Offer by BSkyB

Sports Internet Group PLC 10 May 2000 Not for release, distribution or publication in whole or in part into the United States, Canada, Australia or Japan. Recommended Offer by Goldman Sachs International on behalf of BRITISH SKY BROADCASTING GROUP PLC for SPORTS INTERNET GROUP PLC The Boards of BSkyB and Sports Internet Group today announce the terms of a recommended offer for all the issued and to be issued share capital of Sports Internet Group. - The Offer is being made on the basis of 0.5622 New BSkyB Shares for each Sports Internet Group Share. On the basis of the Closing Middle Market Price of 1512p per BSkyB Share on 9 May 2000, the last business day prior to the date of this announcement, the Offer values each Sports Internet Group Share at approximately 850p and the existing issued share capital of Sports Internet Group at approximately £301.3 million. - The Offer represents a premium of approximately 34.4 per cent. over the Closing Middle Market Price of a Sports Internet Group Share on 28 April 2000, the last business day prior to the date on which Sports Internet Group announced that it was in talks which might lead to an offer, and 10.0 per cent. over the Closing Middle Market Price of a Sports Internet Group Share on 9 May 2000, the last business day prior to the date of this announcement. - BSkyB has received irrevocable undertakings to accept the Offer from all the shareholder directors of Sports Internet Group in respect of approximately 18.2 million Sports Internet Group Shares representing approximately 51.5 per cent. of Sports Internet Group's existing issued share capital. - BSkyB attaches great importance to the skills and experience of the Sports Internet Group management team and intends that they will contribute to the development of skysports.com. - The Board of BSkyB believes that the combination of Sports Internet Group and skysports.com will create one of the UK's leading sports portals. The Board of BSkyB also believes that skysports.com will be able to capitalise on Sports Internet Group's existing infrastructure and expertise in producing and managing sports websites and operating betting services. Commenting on today's announcement, Tony Ball, Chief Executive Officer of BSkyB, said: 'This is a valuable acquisition for BSkyB because Sports Internet Group has an established infrastructure, original content, high user volumes and an exciting e-commerce potential. It confirms our strong commitment to new media by offering the very best content to people wherever and whenever they want it. We are also delighted to have secured the services of the Sports Internet Group management team to drive skysports.com through the next phase of its development. They are innovative with proven skills in building a leading on-line sports business. The business and the people provide a terrific fit for BSkyB. I have every confidence that we will continue to occupy a leading position in the broadband era.' Commenting on today's announcement, Peter Wilkinson, Executive Deputy Chairman of Sports Internet Group, said: 'I am delighted to recommend the offer made by BSkyB to Sports Internet shareholders. The services Sports Internet Group offers Sky are truly complementary to its existing output. I am personally delighted to be working with a company which is at the forefront of the broadband revolution. I believe that this is a very exciting step for both companies.' This summary should be read in conjunction with the full text of the attached press release. Enquiries: BSkyB 020 7705 3000 ANALYSTS/INVESTORS MARTIN STEWART Roger Blundell Press Julian Eccles GOLDMAN SACHS INTERNATIONAL 020 7774 1000 RICHARD CAMPBELL-BREEDEN Francis Crispino Bell Pottinger 020 7353 9203 WENDY TIMMONS Sports Internet Group 01423 700800 Peter Wilkinson Jeremy Fenn UBS WARBURG 020 7567 8000 Alex Wilmot-Sitwell Andrew Bracey College Hill 020 7457 2020 NICOLA WEINER Archie Berens The Offer will not be made, directly or indirectly, in or into, or by the use of the mails or any means or instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, the US, or in or into Canada, Australia or Japan and the Offer will not be capable of acceptance by any such use, means, instrumentality or facilities or from within the US, Canada, Australia or Japan. Doing so may render invalid any purported acceptance. Accordingly, copies of this announcement are not being, and must not be, mailed or otherwise forwarded, distributed or sent in or into or from the US, Canada, Australia or Japan and all persons receiving this announcement (including nominees, trustees or custodians) must not mail or otherwise forward, distribute or send it into or from the US, Canada, Australia, or Japan. The New BSkyB Shares have not been, and will not be, registered under the United States Securities Act of 1933, as amended or under securities laws of any state of the US. Furthermore, the relevant clearances have not been, and will not be, obtained from the securities commission of any province of Canada, nor any city or prefecture of Japan. No prospectus in relation to the New BSkyB Shares has been, or will be, lodged with or registered by the Australian Securities Commission. Accordingly, except pursuant to an exemption, if available, from any applicable registration requirements or otherwise in compliance with all applicable