Proposed Acquisition

NewMedia SPARK PLC
11 September 2000


                     NewMedia SPARK plc
     Proposed acquisition of  NewMedia Investors Limited


NewMedia  SPARK plc ('SPARK') announced today that,  subject
to  shareholder approval, it is to acquire the entire issued
share  capital  of NewMedia Investors Limited  ('NMI'),  the
technology  corporate  finance house.   NMI  will  become  a
wholly-owned subsidiary of SPARK and will continue to  offer
services  to  SPARK's  investments  and  corporate   finance
advisory  services to New Economy companies  under  the  NMI
name.

Terms of the Acquisition:

 *   NMS will acquire NMI for £10 million to be satisfied by
     the issue of 14,684,288 new SPARK shares.

Key reasons for the Acquisition:

 *   Cancellation of the Founder Agreement:  At the time of
     flotation in October 1999, SPARK entered into an agreement
     with NMI ('the Founder Agreement') under which NMI undertook
     to give SPARK first refusal on its relevant deal flow and to
     carry  out  a range of deal negotiation and  investment
     monitoring functions for SPARK in return for certain fees.
     Due to the expansion of SPARK the costs of this arrangement
     have escalated.  The Acquisition will remove this increasing
     cost and will immediately be cash-flow positive for SPARK as
     the increased overheads will be less than the payments under
     the management agreement.

 *   SFA  regulation:  The Acquisition will bring an  SFA
     regulated entity into the SPARK structure and give SPARK the
     opportunity to offer further services.
     
 *   Operational issues:  The Acquisition will allow SPARK
     to employ the staff managing its portfolio directly and to
     incentivise them appropriately.

Commenting  on  the acquisition, Michael  Whitaker,  CEO  of
SPARK said:

'SPARK  is  now  the largest quoted early  stage  technology
investment fund in Europe.  The acquisition of NMI will
cut costs, allow us to widen our regulated   activities
and   manage   our   business   more effectively.   The 
enlarged  group  will  have  a  stronger corporate
structure,  facilitating  further   growth and allowing
us to maximise returns for our shareholders.'

For further information, please contact:
Michael Whitaker                        020 7851 7600
NewMedia SPARK plc
Richard Compton-Burnett                 020 7851 7777
NewMedia Investors Limited
Tim Anderson/Isabel Petre               020 7466 5000
Buchanan Communications

Introduction

SPARK  is  proposing, subject to prior Shareholder approval,
to  enter  into  an agreement to acquire the  entire  issued
share  capital  of  NMI  from Glasshouse  Associates  for  a
consideration  to  be  satisfied  by  the   issue   of   the
Consideration  Shares (representing 4.6  per  cent.  of  the
enlarged  issued  share capital of the  Company  immediately
following  Admission). The consideration to be  paid  values
NMI  at approximately £10 million based on a share price  of
68.1p  (being the average Closing Price over the ten dealing
days up to and including 7September 2000).

Glasshouse Associates is a company in which Thomas  Teichman
and  Andrew  Carruthers will be interested as  shareholders.
Their  shares in Glasshouse Associates will be held  through
their interests in the Teichman Guernsey Settlement of which
Thomas  Teichman  is  a  beneficiary and  Blaze  Limited,  a
company  owned  equally by Andrew Carruthers and  his  wife,
which  together  will hold 66per cent. of the  issued  share
capital of Glasshouse Associates. NMI will be a wholly-owned
subsidiary  of  Glasshouse Associates. In  addition,  Thomas
Teichman  and Andrew Carruthers are directors of  SPARK  and
are  also  directors of Glasshouse Associates.  Accordingly,
under  the  AIM  Rules, the Acquisition is a  related  party
transaction.

Under  the  AIM  Rules,  the Acquisition  does  not  require
shareholder  approval. However, the Board has  been  advised
that section320 of the Act, which requires prior approval by
shareholders of certain transactions between a  company  and
its  directors or persons connected with them, is likely  to
apply  to  the  Acquisition.  Accordingly,  the  Company  is
seeking  prior  approval from shareholders  before  entering
into the Acquisition Agreement.

