MV Sports and Tandem today announce a recommended
offer ('Offer') for Tandem to acquire the entire issued and to be issued share
capital of MV Sports. If approved by MV Sports Shareholders, MV Sports Scheme
Shareholders, Tandem Shareholders and the Court, the Offer will be implemented
by way of a scheme of arrangement (the 'Proposal') under section 425 of the
Companies Act ('the Scheme'). If the Scheme becomes effective, under its terms
all the MV Sports Scheme Shares will be cancelled and MV Sports Scheme
Shareholders will receive Tandem Ordinary Shares in consideration on the
following basis:



For every 43 MV Sports Shares held on the Record Date, 2 Tandem Ordinary Shares.



The consideration values the whole of the current issued share capital of MV
Sports at £4,258,942.  The middle market price of a Tandem Ordinary Share at the
close of business on 31 January 2003 was 3.5p, being the latest practicable date
prior to the making of this announcement. The consideration offered therefore
represents a premium of 16.3 per cent. to the price of 0.14p, being the middle
market price of a MV Sports Share at the close of business on 31 January 2003,
being the latest practicable date prior to the making of this announcement.
Tandem is planning a share capital reorganisation which, if approved by its
shareholders, will result in an effective consolidation of the Tandem Ordinary
Shares on a ten for one basis prior to the Scheme becoming effective.
Therefore, if the Tandem Share Capital Reorganisation does proceed then MV
Sports Scheme Shareholders will instead receive 2 New Tandem Shares for every
430 MV Sports Shares held on the Record Date.



The full announcement, which follows this summary, contains statements regarding
current trading by Tandem and by MV Sports and details of new Tandem bank
facilities.



The Offer is subject to the conditions set out in Appendix I, including the
approval of the MV Sports Scheme Shareholders at the Court Meeting, the passing
of a resolution at the MV Sports EGM, the passing of certain resolutions at the
Tandem EGM and the sanction of the Court.



The MV Sports Directors, who have been so advised by Seymour Pierce, consider
the terms of the Scheme to be fair and reasonable and in the best interests of
MV Sports Shareholders as a whole. In providing advice to the MV Sports
Directors, Seymour Pierce has taken into account the MV Sports Directors'
commercial assessment.



Graham Waldron, Chairman of Tandem, said today:



'We believe that the two businesses are an excellent fit for each other with
complementary product ranges and a significant number of products which are or
which could be sold into the same customer base. Effecting the Proposal will
give the enlarged group a larger base to grow from and save the costs of running
two publicly traded companies.'




Stephen Grant, Managing Director of MV Sports, said today:



'We have seen that consolidation in our sector is inevitable given market
conditions and believe that MV Sports Shareholders will welcome the opportunity
to exchange their MV Sports Shares at a premium to today's market price for
shares in a larger public company with a higher market capitalisation.  We see
Tandem as an excellent fit with our business and that there is an opportunity to
increase market share and margin contribution by joining Tandem whilst, at the
same time, achieving diversification into new business areas.'



The above summary should be read in conjunction with the full text of this
announcement which follows this summary.



Contacts:



For Tandem

Mervyn Keene, Finance Director, Tandem                     01733 211399
Adam Hart, KBC Peel Hunt                                   020 7418 8900                                              
David Haggie/Peter Rigby, Haggie Financial                 020 7417 8989


For MV Sports

Stephen Grant, Managing Director, MV Sports                0121 748 8000
Mark Percy, Seymour Pierce                                 020 7648 8700
Nick Dibden, Weber Shandwick Fleet Financial               020 7067 0700



The conditions to the Proposal are set out in Appendix I, and definitions of
certain expressions used in this announcement are set out in Appendix II.



KBC Peel Hunt, which is regulated in the United Kingdom for the conduct of
investment business by the Financial Services Authority, is acting for Tandem
and no one else in connection with the Proposal and will not be responsible to
anyone other than Tandem for providing the protections afforded to customers of
KBC Peel Hunt nor for providing advice in relation to the Proposal, this
announcement or any other matters referred to herein.



Seymour Pierce, which is regulated in the United Kingdom for the conduct of
investment business by the Financial Services Authority, is acting for MV Sports
and no one else in connection with the Proposal and will not be responsible to
anyone other than MV Sports for providing the protections afforded to customers
of Seymour Pierce nor for providing advice in relation to the Proposal, this
announcement or any other matters referred to herein.



This announcement does not constitute an offer to sell or invitation to purchase
any securities or the solicitation of any vote or approval in any jurisdiction.



The release, publication or distribution of this announcement in certain
jurisdictions may be restricted by law and therefore persons in such
jurisdictions into which this announcement is released, published or distributed
should inform themselves about and observe such restrictions.



The Offer will not be made directly or indirectly in or into or by the use of
the mails of, or any other means or instrumentality of interstate or foreign
commerce of, or any facility of a national securities exchange of Canada,
Australia or Japan.  Accordingly, this document is not being, and must not be
issued, mailed or otherwise distributed or sent in, into or from Canada,
Australia or Japan and persons receiving this document (including custodians,
nominees and trustees) must not distribute or send it in, into or from Canada,
Australia or Japan.



The Tandem Consideration Shares, if approved, will not be registered under the
Securities Act or under any relevant securities laws of the United States, nor
have the relevant clearances been, nor will they be, obtained from the
securities commission or similar authority of any province or territory of
Canada, and no prospectus has been or will be filed, or registration made, under
any securities law of any province or territory of Canada, nor has a prospectus
in relation to the Tandem Consideration Shares, been, nor will one be, lodged
with or registered by the Australian Securities and Investments Commission nor
have any steps been taken, nor will any steps be taken, to enable the Tandem
Consideration Shares to be offered in compliance with applicable securities laws
of Japan, nor will the offer of Tandem Consideration Shares be registered with
the Securities and Futures Commission of the Republic of China pursuant to
relevant securities laws and regulations.  Accordingly, unless an exception
under the Securities Act or such securities laws is available, none of the
Tandem Consideration Shares may be offered, sold, resold or delivered, directly
or indirectly, in, into or from the United States, Canada, Australia or Japan or
any other jurisdiction in which an offer of Tandem Consideration Shares would
constitute a violation of relevant laws or require registration thereof, or to
or for the account or benefit of any US Person or resident of Canada, Australia
or Japan.


