Placing

Northern Bear Plc
02 August 2007



                               Northern Bear Plc

                       ('Northern Bear' or the 'Company')

 Proposed Placing of 2,415,250 new ordinary shares of 1p each at 145 pence per
        share to raise approximately £3.5 million gross (the 'Placing')

Introduction

The board of the Company ('Board') is pleased to announce that Northern Bear,
the integrated North of England based building materials and services supplier,
proposes to raise approximately £3.5 million (before expenses) by way of a
placing of 2,415,250 new ordinary shares of 1p each in the Company ('Placing
Shares') at a price of 145p per share (the 'Placing Price').

Reasons for the Placing

Since its admission to AIM on 19 December 2006, Northern Bear has completed the
acquisitions of MGM Limited, Chirmarn Holdings Limited and Hastie Limited and
the Board remains encouraged by the increasing number of opportunities for
potential acquisitions being presented to it. Accordingly, the net proceeds of
the Placing, which are expected to amount to approximately £3.15 million, will
be applied to progressing the Company's acquisition policy, being the
acquisition of mature, North East based owner-managed businesses in the
buildings services and materials sector which demonstrate consistent
profitability and positive operating cash flow.

In line with its stated strategy, the Company has negotiated non-binding heads
of agreement in connection with three separate potential acquisitions.
Completion of each is subject to, inter alia, a satisfactory due diligence
review (which is yet to be undertaken) and to an appropriate sale and purchase
agreement being negotiated and being acceptable to all relevant parties.
Therefore, there can be no certainty that any or all of these potential
acquisitions will proceed to completion.

Current trading and dividend policy

As indicated at the time of the Company's preliminary announcement of results on
14 June 2007, the current financial year has got off to a very satisfactory
start and the Board looks forward to the future with confidence.

The Board remains committed to implementing a progressive dividend policy and,
subject to no unforeseen circumstances arising, intends to pay an initial
dividend no later than in respect of the 6 month period ending 30 September
2008.

The Placing

Dawnay, Day Corporate Broking (a division of Dawnay, Day Brokers Limited) and
Strand Partners Limited ('Strand'), as Placing Agents, on behalf of the Company,
have conditionally placed 2,415,250 Placing Shares with institutional and other
investors at the Placing Price to raise net proceeds of approximately £3.15
million after total costs of approximately £0.35 million. The Placing Shares
will, on admission to trading on AIM, be credited as fully paid and rank pari
passu in all respects with the existing issued ordinary shares of 1p each in the
Company ('Ordinary Shares'), including the right to receive all dividends and
other distributions declared, made or paid on the Ordinary Shares after that
date.

Furthermore, Strand will subscribe (utilising certain of the monies payable to
it by way of fees, in connection with the Placing) for 13,793 new Ordinary
Shares at the Placing Price ('Strand Shares') which will credited as fully paid 
and rank pari passu in all respects with the existing issued Ordinary Shares.

Due to the size of the Placing relative to the Company's existing authority to
allot shares, the Placing is conditional (amongst other things) upon the passing
of certain resolutions by the Company's shareholders at an Extraordinary General
Meeting ('EGM') of the Company to be held on 30 August 2007. A circular
containing a notice of the EGM is being posted to the Company's shareholders
today.

Application will be made to the London Stock Exchange for the Placing Shares and
the Strand Shares to be admitted to trading on AIM. It is expected that,
conditional upon the passing at the EGM of the resolutions necessary to effect
the Placing, dealings in the Placing Shares will commence on 31 August 2007.

The Placing Shares represent approximately 17.95 per cent. of the current issued
share capital of the Company. Following the Placing and the allotment of the
Strand Shares there will be 15,887,612 Ordinary Shares in issue. The Placing
Shares and the Strand Shares together represent approximately 15.29 per cent. of
the enlarged issued share capital.

The Company also announces that Graham Forrest (Chief Executive) has agreed, in
principle, to sell up to 84,500 Ordinary Shares at the Placing Price ('Sale
Shares'), such sale being subject to, inter alia, completion of the Placing.

In the event that the sale by him of the Sale Shares proceeds to completion,
Graham Forrest will have the following interest in the enlarged issued share
capital:

                       Number of          Total number of          
                 Ordinary Shares          Ordinary Shares          % of Enlarged
Director              to be sold      held following sale          Share Capital
                      
Graham Forrest            84,500                2,553,014                  16.07

Jon Pither, Chairman of Northern Bear, commented: 'We are delighted that this
placing has been completed successfully and it is gratifying to witness such
high levels of demand from a variety of quality investors. This clearly
illustrates their confidence in our business model and we believe that the
placing makes both strategic and commercial sense as we take Northern Bear to
the next stage of its development.'

                                  * * ENDS * *

Enquiries please contact:

Northern Bear Plc
Graham Forrest, Chief Executive
0191 371 2934

Strand Partners Limited
James Harris / Braden Saunders
020 7409 3494

Dawnay, Day Corporate Broking (a division of Dawnay, Day Brokers Limited)
Ian McLean
0131 225 3825




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