Background

At the time of the flotation of SPARK in October 1999, SPARK
entered  into a management agreement with NMI (the  'Founder
Agreement').  Under the Founder Agreement, NMI undertook  to
give  SPARK first refusal on its relevant deal flow  and  to
carry  out a range of deal negotiation and investee  company
monitoring  functions  for SPARK, in return  for  an  annual
general  fee of 2per cent. of SPARK's funds under management
together  with specific fees on individual deals.  This  was
advantageous  to  SPARK at a time when it was  a  relatively
small  company,  as it gave SPARK access to NMI's  extensive
expertise  and deal flow at a relatively modest cost.  Since
flotation,  SPARK has grown rapidly and is now a substantial
business  with a portfolio of 47investments, net  assets  of
£173  million at 31March 2000 and operations in  Scandinavia
and Germany in addition to those in the UK.

Reasons for the Acquisition

The Independent Directors believe that it is now
advantageous to acquire NMI for the following reasons:-

Operational Issues

SPARK  has relatively few UK based direct employees, with  a
substantial  amount of the work on SPARK's  portfolio  being
undertaken  by  NMI's personnel on SPARK's  behalf.  Due  to
SPARK's   rapid   growth   since  its   formation,   several
operational issues have now arisen which require remedy:

  *  Operationally, SPARK has become increasingly complex to
     manage.  SPARK now wishes to employ all its  own  staff
     directly and it believes that the NMI team is one of the
     most talented and most experienced in Europe. SPARK believes
     that it would be difficult to replicate this team in a short
     time-frame.
  
  *  The market generally (including Shareholders, clients
     and industry contacts) may be confused by the inter-
     relationship between SPARK and NMI.

  
  *  Incentivisation of staff has become more difficult as
     key individuals are working for different organisations.
     SPARK wishes to employ the team working on its portfolio
     directly  so  that it can implement suitable  incentive
     arrangements for them.


SFA Regulated Activities

The  majority  of  the work which NMI undertakes  for  SPARK
pursuant  to  the  Founder Agreement amounts  to  investment
business  and, therefore, must be carried out by  an  entity
regulated  under  the  Financial Services  Act  1986.  SPARK
believes  that  it will be advantageous to have  within  its
corporate structure an SFA regulated entity as it will widen
the range of activities which can be carried out directly by
SPARK.

SPARK has been in discussions with a number of institutional
funds  with regard to the provision of services relating  to
investment in high-growth internet and technology companies.
These  activities  can only be carried out  by  a  regulated
entity.  In  addition, NMI has historically  carried  out  a
substantial amount of corporate finance advisory work in the
new economy area.

Cancellation of the Founder Agreement

The  proposed  Acquisition will enable SPARK to  cancel  the
Founder  Agreement which was put in place  at  a  time  when
SPARK  was a much smaller entity. With the additional  funds
which  SPARK  has raised and acquired since  flotation,  the
payments  under  the contract have grown  significantly  and
will  grow  further still if SPARK continues  to  expand  at
current  rates.  The  acquisition of NMI  will  remove  this
growing cost. At the current level of SPARK's activities the
transaction will be immediately cash-flow positive for SPARK
as  the  increased overheads will be less than the  payments
under the Founder Agreement.

Information on NMI

Founded  in  1996  by Thomas Teichman and  Richard  Compton-
Burnett,  NMI  has  developed a strong  niche  in  corporate
finance  and venture capital advisory work in the technology
sector.  The  business enjoyed early success by advising  on
transactions  for  some  high  profile  companies  including
Lastminute.com  plc, Argonaut Games plc,  ARC  International
plc,  wgsn.com  and silicon.com. NMI's team has  advised  on
over 50 transactions with an aggregate value in excess of £1
billion. The credibility earned by its team and some of  its
transactions, together with the strength of the  market  for
technology companies, has enabled the business to grow  very
quickly over the last fifteen months. Over this period,  the
team grew from eight to twenty-six people.

Lastminute.com  and  Argonaut  Games  plc,   have   recently
completed  IPOs on the London Stock Exchange.  In  addition,
ARC  International plc has recently announced its  intention
to float on the London Stock Exchange.

NMI's  team  is  drawn  from a broad range  of  professional
backgrounds reflecting the range of skills needed to  advise
early  stage  technology companies. Executives  have  joined
from   investment  banking  (CSFB,  NMRothschild,   Dresdner
Kleinwort Benson, UBS Warburg, Lazard, Schroders and Merrill
Lynch),  consulting  (LEK and OC&C),  accounting  (KPMG  and
Deloitte   &  Touche),  law  (Baker  &  McKenzie),  newmedia
(Hollinger  Digital,  Sky and boo.com) and  venture  capital
(Mercury  Asset Management). Part of NMI's success has  been
based  on  its  contacts  with  entrepreneurs,  the  venture
capital   and  investing  communities  and  the   technology
industry.