                                Tandem Group plc


Recommended Offer for the acquisition of MV Sports Group Plc by Tandem Group plc
by means of a scheme of arrangement under section 425 of the Companies Act 1985


                   Trading statements by Tandem and MV Sports


                           New Tandem banking facilities


                                     PART 1



1.         Introduction



The boards of directors of MV Sports and Tandem today announce a recommended
offer by Tandem to acquire the entire issued and to be issued share capital of
MV Sports. If approved by MV Sports Shareholders, MV Sports Scheme Shareholders,
Tandem Shareholders and the Court, the Offer will be implemented by way of a
scheme of arrangement under section 425 of the Companies Act.





2.         The Offer



The Offer,  is to be implemented by way of the Scheme.  If the Scheme becomes
effective, under its terms all the MV Sports Scheme Shares will be cancelled and
MV Sports Scheme Shareholders will receive Tandem Ordinary Shares in
consideration on the following basis:



For every 43 MV Sports Shares held on the Record Date, 2 Tandem Ordinary Shares.



The consideration values the whole of the current issued share capital of MV
Sports at £4,258,942.  The middle market price of a Tandem Ordinary Share at the
close of business on 31 January 2003 was 3.5p, being the latest practicable date
prior to the making of this announcement. The consideration offered therefore
represents a premium of 16.3 per cent. to the price of 0.14p, being the middle
market price of a MV Sports Share at the close of business on 31 January 2002,
being the latest practicable date prior to the making of this announcement.
Tandem is planning a share capital reorganisation which, if approved by its
shareholders, will result in an effective consolidation of the Tandem Ordinary
Shares on a ten for one basis prior to the Scheme becoming effective.
Therefore, if the Tandem Share Capital Reorganisation does proceed then MV
Sports Scheme Shareholders will instead receive 2 New Tandem Shares for every
430 MV Sports Shares held on the Record Date.



Application will be made to the London Stock Exchange for admission of the
Tandem Consideration Shares to be admitted to trading on AIM, which is expected
to take effect on the Effective Date and at the same time MV Sports Shares will
cease to be traded on AIM.



If the Scheme becomes effective, certificates in respect of the Tandem
Consideration Shares will be despatched to MV Sports Scheme Shareholders and for
CREST participants, CREST accounts will be credited with Tandem Consideration
Shares on the Effective Date.



Concurrently with the Scheme, MV Sports is also proposing to effect a capital
reduction.  The purpose of such reduction is to enable MV Sports to declare
dividends which will ultimately benefit the shareholders of Tandem as enlarged
by the acquisition of MV Sports.





3.         Information on MV Sports and background to and reasons for
the recommended Proposal



a)         Background



MV Sports is the holding company of a group that distributes sports and leisure
products and toys.



MV Sports is one of the UK market leaders in character wheeled and outdoor
products for children.  Based in Birmingham, the company employs a staff of 60
and has a total warehouse capacity of approximately 97,000 square feet spread
across two sites.



The MV Sports group commenced trading in 1986 when MV Sports chief source of
revenue was from the distribution of skates, skateboards and scooters to the
retail trade. During the 1990's, MV Sports grew and diversified its product
range to incorporate children's helmets, safety accessories and, subsequently,
trikes and bikes.



In 1998, MV Sports became a public limited company quoted on AIM.  The
acquisition of the Derby based company, Chelful Limited, allowed MV Sports to
trade as a broader-based wheeled and outdoor toy company with the addition of
new product categories such as toddler sit & rides, doll's prams & pushchairs,
garden toys and children's arts and crafts products.



MV Sports net turnover has increased considerably from £9.7 million for the year
ended 30 June 1996 to £22.7 million for the year ended 30 June 2002.  Such sales
growth can be largely attributed to MV Sports having secured high-profile
children's brand and character licences around which the majority of the product
range is centred. Featured amongst MV Sports current portfolio of licensed
products are, Barbie, Bratz, Disney, Groovy Chick, Yu-Gi-Oh, Winnie The Pooh,
Thomas and Friends, Bob The Builder and Lord of the Rings.



MV Sports also distributes non-licensed merchandise including skates,
skateboards, in-line micro scooters and the revolutionary Snakeboard concept for
which MV Sports holds patents in many countries around the world.



MV Sports has a predominantly 'blue-chip' retail customer base including Argos,
Index, Toys R Us, Halfords, Littlewoods, GUS and Woolworths, as major customers.
The majority of the product range is designed and developed in the UK and
manufactured by preferred Far East suppliers with which MV Sports has
established trading relationships.



b)         Reasons for the Recommended Offer



In response to sector saturation and greater market fragmentation, MV Sports has
been in the process of rationalisation and diversification, as well as seeking
out and pursuing possible acquisitions.  In the MV Sports 2002 annual report,
the MV Sports Directors outlined four objectives to improve the business as
follows:



•          to reduce reliance on the wheeled toy sector and key catalogue
           retailers;



•          to diversify the business into the wider children's and leisure
           markets;



•          to seek out acquisitions for additional sales opportunities,
           address seasonal imbalances and give operational synergies; and



•          to increase gross margins through better sourcing and
           operational efficiencies.



The MV Sports Directors believe that the Proposal should help to achieve these
objectives, and that consolidation in the sector appears inevitable given
current market conditions.  The opportunity to increase market share and margin
contribution by joining Tandem is therefore particularly attractive to MV
Sports, whilst at the same time achieving immediate diversification into new
business areas.  The MV Sports Directors also believe that being part of a
larger group will increase sourcing and marketing resources to capitalise on MV
Sports character licences.



In addition to the above, the MV Sports Directors believe that MV Sports
Shareholders will welcome the offer of an opportunity to exchange their MV
Sports Shares at a premium to the current mid-market price in exchange for
shares in a larger public company with a higher market capitalisation.  The MV
Sports Directors believe that a small market capitalisation, coupled with little
market liquidity and a highly fragmented shareholder base, has contributed to MV
Sports falling share price, with MV Sports not realising any material benefit
from its publicly listed status.  The MV Sports Directors also believe that the
costs of maintaining a listing on AIM will be proportionately smaller for the
Enlarged Group.



c)         MV Sports current trading



In the MV Sports 2002 annual report, the MV Sports Directors highlighted the
fact that the wheeled toy sector of the UK toy trade has experienced difficult
trading conditions and a significant downturn in sales.  The MV Sports Directors
believe that sector sales of character wheeled toys during the first half of
2002 declined by up to 30 per cent.  Despite the encouraging developments of the
previous financial year, MV Sports suffered a downturn in trade in line with the
rest of the sector which contributed to its results for the financial year ended
30 June 2002 being below market expectations.



