Proposed Placing and Acquisition

YooMedia plc Proposed Capital Reorganisation Proposed consolidation into New Ordinary Shares Proposed increase in the authorised share capital Proposed acquisition of a majority holding in Fresh Interactive Technologies SA Proposed placing of 7.845m New Ordinary Shares at £1.0962 per New Ordinary Share Proposed capitalisation of Convertible Loan Notes and Directors' Fees Proposed change of name to Mirada Plc YooMedia Plc, ("YooMedia" or the "Company") (AIM: YOO), is pleased to announce that it has conditionally agreed to acquire 95.2% of the issued share capital of Fresh Interactive Technologies SA ("Fresh"), a leading Spanish interactive television company, and has conditionally raised the sum of approximately £12.9 million (before the deduction of any expenses), following a share consolidation and restructuring. The Company is also proposing to settle sums due to two of its lenders, Highbridge International LLC and Platinum Value Arbitrage Fund, LLP, and fees which are due to certain of the Directors (together, the "Proposals"). It should be noted that the Proposals are conditional on, inter alia, the passing by the holders of ordinary shares of 1p each in the Company (the "Shareholders") of certain resolutions to be proposed at an extraordinary general meeting of the Company ("EGM"). A circular and the notice to convene the EGM ("Notice") have not yet been sent to Shareholders and this circular is required to be approved by the Panel on Takeovers and Mergers ("the Takeover Panel") before being despatched. A further announcement regarding the publication of the circular containing the Notice will be made in due course. YooMedia also proposes to sell YooMedia Dating Group Limited, its subsidiary business which trades under the Dateline brand. As part of the Proposals, the Company is proposing to raise a total of approximately £12.9 million, £8.6 million of which will be through a placing of new ordinary shares of £1 each in the Company ("the Placing") at £1.0962 per share, mainly with Kasei 2000 SL ("Kasei 2000"), a special investment vehicle which, as announced by the Company in July 2007, had been granted an option to acquire the Company's games and gambling business. A further sum of approximately £4.3 million will be raised through an investment in Fresh by Baring Private Equity España ("Baring") which is to be completed prior to the acquisition of 95.2% of the issued share capital of Fresh by the Company (the "Acquisition"). These aggregate funds will be used to strengthen the Group's balance sheet, to provide working capital, to invest in new products and services as well as assist in financing the Group's proposed international expansion. It is also proposed to change the name of the Company following the completion of the transactions to Mirada plc. As following the Placing and the Acquisition, Kasei 2000's investment in the Company would be 43.06% of its enlarged share capital, Kasei 2000's investment will be conditional on, inter alia, Shareholders passing, on a poll at the EGM (which is yet to be convened), a waiver of the requirement under Rule 9 of the Takeover Code ("Rule 9 whitewash") for Kasei 2000 to make an offer for the entire issued share capital of YooMedia. The circular requisitioning the EGM will itself be subject to approval by the Takeover Panel prior to its despatch to Shareholders. However, the Board is in negotiations with an unrelated third party with regard to a potential participation in the Placing. If such negotiations are successfully concluded, Kasei 2000's participation in the Placing would be reduced by such amount so that it would hold, in aggregate, less than 30% of the enlarged share capital of YooMedia on completion of the Proposals. Under such circumstances a Rule 9 whitewash would not be required. The Company has found it difficult to achieve profitability in the UK market and as a result the Group's balance sheet has become weak. An update on current trading, including the proposed disposal of Dateline, is provided below. Michael Sinclair will remain Chairman of the Enlarged Group and Fresh's Chief Executive, José-Luis Vazquez, will become Chief Executive Officer. Neil MacDonald, currently Managing Director of YooMedia, will become Chief Operating Officer and Rafael Martín Sanz, a director of Kasei 2000, will join the Board as a Non-Executive Director. In addition, to better reflect the business of the enlarged Group going forward, the Directors are seeking to change the name of the Company to Mirada plc. CAPITAL REORGANISATION The transactions will involve a reorganisation of the Company's capital structure. It is proposed that each issued and unissued ordinary share of 1p be subdivided into one ordinary share of 0.1p and nine A deferred shares of 0.1p each. Every 1,000 subdivided shares will then be consolidated into one new ordinary share of £1 ("New Ordinary Share"). All share warrants and options which have been issued by the Company will be consolidated on the same basis. The rights attaching to the New Ordinary Shares will be identical in all respects to those of the current ordinary shares of 1p each. The new A deferred shares of 0.1p each will not be consolidated and will have very limited rights. Following the consolidation there will only be approximately 912,242 New Ordinary Shares in issue (although this number could vary due to fractional entitlements which may arise as a result of the capital reorganisation and the share consolidation). It is proposed that the authorised share capital of the Company be increased to £30,000,000. Terms of the Acquisition The Company has conditionally agreed to acquire 95.2% of the issued share capital of Fresh. Baring has undertaken to invest approximately £4.3 million, by way of a subscription for new shares in Fresh prior to completion of the Acquisition, and the Acquisition is conditional on this investment completing. Fresh