laws, the New BSkyB Shares may not be offered, sold, resold or delivered, directly or indirectly, in or into the United States, Canada, Australia or Japan nor to or for the account or benefit of any person resident in the United States, Canada, Australia or Japan. Goldman Sachs International, which is regulated in the United Kingdom by The Securities and Futures Authority Limited, is advising BSkyB in connection with the Offer and no-one else and will not be responsible to anyone other than BSkyB for providing the protections afforded to customers of Goldman Sachs International nor for providing advice in relation to the Offer. UBS Warburg, a financial services group of UBS AG, which is regulated in the United Kingdom by The Securities and Futures Authority Limited, is advising Sports Internet Group in connection with the Offer and no-one else and will not be responsible to anyone other than Sports Internet Group for providing the protections afforded to customers of UBS Warburg nor for providing advice in relation to the Offer. Goldman Sachs International and Credit Suisse First Boston de Zoete & Bevan Limited are joint brokers to BSkyB. This announcement does not constitute an offer or invitation to purchase any securities. Recommended Offer by Goldman Sachs International on behalf of BRITISH SKY BROADCASTING GROUP PLC for SPORTS INTERNET GROUP PLC 1. INTRODUCTION The Boards of BSkyB and Sports Internet Group today announce that they have reached agreement on the terms of a recommended offer to be made by Goldman Sachs International on behalf of BSkyB for all the issued and to be issued share capital of Sports Internet Group. The Offer is being made on the basis of 0.5622 New BSkyB Shares for each Sports Internet Group Share. On the basis of the Closing Middle Market Price of 1512p per BSkyB Share on 9 May 2000, the last business day prior to the date of this announcement, the Offer values each Sports Internet Group Share at approximately 850p and the existing issued share capital of Sports Internet Group at approximately £301.3 million. BSkyB has received irrevocable undertakings to accept the Offer from all the shareholder directors of Sports Internet Group in respect of 18.2 million Sports Internet Group Shares representing approximately 51.5 per cent. of Sports Internet Group's existing issued share capital. BSkyB attaches great importance to the skills and experience of the Sports Internet Group management and intends that they will contribute to the development of skysports.com. The Sports Internet Group Board, which has been so advised by UBS Warburg, financial adviser to Sports Internet Group, considers the terms of the Offer to be fair and reasonable and unanimously recommends all Sports Internet Group Shareholders to accept the Offer. In providing advice to the Sports Internet Group Board, UBS Warburg has taken into account the Sports Internet Group Board's commercial assessments. 2. TERMS OF THE OFFER On behalf of BSkyB, Goldman Sachs International will offer to acquire, subject to the conditions and further terms set out below, in Appendix I and in the formal offer document and form of acceptance, all the issued and to be issued share capital of Sports Internet Group on the following basis: For each Sports Internet 0.5622 New BSkyB Shares Group Share On the basis of the Closing Middle Market Price of a BSkyB Share of 1512p on 9 May 2000 (the last business day prior to the date of this announcement), the Offer values each Sports Internet Group Share at approximately 850p, representing a premium of approximately 10.0 per cent. over the Closing Middle Market Price of 772.5p per Sports Internet Group Share on 9 May 2000, and a premium of approximately 34.4 per cent. over the Closing Middle Market Price of 632.5 p on 28 April 2000, the last business day prior to the date on which Sports Internet Group announced it was in talks which may lead to an offer. Full acceptance of the Offer, assuming exercise of all options and rights outstanding as detailed in Appendix II, would result in the issue of approximately 21.8 million New BSkyB Shares, representing approximately 1.2 per cent. of BSkyB's enlarged issued share capital. Application will be made for the New BSkyB Shares to be admitted to the Official List and to begin trading on the London Stock Exchange. The New BSkyB Shares will not be registered under the United States Securities Act of 1933, as amended. The Sports Internet Group Shares which are the subject of the Offer will be acquired by BSkyB fully paid and free from all liens, charges, equitable interests, third party rights and encumbrances and together with all rights now or hereafter attaching thereto, including the right to receive all dividends and other distributions (if any) declared, made or paid after the date of this announcement. The New BSkyB Shares issued pursuant to the Offer will be issued credited as fully paid and will rank pari passu in all respects with the existing BSkyB Shares including the right to receive and retain in full all dividends and other distributions declared, made or paid after the date of this announcement. Further details of the bases and sources of thethis financial information on, and the financial effects of acceptance of, the Offer are set out in Appendix II. 3. IRREVOCABLE UNDERTAKINGS BSkyB has received irrevocable undertakings to