MV Sports reported an operating loss of £438,000 (2001 operating profit:
£357,000) on turnover of £22.7 million (2001: £27.7 million).  The operating
loss, however, includes exceptional costs of £241,000 relating to the launch of
Kickmaster, an aborted takeover and the legal costs relating to the interruption
of power supply during October 2000.  As at 30 June 2002, MV Sports had net
assets of £5,116,000 (2001: £3,353,000) of which net assets excluding goodwill
were £2,846,000 (2001: £3,353,000).



Whilst the acquisition of Water Waiter Limited continues to perform in line with
expectations and the acquisition of the business and assets of In Pink Limited
will contribute to sales from January 2003 when shipments of new products to
customers commenced, sales since 30 June 2002 continue to be disappointing in MV
Sports wheeled toy business, with like for like sales in this period down 20 per
cent. on the previous year.  Although the benefit of additional cost saving
measures implemented by management in October 2002 will offset some of this
downturn in MV Sports wheeled toy business in the second half of this financial
year, the interim results to 31 December 2002 will be below those reported for
the corresponding period.  In addition, the negative cash flow experienced in
the 2002 financial year, combined with the continued downturn in trading, places
restrictions on MV Sports ability to implement its strategy of diversification.





4.         Information on Tandem



a)         Background



Tandem is a manufacturer and distributor of sports and leisure equipment which
has been pursuing a strategy of building the range of products offered to its
established and growing customer base both organically and through acquisition.
The Tandem Group now consists of three principal operating activities:


Bicycles and bicycle       The Tandem Group is one of the largest manufacturers of bicycles in the UK.  The well
accessories                established brands of Falcon, Claud Butler, Townsend, British Eagle and Dawes are
                           amongst the market leaders.  A wide range of branded bicycle accessories is
                           distributed throughout the UK.  The Dawes brand was acquired by Tandem in June 2001.


Indoor and outdoor play    Tandem's Pot Black business manufactures and distributes home snooker and pool
equipment                  products and has a substantial market share in its sector with sales predominantly in
                           the autumn and winter.  Since the acquisition in 2000, a range of outdoor play
                           products, under the 'Activity Plus' brand, has been developed in house to supply
                           spring and summer demand.  Further indoor leisure products including table football
                           and table tennis have also been added to the range.


Golf equipment and         The Tandem Group widened its presence in sporting goods with the acquisition of the
accessories                Ben Sayers golf business in February 2002.  Ben Sayers manufactures and distributes
                           golf clubs, bags and other accessories and is one of the oldest independent golf
                           equipment manufacturers in the world with over 120 years of trading.  New products
                           have been added to the range since the acquisition and more recently, in November
                           2002, Tandem announced that it had been appointed exclusive distributors, for the UK
                           and certain European countries, of the Joey Rodolfo and Resort 2 golf clothing brands
                           with the aim of further strengthening and widening the customer base of the golf
                           business.



b)         Reasons for the Recommended Offer



The Tandem Directors believe that the MV Sports business forms a good fit with
that of Tandem.  The product range is complementary and there are a significant
number of products which are or could be sold into the same customer base.  In
some cases products distributed by Tandem are sourced from the same producers as
those distributed by MV Sports, or a single source for both can be found.



The anticipated benefits to the Enlarged Group resulting from the acquisition of
MV Sports by Tandem therefore include the improved margins, as a result of
better supplier terms and the ability to sell a fuller product range to a wider
customer base than has hitherto been the case.  Savings in central overheads
(not least of which is the cost of two companies both maintaining a public
quotation) are also anticipated as is the ability for the Enlarged Group to
negotiate improved terms from providers of banking finance and other credit.



Finally, Tandem is keenly aware that investor interest in smaller companies is
not always strong but that interest tends to improve as companies become larger.
The increase in Tandem's market capitalisation as a result of the acquisition
of MV Sports, while in no way guaranteeing instant wider institutional investor
interest will, in the opinion of the Tandem Directors, improve the likelihood
that such interest will be generated.



c)         Tandem current trading and future prospects



In the Chairman's interim statement released on 17 October 2002, it was reported
that it was anticipated that the full year performance of the bicycle business
should have shown an increase over the previous year and that the indoor and
outdoor play equipment business should deliver a significant increase in
profits.  It was also stated that new products were being introduced to the golf
equipment and accessories business, which together with improvements in the
management of the business should increase turnover and operating profits in
future years.  The statement concluded that despite difficult trading
conditions, the board of Tandem was able to report a period of solid progress
and prospects for a much, improved current year.



Trading in two of Tandem's three operating businesses in recent weeks has not
met its board's expectations.



In the bicycle and bicycle accessories business, the increased competition in
the lower specification bicycle market has continued.  Whilst sales are expected
to be broadly in line with those reported last year, despite enjoying the
benefit of a full years trading from Dawes which was acquired in June 2001,
margins have been under pressure and, as a result, profits will be lower.
Considerable efforts have been made to improve the profitability of the business
and the product range has been changed to allow sales of these lower price
products at acceptable margins. Furthermore, the development of this product
range is anticipated to lead to significant savings of fixed costs.  The Tandem
board expects that Tandem will increase market share in the lower specification
bicycle market during 2003 and view 2003 with confidence.  Tandem's new product
range has been well received by key customers and increased listings have been
achieved not only in lower value products, but also in higher value models.



In the golf equipment and accessories business, sales are below expectations and
significant expenditure has been invested in repositioning the Ben Sayers brand
since its acquisition in 2002.  As a result, the level of orders received for
2003 for Ben Sayers' golf equipment and Joey Rodolfo golf clothing is
encouraging.



The indoor and outdoor play equipment business has traded in line with the
Tandem Directors' expectations, being an increase on the comparable period in
2001. An improvement in profit for this business is anticipated.  Further
opportunities to develop the cue sport business of Pot Black have been
identified and resources have been directed in that area.  It is expected that
this will increase turnover with favourable margins.