has itself convened an extraordinary general meeting of its shareholders, which is to be held on or before 22 December 2007, to, inter alia, approve the Baring investment. Kasei 2000 has an option to acquire approximately 30% of the current issued share capital in Fresh, from one of the existing shareholders of Fresh, which it intends to do immediately prior to the Acquisition, and it has undertaken to sell such acquired shares to the Company. The Company has conditionally agreed to pay a total of £6.45 million for the acquisition of not less than 95.2% of the shares in Fresh following the Baring investment. This will be satisfied by the allotment and issue of 5,883,955 New Ordinary Shares, credited as fully paid, at a price of £1.0962 per New Ordinary Share. Should the Company acquire 100% of the shares in Fresh, the acquisition price would be £6.775 million and this would be satisfied by the issue of a further 296,482 New Ordinary Shares at a price of £1.0962 per New Ordinary Share. Fresh is a privately-held leading provider of interactive digital television solutions to the Spanish market. Established in 2000 by the current management team, its principal activity is the production and development of technology and solutions for digital television. Fresh offers a broad range of interactive digital television solutions to some of the leading international media groups including Digital+, Euskaltel and Jazztel in Spain, BSkyB, ITV and Music Choice in the United Kingdom and Disney Television International, Universal Studios Network and Warner Bros. Fresh has 28 employees, the majority of whom are engaged in the development of technology and the products offered. Sales and marketing activities are conducted primarily in Spain, UK, Italy and South America. Fresh technology is widely deployed in digital TV set top boxes in the Spanish market and enables digital TV providers to offer interactive services to broadcasters and viewers on their services. The Fresh portfolio is complementary to YooMedia products and offerings, but is also designed to operate on several digital TV platform technologies as used in territories other than the UK. Fresh has five principal product offerings: * startv provides basic levels of interactive functionality such as electronic programming guide, operator information portals, system configuration, news and other information services. * entertv is based on the creation of interactive tools for the enrichment of the viewing experience through additional content and participatory services such as voting, contests and loyalty services. entertv allows an operator to generate their own services, personalising the content and enabling access to the services through different devices such as mobile telephones. * grouptv is aimed at offering a community environment for the television user through instant messaging, SMS/MMS, forums, email and chat services. The community would be based around a programme, event or channel to engender viewer loyalty, enrich the viewing experience and provide revenue opportunities. * challengetv provides the ability to offer interactive gaming and betting services and integrate different media such as television, internet and mobile telephone and thereby maximising revenue generating opportunities. * managetv provides a powerful tool to capture information on registered users through unique identity and thereby offer content that meets the users' interests, likes and needs and provide a more personalised service to that user. For the year ended 31 December 2006, Fresh had revenues of €2.0 million and profit on ordinary activities before taxation of €96,000. For the 9 months to 30 September 2007, Fresh had turnover of (unaudited) €1.4 million and profit on ordinary activities before taxation of €50,000. As at 30 September 2007 Fresh had net assets of €0.7 million. THE Placing The Company is further proposing to raise £7.6 million (net of expenses) through the placing of 7,845,284 new ordinary shares at £1.0962 per share ("Placing Shares"). This, together with the Baring investment in Fresh, will result in available cash, after expenses, for the enlarged Group of £11.8 million. The Directors have examined a number of suitable fund-raising opportunities for the Company and believe that the Placing is the most suitable opportunity available to the Company and that it is in the best interests of Shareholders as a whole. The Placing Shares proposed to be placed pursuant to the Placing will represent 39.82 per cent. of the enlarged share capital of the Company on completion of the Proposals. On completion of the Proposals, at the placing price per New Ordinary Share, the Company will have a market capitalisation of approximately £21.6 million. The Placing Shares will rank pari passu with the New Ordinary Shares including the right to all dividends and other distributions declared, paid or made after the date of issue. The Directors intend to use the net proceeds of the Placing for working capital purposes for the enlarged Group. Proposed settlement agreements On 10 May 2006, the Company entered into convertible loan agreements with Highbridge and Platinum. At the date of this document, the Company owes Highbridge and Platinum the sums of £2.87 million and £2.34 million respectively and it has been conditionally agreed to settle these sums in full through the allotment and issue of 2,620,944 New Ordinary Shares and 2,133,119 New Ordinary Shares respectively at £1.0962 per share. Proposed directors' fees capitalisation Certain Directors have agreed to defer amounts of salary and fees due to them. They have now agreed to waive certain amounts and accept part of outstanding net salaries and fees through the proposed issue of New Ordinary Shares at a price of £1.0962 per New Ordinary Share. It is proposed that this should be done as part of the Proposals, as detailed below: Director Outstanding Sum (£) No. of New