Prior  to completion of the Acquisition, NMI will undergo  a
corporate re-organisation involving the incorporation  of  a
new holding company, Glasshouse Associates, from which SPARK
will  purchase NMI. The holding company will retain most  of
the investments which NMI has made over the past four years.
These  include the shareholdings in SPARK itself and  in  EO
plc.  SPARK  already  has  a shareholding  in  EO  plc,  and
although  SPARK  believes EO plc to be a  highly  attractive
investment,   the   cost  of  acquiring   NMI's   additional
shareholding  in  EO plc would be too high  in  relation  to
SPARK's focus on early stage investments.

SPARK will acquire as part of this transaction half of NMI's
32.6  per  cent. shareholding in NewMedia Heads Limited,  an
executive search company focusing on placing executives into
new  economy companies, which was founded in February  2000.
This  company  has  experienced  strong  growth  since   its
formation.

Turnover of NMI for the years ended 31March 1999 and 31March
2000  was  £505,013  and  £2,064,361  respectively.  Profits
before  tax for the same periods were £149,091 and £309,876.
Net  assets  at  31March  2000  were  £1,550,234  and   at
completion   are  expected  to  be  approximately  £500,000
following  the  proposed re-organisation and  excluding  the
investments not being acquired by SPARK.

Principal Terms of the Acquisition

Under  the  terms  of the Acquisition Agreement,  SPARK  has
agreed  to acquire the whole of the issued share capital  of
NMI  from  Glasshouse  Associates  for  a  consideration  of
approximately £10 million to be satisfied by  the  issue  of
the Consideration Shares.

Under  the Acquisition Agreement, Glasshouse Associates  and
the  Warrantors  have agreed to give normal  warranties  and
certain  indemnities  in respect of taxation.  In  addition,
Glasshouse Associates and the Warrantors have agreed not  to
compete  with  NMI  for  a  period  of  one  year  following
completion of the Acquisition Agreement.

The Acquisition Agreement will only be entered into if SPARK
shareholders pass the resolution to be proposed at the EGM
being convened for 26 September 2000 and receipt of approval from
the SFA to the proposed reorganisation of NMI and its subsequent 
acquisition by SPARK.


Under the Founder Agreement, SPARK was granted an option  to
purchase  6,688 shares in NMI (approximately 10per cent.  of
the  then issued share capital of NMI) for nil consideration
at  an  aggregate  subscription  price  of  £2,000,000.  The
Independent Directors consider that it would not be  in  the
interests  of the Company to exercise this option  prior  to
the  acquisition  of  NMI  having  regard  to  the  proposed
acquisition price for NMI.

Lock-In Arrangements

The SPARK Shares currently held by NMI are to be transferred
to   Glasshouse   Associates  as  part  of   the   corporate
reorganisation. Glasshouse Associates has agreed  under  the
terms  of the Acquisition Agreement not to dispose of  these
SPARK Shares or the Consideration Shares without the consent
of  the  Company's Nominated Adviser on or before 28 October
2001,   except  in  certain  limited  circumstances.   These
provisions reflect the lock-in arrangements that NMI entered
into with SPARK and Peel Hunt when they initially subscribed
for shares in SPARK in October 1999.

Extraordinary General Meeting

An  extraordinary general meeting of the Company to be  held
at  the offices of SPARK at 33 Glasshouse Street, London  W1R
5RG  at  11.15a.m. (or such later time as the Annual General
Meeting of the Company convened for the same date shall have
concluded or been adjourned) has been convened for 26 September 
2000, at  which a  resolution will be proposed to authorise entry 
into  the Acquisition Agreement and completion of the Acquisition.

Recommendation

Thomas Teichman and Andrew Carruthers are interested in  the
proposed  Acquisition and, accordingly, have not taken  part
in   the   Board   deliberations  concerning  the   proposed
Acquisition  and neither of them, nor any persons  connected
with  them, will vote at the Extraordinary General  Meeting.
The Independent Directors, who have consulted with Peel Hunt
in   this   regard,  believe  the  terms  of  the   proposed
Acquisition  are fair and reasonable so far as  Shareholders
are  concerned. In providing its advice, Peel Hunt has taken
into   account   the   Independent   Directors'   commercial
assessment of the Acquisition.

The  Independent Directors intend to vote in favour  of  the
Resolution  in  respect  of  their beneficial  shareholdings
amounting  to 26,042,112 SPARK Shares (representing  8.56per
cent. of the existing issued share capital of SPARK).