Finally, certain costs unrelated to the trading of the Tandem Group, which were
not anticipated, will be reflected in the 31 January 2003 figures including
£89,000 to meet pension commitments.



In the light of the above, Tandem Directors currently anticipate that Tandem's
profit before goodwill and taxation will not exceed £440,000 for the year ending
31 January 2003.  This compares with an audited profit before goodwill and
taxation of £715,000, reported for year ended 31 January 2002.



Tandem is currently defending a claim by a former customer in relation to
compost supplied between 1994 and 1995 by a Tandem subsidiary during its
ownership of a horticultural business. Although Tandem was unsuccessful on
liability at trial, the matter continues to be vigorously defended and the
appeal process is ongoing.  The Tandem Directors have been advised that there is
a reasonable prospect of success. If the appeal succeeds, the case will be
concluded, otherwise quantum is still to be determined. Currently there is
evidence to suggest that quantum could be between £80,000 and £215,000 (plus
interest and costs but less any allowance for mitigation), but this is by no
means fixed since arguments on quantum have yet to be presented and determined.
Tandem has a long-standing provision, of which £72,000 remains, in respect of
this litigation which will be released should its appeal be successful.  The
profit before goodwill and taxation figure set out above does not include any
upward or downward adjustment for this litigation.



Tandem continues to look to build its business through carefully focused
acquisitions, as well as devoting management time to adding products to its
existing businesses to allow them to grow organically.



d)         New Tandem banking facilities



New bank facility agreements with HSBC Bank plc were signed by Tandem on 30
January 2003.  As part of the agreements, HSBC will provide a £2.5 million three
year loan together with overdraft facilities of up to £3 million.  This replaces
the previous facility which was repayable on demand.



e)         Conclusion



Tandem's overriding priority has been and continues to be to maintain the
improvement in shareholder value by increasing profitability and reducing debt
and its board is working to ensure that the financial year ending 31 January
2004 will mark a step forward in this objective.





5.         Inducement fee



In consideration of Tandem agreeing to make an announcement of a firm intention
to make an offer for MV Sports, MV Sports has agreed, subject to certain
conditions, to pay Tandem £100,000 if in the six months following the date of
this announcement either the MV Sports board recommend, inter alia, an
alternative offer or if an offer by a party other than Tandem is declared
unconditional in all respects for MV Sports.





6.         Recommendation



The MV Sports Directors, who have been so advised by Seymour Pierce, consider
the terms of the Offer to be fair and reasonable and in the best interests of MV
Sports Shareholders as a whole. In providing advice to the MV Sports Directors,
Seymour Pierce has taken into account the MV Sports Directors' commercial
assessment.



Accordingly, the MV Sports Directors unanimously recommend the MV Sports
Shareholders vote in favour of the Scheme at the Court Meeting and to vote in
favour of the resolutions to be proposed at the Extraordinary General Meeting,
as they intend to do in respect of their own beneficial holdings amounting to
70,214,101 MV Sports Shares (representing approximately 2.7 per cent. of the
existing issued share capital of MV Sports).





7.         Employees



Tandem has confirmed to the MV Sports Directors that, following the Scheme
becoming effective, the existing employment rights, including pension rights, of
all the employees of MV Sports will be fully safeguarded.  All of the MV Sports
Directors will remain with the Enlarged Group as directors of MV Sports which
will become a subsidiary of Tandem.





8.         Meetings



The Scheme will require approval at the Court Meeting and the passing of certain
resolutions at the MV Sports EGM and the Tandem EGM to be held on the same day
and the subsequent sanction of the Court.



If the Scheme becomes effective, it will be binding on all MV Sports
Shareholders, including any holders who did not vote to approve the Scheme at
the Court Meeting or MV Sports EGM.



9.         General



The formal documentation relating to the Proposal containing, inter alia, a
letter from the Chairman of Tandem and the Managing Director of MV Sports
setting out the rationale behind the Proposal (including a letter from the
Managing Director of MV Sports setting out the recommendation of the MV Sports
Directors and an explanatory statement regarding the Scheme from Seymour Pierce,
advisers to MV Sports), will be posted to MV Sports Shareholders in due course.



As at the date of this announcement, Tandem holds no MV Sports Shares and no MV
Sports Shares are owned or controlled by any person acting in concert with it.
Similarly, neither Tandem nor any person acting in concert with it holds an
option to acquire or subscribe for any MV Sports Shares.



MV Sports Shareholders (including MV Sports Directors) holding 150,674,867 MV
Sports Shares (amounting to 5.8 per cent. of the existing issued share capital
of MV Sports) have irrevocably undertaken to vote in favour of the Proposal at
the MV Sports EGM and Court Meeting.



The conditions to the Offer are set out in Appendix I and definitions of certain
expressions used in this announcement are set out in Appendix II.





10.        Sources and bases of information



Unless otherwise stated, (i) financial information relating to MV Sports has
been derived from the published audited financial statements of MV Sports for
the relevant period; and (ii) financial information relating to Tandem has been
derived from the published audited financial statements of Tandem for the
relevant period.  A report, prepared by Deloitte & Touche in accordance with the
requirements of the Code, in respect of the profit forecast of Tandem, made
within this announcement, will be included in the Scheme document.



The value of the MV Sports Shares under the Proposal is based upon the number of
MV Sports Shares in issue as at the date of this announcement, being
2,616,207,254.