Ordinary Shares Dr Michael Sinclair £250,000 228,061 Neil MacDonald £22,500 20,525 John Swingewood £50,000 45,612 Jeremy Fenn £15,000 13,684 Under AIM Rule 13 the proposed Directors' Fee Capitalisation in relation to Dr Michael Sinclair, Chairman, is a related-party transaction. The Directors, save for Dr Michael Sinclair consider, having consulted with Seymour Pierce Limited, that the terms of the transaction are fair and reasonable in so far as Shareholders are concerned. TRADING UPDATE The Board is also intending to sell the entire issued share capital of its subsidiary, YooMedia Dating Group Limited, for £250,000 to be satisfied in cash. YooMedia Dating Group Limited, which trades under the brand name Dateline, operates an online and offline dating business, is currently loss making and has seven employees. Earlier this year another YooMedia dating subsidiary, trading under the brand "Avenues", was committed to receivership. The disposal of Dateline will mark the final stage in YooMedia's exit from the dating sector and the further progression in management's policy of restructuring and repositioning the Group's operations for future growth. The interim results for the six months to 30 June 2007, announced on 28 September 2007, highlighted that the results reflected a period of restructuring and repositioning across the YooMedia business. Significant improvements in operating margins and reduction of losses have been achieved during a period of rapid market changes. The Board also noted that in July it had granted an option to Kasei to acquire the Company's subsidiary, The Gaming Channel Ltd, for a consideration of £5.25 million. On 19 September 2007 the Company announced that the option had been extended to allow for a continuation in its negotiations with Kasei, which might, if concluded, result in Kasei becoming involved in the Group as a whole. With these discussions underway, the Directors believed that YooMedia would have access to sufficient resources to support the growth of the business. On completion of the Proposals it has been agreed that this option will terminate. Trading since the announcement of the interim results has not improved to the level of revenue and gross profit required to achieve positive earnings before tax, depreciation and amortisation before the year end. Reduced levels of demand in the interactive broadcast sector have continued into the second half of the year, and whilst new product revenue streams show encouraging signs, they are not yet cash generative. The Directors have explored a number of other financing options in order to provide working capital to satisfy outstanding creditors and provide sufficient working capital for YooMedia going forward. Following this, the Directors believe that the Proposals offer the best solution to the Group's current working capital requirements as well as providing a stronger platform for growth of the Group following completion of the Proposals. However, the Directors believe that if Shareholders do not support the Proposals, the Company may not have sufficient working capital to meet its creditors' obligations as they fall due. Furthermore, recourse to alternative sources of finance may not be possible in the time available. Proposed Change of Directors The Board has agreed that José Luis Vázquez, currently Chief Executive Officer of Fresh, and Rafael Martín Sanz, a director of Kasei, will be appointed to the board of the Company on completion of the Proposals. It is intended that José Luis Vázquez will become Chief Executive Officer of the enlarged Group. John Swingewood and Jeremy Fenn will step down from the Board on completion of the Proposals. THE TAKEOVER CODE Under Rule 9 of the Takeover Code, any person who acquires an interest in shares (as defined in the Takeover Code) which, taken together with any interest in shares already held by him or any interest in shares held or acquired by persons acting in concert with him, carry 30 per cent. or more of the voting rights of a company which is subject to the Takeover Code, is normally required to make a general offer to all the remaining shareholders to acquire their shares. Similarly, when any person, or persons acting in concert, are already interested in shares which in aggregate carry not less than 30 per cent. but who do not hold more than 50 per cent. of the voting rights of such a company a general offer will normally be required if any further interest in voting shares is acquired. An offer under Rule 9 must be in cash and at the highest price paid for any interest in shares by that person or any person acting in concert with it within the 12 months prior to the announcement of the offer. As part of the Proposals, Kasei will both subscribe for up to 7,799,672 New Ordinary Shares in the Placing and receive 684,189 New Ordinary Shares as part of the Acquisition following the exercise of its option to acquire shares in Fresh as mentioned above. In aggregate, on completion of the Proposals, Kasei would therefore have an interest in up to 43.06% of the enlarged issued ordinary share capital of the Company. Therefore the Proposals will be conditional, inter alia, on Shareholders passing, on a poll at the EGM to be convened, a waiver of the requirement under Rule 9 of the Takeover Code for Kasei to make an offer for the entire issued share capital of YooMedia. The circular convening the EGM will itself be subject to approval by the Takeover Panel. The YooMedia board intends to despatch the circular to Shareholders and to convene the EGM to seek approval of the above Proposals from its Shareholders at the earliest opportunity. 6th December 2007 Enquiries: YooMedia PLC +44 (0) 207 462 0870 Neil MacDonald, CEO Nexus Financial Ltd +44 (0) 207 451 7068 Nicholas Nelson/John Mundy Nicholas.nelson@nexusgroup.co.uk Seymour Pierce Limited +44 (0) 207 107 8000 Mark Percy

Companies

Mirada (MIRA)
UK 100

Latest directors dealings