Contacts:



For Tandem

Mervyn Keene, Finance Director, Tandem                     01733 211399
Adam Hart, KBC Peel Hunt                                   020 7418 8900
David Haggie/Peter Rigby, Haggie Financial                 020 7417 8989


For MV Sports

Stephen Grant, Managing Director, MV Sports                0121 748 8000
Mark Percy, Seymour Pierce                                 020 7648 8700
Nick Dibden, Weber Shandwick Fleet Financial               020 7067 0700



                                     PART 2



                                   APPENDIX I

 CONDITIONS TO THE IMPLEMENTATION OF THE SCHEME AND THE OFFER AND CERTAIN OTHER
                                     TERMS



1.     The Offer is conditional upon the Scheme becoming unconditional and 
effective, by not later than 31 May 2003 or such later date as
Tandem and MV Sports may agree and (if required) the Court may approve.  The
Scheme is conditional upon:

(a)            the approval of the Scheme at the Court Meeting by a majority in
number representing not less than three-fourths in value of the holders of MV
Sports Scheme Shares present and voting either in person or by proxy;



(b)            the passing at the MV Sports Extraordinary General Meeting
of the Special Resolution;



(c)            the passing at the Tandem Extraordinary General Meeting of
such resolutions as may be necessary to approve, implement and effect the Offer
and the acquisition of any MV Sports Shares under the Offer;



(d)            the sanction (with or without modification) of the Scheme by
the Court and confirmation of any reduction of capital involved therein by the
Court, an office copy of the Order of the Court being delivered for registration
to the Registrar of Companies in England and Wales and registration of the Order
confirming any reduction of capital involved in the Scheme with the Registrar of
Companies in England and Wales.



2.             The Offer is also conditional upon the following matters
and accordingly the necessary action to make the Scheme effective will not be
taken unless the following are satisfied or waived by Tandem at or prior to the
Court Hearing:

(a)            it being established, that neither the proposed acquisition of MV
Sports by Tandem nor any matters arising from it, either fall within the
statutory provisions for possible reference to the Competition Commission or
have been referred in whole or in part to the Competition Commission;



(b)            it being established, that it is not the intention of the
European Commission or within its jurisdiction, pursuant to the Regulation,
either to initiate proceedings under Article 6(1)(c) of the Regulation or to
make a referral to a competent authority of any Member State of the European
Union under Article 9(1) of the Regulation in respect of the Offer and the
proposed acquisition by Tandem of MV Sports or any matters arising out of it;



(c)            all Authorisations necessary or appropriate for, or in
respect of, the Offer, its implementation or any acquisition of any shares in,
or control of, MV Sports or any member of the wider MV Sports Group (to the
extent that MV Sports owns any such shares in or has any such control of any
such other member of the wider MV Sports Group) by Tandem having been obtained
from any relevant person or person or body with whom any member of the wider MV
Sports Group has entered into contractual arrangements and all such
Authorisations not having expired, lapsed or been terminated;



(d)            all Authorisations necessary to carry on the business of any
member of the wider MV Sports Group remaining in full force and effect and there
being no intimation of any intention to revoke or not to renew the same;



(e)            all necessary filings having been made and all necessary
waiting and other periods having expired, lapsed or been terminated and all
necessary statutory or regulatory obligations in any jurisdiction having been
complied with;



(f)            no Relevant Authority having taken, instituted, implemented
or threatened any action, suit, proceeding, investigation or enquiry or having
required any action to be taken or otherwise having done anything or having
enacted, made or proposed any statute, regulation, order or decision or taken
any other step (and there not continuing to be outstanding any statute,
regulation, order or decision) that would or might:



(i)            make the Offer, its implementation or the acquisition or
proposed acquisition of any shares in, or control or management of, the wider MV
Sports Group by Tandem illegal, void or unenforceable; or

(ii)           otherwise directly or indirectly restrict, restrain,
prohibit, delay or interfere in the implementation of or impose additional
conditions or obligations with respect to or otherwise challenge or require
amendment of the Offer or the proposed acquisition of MV Sports by Tandem or any
acquisition of shares in MV Sports by Tandem; or

(iii)          result directly or indirectly in a delay in the ability of
Tandem, or render Tandem unable, to acquire some or all of the shares in MV
Sports; or

(iv)           impose any limitation on the ability of Tandem or any member
of the wider Tandem Group or MV Sports or any member of the wider MV Sports
Group to acquire or hold or exercise effectively, directly or indirectly, any
rights of ownership of shares or other securities or the equivalent in any
member of the wider MV Sports Group or management control over any member of the
wider MV Sports Group; or

(v)            require the disposal by MV Sports or any member of the wider
Tandem Group of all or any part of their respective businesses, assets or
properties or impose any limitation on the ability of any of them to conduct
their respective businesses or own their respective assets or properties; or

(vi)           require any member of the wider Tandem Group or of the wider
MV Sports Group to offer to acquire any shares or other securities (or the
equivalent) in any member of the wider MV Sports Group or any member of the
wider Tandem Group owned by any third party; or

(vii)          impose any limitation on the ability of any member of the
wider Tandem Group or the wider MV Sports Group to integrate or co-ordinate its
business, or any part of it, with the businesses or any part of the businesses
of any other member of the wider Tandem Group and/or the wider MV Sports Group;
or

(viii)         result in any member of the wider Tandem Group or the wider MV
Sports Group ceasing to be able to carry on business under any name under which
it presently does so; or

(ix)           otherwise materially and adversely affect any or all of the
businesses, assets, prospects or profits of any member of the wider Tandem Group
or the wider MV Sports Group;

(g)            no employee having left the MV Sports Group whose departure
materially affects the business assets, profits or prospects of any member of
the MV Sports Group and/or Tandem;



(h)            save as Disclosed, there being no provision of any
agreements to which any member of the wider MV Sports Group is a party, or by or
to which any such member, or any part of its assets, may be bound, entitled or
subject, which would or might, in each case as a consequence of the Offer or of
the acquisition or proposed acquisition of all or any part of the issued share
capital of, or change of control or management of, MV Sports or any other member
of MV Sports Group or otherwise result in:



(i)            any assets or interests of any member of the wider MV
Sports Group being or failing to be disposed of or charged in any way or any
rights arising under which any such asset or interest could be required to be
disposed of or charged in any way; or

(ii)           any moneys borrowed by or other indebtedness actual or
contingent of, or any grant available to, any member of the wider MV Sports
Group being or becoming repayable or capable of being declared repayable
immediately or earlier than the repayment date stated in such agreement or the
ability of such member of the wider MV Sports Group to incur any such borrowing
or indebtedness becoming or being capable of becoming withdrawn, inhibited or
prohibited; or

(iii)          any such agreement or the rights, liabilities, obligations
or interests of any such member under it being terminated or adversely modified
or affected or any onerous obligation arising or any adverse action being taken
under it which is material to Tandem in the context of the Offer; or

(iv)           the interests or business of any such member in or with any
third party (or any arrangements relating to any such interests or business)
being terminated or adversely modified or affected; or

(v)            the financial or trading position or prospects of any member
of the wider MV Sports Group or their value being prejudiced or adversely
affected to an extent which is material to Tandem in the context of the Offer;
or

(vi)           the creation or enforcement of any mortgage, charge or other
security interest over the whole or any part of the business, property or assets
of any member of the wider MV Sports Group or any such security (whenever
arising or having arisen) becoming enforceable; or

(vii)          any member of the wider MV Sports Group ceasing to be able to
carry on business under any name under which or on the terms on which it
currently does so or any person presently not able to carry on business under
any name under which any member of the wider MV Sports Group currently does
becoming able to do so; or

(viii)         the creation of actual or contingent liabilities by any member
of the wider MV Sports Group which is material to Tandem in the context of the
Offer; or

(ix)           the ability of any member of the Tandem Group to carry on its
business being adversely affected;

(x)            and no event having occurred which under any provision of
any such agreement to which any member of the wider MV Sports Group is a party,
or by or to which any such member, or any of its assets, may be bound, entitled
or subject, could result, in any of the events or circumstances as are referred
to in paragraphs (h) (i)  to (h) (ix) inclusive;

(i)            save as Disclosed, no member of the wider MV Sports Group
having:



(i)            issued or agreed to issue or authorised or proposed the issue or
grant of additional shares of any class or securities convertible into or
exchangeable for, or rights, warrants or options to subscribe for or acquire,
any such shares or convertible securities; or

(ii)           redeemed, purchased, repaid or reduced or proposed the
redemption, purchase, repayment or reduction of any part of its share capital or
made or proposed the making of any other change to its share capital (save than
pursuant to this Scheme); or

(iii)          recommended, declared, paid or made or proposed to recommend,
declare, pay or make any dividend, bonus or other distribution whether payable
in cash or otherwise; or

(iv)           merged or demerged with or from, or acquired, any body corporate
or authorised or proposed or announced any intention to propose any such merger
or demerger; or

(v)            acquired or disposed of, transferred, mortgaged or charged, or
created or granted any security interest over, any assets (including shares and
trade investments other than in the ordinary course of business) or authorised
or proposed or announced any intention to propose any acquisition, disposal,
transfer, mortgage, charge or creation or grant of any security interest; or

(vi)           issued or authorised or proposed the issue of any
debentures or incurred or increased any borrowings, indebtedness or liability
(actual or contingent); or

(vii)          entered into or varied, or authorised or proposed the entry into
or variation of, or announced its intention to enter into or vary, any
transaction, arrangement, contract or commitment (whether in respect of capital
expenditure or otherwise) which is of a long term, onerous or unusual nature or
magnitude or which is or could be restrictive to the existing business of any
member of the wider MV Sports Group or which is other than in the ordinary
course of business; or

(viii)         entered into, implemented, effected, authorised or proposed or
announced its intention to enter into, implement, effect, authorise or propose
any contract, reconstruction, amalgamation, scheme, commitment or other
transaction or arrangement otherwise than in the ordinary course of business; or

(ix)           waived or compromised any material claim; or

(x)            entered into or varied or made any offer (which remains open for
acceptance) to enter into or vary the terms of any contract with any of the
directors or senior executives of any member of the wider MV Sports Group; or

(xi)           taken or proposed any corporate action or had any legal
proceedings instituted or threatened against it or petition presented for its
winding-up (voluntarily or otherwise), dissolution or reorganisation or for the
appointment of a receiver, administrator, administrative receiver, trustee or
similar officer of all or any of its assets and revenues or for any analogous
proceedings or steps in any jurisdiction or for the appointment of any analogous
person in any jurisdiction; or

(xii)          been unable or admitted in writing that it is unable to pay
its debts or having stopped or suspended (or threatened to stop or suspend)
payment of its debts generally or ceased or threatened to cease carrying on all
or a substantial part of its business; or

(xiii)         made any alteration to its memorandum or articles of
association, or other incorporation documents (save than pursuant to the
Scheme); or

(xiv)          in relation to the pension schemes established for its
directors and/or other employees and/or their dependants, made or consented to
any change to the terms of the trust deeds constituting such pension schemes or
to the benefits which accrue, the pensions which are payable under them, the
basis on which qualifications for or accrual of or entitlement to such benefits
or pensions are calculated or determined, the basis upon which the liabilities
(including pensions) of such pension schemes are funded or made or has or agreed
or consented to any change to the trustees of such pension schemes;

(j)            save as Disclosed:



(i)            no material litigation or arbitration proceedings, prosecution,
investigation or other legal proceedings having been announced, instituted,
threatened or remaining outstanding by, against or in respect of, any member of
the wider MV Sports Group or to which any member of the wider MV Sports Group is
or may become a party (whether as claimant, defendant or otherwise); or

(ii)           no material adverse change or deterioration having occurred in
the business or assets or financial or trading position or prospects, assets or
profits of any member of the wider MV Sports Group; or

(iii)          no enquiry or investigation by, or complaint or reference to, any
relevant person against or in respect of any member of the wider MV Sports Group
having been threatened, announced, implemented or instituted or remaining
outstanding by, against or in respect of, any member of the wider MV Sports
Group and which is material; or

(iv)           no contingent or other liability having arisen or become apparent
or increased which would or might be expected to affect materially and adversely
the wider MV Sports Group taken as a whole;

(k)            save as Disclosed, Tandem not having discovered that:



(i)            any past or present member of the wider MV Sports Group has
failed to comply in a material respect with all applicable legislation or
regulations or authorisations of any jurisdiction with regard to the use,
handling, storage, transport, production, supply, treatment, keeping, disposal,
discharge, spillage, leak or emission of any waste or hazardous substance or any
substance likely to damage or impair the environment or harm human health or
otherwise relating to environmental matters or the health and safety of any
person or that there has otherwise been any such use, handling, storage,
transport, production, supply, treatment, keeping, disposal, discharge,
spillage, leak or emission (whether or not the same constituted a non-compliance
by any person with any such legislation or regulations or authorisations and
wherever the same may have taken place), which, in any such case, would be
likely to give rise to any material liability (whether actual or contingent) or
cost on the part of any member of the wider MV Sports Group; or

(ii)           there has been a disposal, discharge, release, spillage, leak or
emission of any waste or hazardous substance or any substance likely to damage
or impair the environment or harm human health which would be likely to give
rise to any material liability (whether actual or contingent) or cost on the
part of any member of the wider MV Sports Group; or

(iii)          there is, or is likely to be any material liability (whether
actual or contingent) or cost on the part of any member of the wider MV Sports
Group to make good, repair, reinstate or clean up any relevant asset or any
other property or any controlled waters under any environmental legislation,
regulation, notice, circular, order or other lawful requirement of any relevant
person or third party or otherwise; or

(iv)           that circumstances exist (whether as a result of the making of
the Offer or otherwise) which would be likely to lead to any relevant person
instituting or whereby any past or present member of the wider MV Sports Group
would be likely to be required to institute an environmental audit or take any
steps which would in any such case be likely to result in any material actual or
contingent liability to improve or modify existing plant or install new plant,
machinery or equipment or carry out any changes in the processes carried out or
make good, repair, reinstate or clean up any relevant asset or any other
property or any controlled waters;

(l)            no circumstances existing whereby a person or class of
persons would be likely to have any material claim or claims in respect of any
product or process of manufacture or materials used therein now or previously
manufactured, sold or carried out by any past or present member of the wider MV
Sports Group;



(m)            it being established that:



(i)           the financial, business or other information disclosed at any time
by any member of the wider MV Sports Group, whether publicly or in the context
of the Offer did not contain a misrepresentation of fact nor omitted to state a
fact necessary to make the information disclosed not misleading; or

(ii)          no contingent liability disclosed in such disclosed information
would or might materially and adversely affect, directly or indirectly, the
business, profits or prospects of the wider MV Sports Group taken as a whole; or

(iii)         no information disclosed at any time by or on behalf of any member
of the wider MV Sports Group to Tandem (or its advisors) is or will become
incorrect in any material respect;

(n)            it being established that:



(i)            no member of the wider MV Sports Group is subject to any
material liability, contingent or otherwise, which is not disclosed in MV Sports
accounts for the period ending 30 June 2002;

(ii)           no member of the wider MV Sports Group which is not a subsidiary
undertaking of MV Sports and any partnership, company or other entity in which
any member of the MV Sports Group has a significant interest is subject to any
material liability, contingent or otherwise, which is not disclosed in the
audited accounts of MV Sports for the year ended on 30 June 2002;

(o)            it being established that save as Disclosed:



(i)            each member of the wider MV Sports Group owns or has licensed to
it or otherwise possesses legally enforceable rights to use all intellectual
property that is required or reasonably necessary for the conduct of business of
the relevant member of the wider MV Sports Group as currently conducted for the
development for such business;

(ii)           no member of the wider MV Sports  Group has infringed, any
intellectual property rights of any third party;

(iii)          no claims have been asserted in writing or threatened in writing
by any person that the wider MV Sports Group infringes any intellectual property
of any third party or challenging the ownership of any member of the wider MV
Sports Group to, or the validity or effectiveness of, any of its intellectual
property;

(iv)           all intellectual property held by any member of the wider MV
Sports Group is valid and subsisting;

(v)            there is no material unauthorised use, infringement or
misappropriation of any intellectual property of any member of the wider MV
Sports Group by any third party; and

(p)            no persons who are now, or within the last five years have
been, employees, consultants or contractors of any member of the wider MV Sports
Group have failed to execute proprietary information and confidentiality
agreements.



3.             The Offer will lapse unless all of the conditions relating
to the Offer have been fulfilled or satisfied or (if capable of waiver) waived
by or, where appropriate, at midnight on 31 May 2003 or such later date as
Tandem may, with the consent of the Panel, decide.  Tandem shall be under no
obligation to waive or treat as satisfied any condition by a date earlier than
the latest date specified above for its satisfaction even though the other
conditions of the Offer may, at such earlier date, have been waived or fulfilled
and that there are, at such earlier date, no circumstances indicating that any
such conditions may not be capable of fulfilment.

4.             The conditions are inserted for the benefit of Tandem and
no MV Sports Shareholder shall be entitled to waive any of the conditions
without the prior consent of Tandem.

5.             Tandem reserves the right to waive all or any of
conditions 2(a) to 2(p) inclusive, in whole or in part.

6.             The Offer is governed by English law.  The Rules of the
Code, so far as they are appropriate, apply to the Offer.

7.             The Offer will lapse and the Scheme will not proceed if,
before the date of the Court Hearing, the Offer is referred to the Competition
Commission.


                                  APPENDIX II



(a)   The following definitions apply throughout this announcement, unless the context otherwise requires:-

'Act' or 'Companies Act'             the Companies Act 1985, as amended;

'agreements'                         means in connection with the Conditions, arrangements, agreements,
                                     licences, permits, franchises, partnerships, joint ventures,
                                     authorisations or other instrument;

'AIM'                                the Alternative Investment Market of London Stock Exchange plc;

'Australia'                          the Commonwealth of Australia and its dependencies;

'Authorisations'                     all authorisations, orders, recognitions, grants, consents, licences,
                                     confirmations, clearances, certificates, permissions, approvals, waivers
                                     and determinations in any jurisdiction;

'business day'                       a day (excluding Saturdays, Sundays and public holidays) on which banks
                                     are open for business in the City of London;

'Canada'                             Canada, its provinces, territories and possessions and areas subject to
                                     its jurisdiction or under its control or any sub-division thereof;

'Code' or 'City Code'                the City Code on Takeovers and Mergers;

'Conditions'                         the conditions to the Scheme set out in Appendix 1 of this announcement
                                     and 'Condition' means any one of them;
'Court'                              the High Court of Justice in England and Wales;

'Court Hearing'                      the hearing by the Court of the petition to sanction the Scheme and
                                     confirm the cancellation of share capital in connection therewith (and any
                                     adjournment thereof);

'Court Meeting'                      the meeting of MV Sports Scheme Shareholders convened at the direction of
                                     the High Court at which a resolution will be proposed to approve the
                                     Scheme, including any adjournment thereof;

'CREST'                              the system for the paperless settlement of trade in securities and the
                                     holding of uncertificated securities operated by CrestCo in accordance
                                     with the Uncertificated Securities Regulations 2001;

'Disclosed'                          means disclosed in the Disclosure Letter;

'Disclosure Letter'                  means a letter written by MV Sports to Tandem and received and
                                     acknowledged in writing by Tandem specifically for the purpose of the
                                     Conditions on the date of this announcement;

'Effective Date'                     the date on which the Scheme becomes effective in accordance with its
                                     terms;

'Enlarged Group'                     the Tandem Group (including the MV Sports Group) which will be created if
                                     the Scheme becomes effective;

'Hearing Date'                       the date of the Court Hearing;

'intellectual property'              means in connection with the Conditions, all patents, trademarks, trade
                                     names, service marks, copyrights, designs, databases and any applications
                                     therefor, schematics, technology, know-how, computer software, programs or
                                     applications (in both source code and object code form), and tangible or
                                     intangible proprietary information or material;

'KBC Peel Hunt'                      KBC Peel Hunt Ltd;

'MV Sports'                          MV Sports Group Plc;

'MV Sports Group'                    MV Sports Group Plc and its subsidiaries;

'MV Sports Directors'                the directors of MV Sports as at the date of this announcement;

'MV Sports Extraordinary General     the extraordinary general meeting of MV Sports to be convened in
Meeting' or 'MV Sports EGM'          connection with the approval of the Scheme, including any adjournment
                                     thereof;

'MV Sports Scheme Shareholders'      holders of MV Sports Scheme Shares;

'MV Sports Scheme Shares'            the MV Sports Shares:

                                     (a)           in issue at the date of this announcement other than one MV
                                     Sports Share which will be acquired and registered in the name of Tandem
                                     prior to the Hearing Date;

                                     (b)           (b)            issued after the date of this document and
                                     prior to the Voting Record Time;           and

                                     (c)           issued thereafter and prior to the Record Date either on
                                     terms that the original or any subsequent holders thereof shall be bound
                                     by the Scheme or in respect of which the holders thereof shall have agreed
                                     to be bound by the Scheme;

'MV Sports Shareholders'             the holders of MV Sports Shares;

'MV Sports Shares'                   the ordinary shares of 0.1p each in the capital of MV Sports;

'New Tandem Shares'                  the ordinary shares of 4 pence each in the share capital of Tandem which
                                     will be created if the Tandem Share Capital Reorganisation is approved by
                                     the Tandem Shareholders at the Tandem EGM;

'Offer'                              the recommended offer by Tandem for MV Sports to be implemented by way of
                                     the Scheme;

'Order'                              the order of the Court sanctioning the Scheme and confirming the
                                     cancellation of share capital which forms part of it;

'Panel'                              The Panel on Takeovers and Mergers;

'Proposal'                           the proposed acquisition by Tandem of the Scheme Shares by means of the
                                     Scheme as described in this announcement;

'Record Date'                        midnight on the business day immediately preceding the Hearing Date;

'Regulation'                         article 9(1) of Council Regulation (EEC) 4064/89 as amended by Council
                                     Regulation (EEC) 1310/47;

'relevant asset'                     means in connection with the Conditions, land, property or other asset now
                                     or previously owned, occupied or made use of by any part or present member
                                     of the Wider MV Sports Group;

'Relevant Authority'                 means governments, governmental, quasi-governmental, supra-national,
                                     statutory, investigative, regulatory or administrative bodies or trade
                                     agencies, associations, institutions or courts, or professional or
                                     environmental bodies, or any other persons or bodies whatsoever in any
                                     jurisdiction;

'Scheme'                             the scheme of arrangement to be made under section 425 of the Act between
                                     the Company and the MV Sports Scheme Shareholders;

'Securities Act'                     the United States Securities Act of 1933 (as amended);

'Seymour Pierce'                     Seymour Pierce Limited;

'significant interest'               means in connection with the Conditions, a direct or indirect interest in
                                     20 per cent. or more of the equity capital of an undertaking;

'Special Resolution'                 the special resolution to be proposed at the MV Sports Extraordinary
                                     General Meeting;

'Sterling'                           the lawful currency of the United Kingdom;

'Subsidiary'                         means:


                                     (i)                       a subsidiary within the meaning of section 736
                                     of the Companies Act 1985; and



                                     (ii)                      unless the context otherwise requires, a
                                     subsidiary undertaking within the meaning of section 258 of the Companies
                                     Act;


'Tandem'                             Tandem Group plc;

'Tandem Consideration Shares'        New Tandem Shares (or, if the Tandem Share Capital Reorganisation does not
                                     proceed, Tandem Ordinary Shares) which will be issued under the Scheme;

'Tandem Directors'                   the directors of Tandem as at the date of this announcement;

'Tandem Extraordinary General        the extraordinary general meeting of Tandem to be convened in connection
Meeting' or 'Tandem EGM'             with the Scheme and the Tandem Share Capital Reorganisation;

'Tandem Group'                       Tandem and its subsidiaries;

'Tandem Ordinary Shares'             the ordinary shares of 4 pence each in the share capital of Tandem;

'Tandem Resolutions'                 such Tandem Shareholder resolutions as may be necessary to approve,
                                     implement and effect the Offer, the Scheme and the acquisition of MV
                                     Sports Shares under the Offer and Scheme;

'Tandem Share Capital                the proposed consolidation of the Tandem Ordinary Shares;
Reorganisation'

'Tandem Shareholders'                the holders of Tandem Ordinary Shares;

'third party'                        means person, firm, company or body;

'UK' or 'United Kingdom'             the United Kingdom of Great Britain and Northern Ireland;

'United States'                      the United States of America, its territories and possessions, any state
                                     of the United States and the District of Columbia and all other areas
                                     subject to its jurisdiction;

'US Person'                          has the meaning given in Regulation S under the Securities Act;

'Voting Record Time'                 6.00 pm on the day prior to the day immediately before the Court Meeting
                                     or any adjournment thereof (as the case may be);

'wider MV Sports Group'              means MV Sports and its subsidiary undertakings, associated undertakings
                                     and any other undertakings to which MV Sports and/or such undertakings
                                     (aggregating their interests) have a significant interest; and

'wider Tandem Group'                 means Tandem and its subsidiary, undertakings, associated undertakings and
                                     any other undertakings in which Tandem and/or such undertakings
                                     (aggregating their interests) have a significant interest.





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