accept the Offer from all the shareholder directors of Sports Internet Group in respect of 18.2 million Sports Internet Group Shares representing approximately 51.5 per cent. of Sports Internet Group's existing issued share capital. BSkyB has also received an irrevocable undertaking from Hay & Robertson plc to accept the Offer in respect of approximately 1.8 million Sports Internet Group Shares to be issued to it on completion of the agreement dated 7 February 2000 in respect of the acquisition by Sports Internet Group of 49 per cent. of the issued share capital of Sports Etail Limited. The undertaking given by Peter Wilkinson who holds in aggregate 15.0 million Sports Internet Group Shares, representing 42.3 per cent. of the issued share capital of Sports Internet Group, will lapse if the average of the Closing Middle Market Prices of a BSkyB Share for each of the five dealing days immediately before he is required to accept the Offer is less than £11.75. He has agreed not to withdraw his acceptance thereafter unless the average of the Closing Middle Market Prices of a BSkyB Share for any five consecutive dealing days is less than £11.75. He has also agreed not to dispose of certain of the New BSkyB Shares he will receive pursuant to the Offer for periods of up to two years following the date on which the Offer becomes or is declared wholly unconditional. 4. BACKGROUND TO AND REASONS FOR THE OFFER BSkyB is investing in new media and skysports.com in particular. The Board of BSkyB believes that the combination of Sports Internet Group with skysports.com will create a leading sports portal in the UK. Specifically: - Scale: the combined traffic volumes will enhance the advertising revenues and e-commerce opportunities of the two companies' sports websites; - Management: the Sports Internet Group management will strengthen skysports.com's management team and provide further opportunities for the development of BSkyB's new media on-line sports properties; - Content: the combination draws together journalistic talent and associated on-line content from both companies; - Distribution: the combination will have deals with leading portals/ISPs such as Yahoo!, Freeserve and others; - Relationships:Relationships the combination will have service agreements with sports bodies (including football clubs and sports federations) for the design and maintenance of their websites; - Betting: the Enlarged Group will benefit from the expertise of Sports Internet Group in sports betting. 5. INFORMATION ON THE BSKYB GROUP BSkyB, incorporated in England and Wales in April 1988, currently operates a leading pay television broadcasting service in the United Kingdom and Ireland, with approximately 8.6 million subscribers to its services as of 31 March 2000. BSkyB Group's principal activities consist of the operation (including production of programming), marketing and distribution (both via satellite, cable and digital terrestrial television) of wholly owned television channels and the marketing and distribution to direct to home customers of channels owned and operated by third parties (including some joint ventures in which BSkyB participates). For the financial year ended 30 June 1999, BSkyB Group reported turnover of £1,545 million and a loss before tax of £389 million. As of 30 June 1999, BSkyB Group had net liabilities of £625 million. In its unaudited interim results for the six months ended 31 December 1999, BSkyB Group reported turnover of £850 million, a loss before tax of £62 million and, as at 31 December 1999, had net liabilities of £665 million. BSkyB is a constituent of the FTSE-100 Index. Based on the Closing Middle Market Price of 1512p per BSkyB Share on 9 May 2000 (the last business day prior to the date of this announcement), BSkyB's current market capitalisation is approximately £27.6 billion. 6. INFORMATION ON THE SIG GROUP Sports Internet Group is one of the UK's leading online providers of sports websites, statistics, betting and e- commerce services. Founded in 1999, Sports Internet Group has grown through acquisition and now consists of four key interdependent divisions: - Planetfootball: provision of web management and hosting services to football clubs and federations; - Opta: official statistical analysis for the FA Carling Premier League and Scottish Premier League; - Surrey Group: off-line and on-line sports betting; - Sports Etail: e-commerce business focused on the provision of on-line merchandise sales for sports federations; currently contracted to the Football Association and the England Cricket Board. Sports Internet Group now offers a combination of the above services through its own websites and websites it manages, which include Premiership and First Division football clubs and sports federations. It also maintains extensive links to major UK portals, including the provision of branded football news for Freeserve and LineOne, and statistics for Yahoo!'s FA Premiership Fantasy Football. In addition, Sports Internet Group recently announced an agreement with the Wireless Group to manage talkSport.net. Peter Wilkinson, the Executive Deputy Chairman, was the founder of Planet Online and one of the architects of Freeserve. Jeremy Fenn, the Group Chief Executive, was previously Chief Executive of Leeds Sporting plc. As of March 2000, Sports Internet Group recorded approximately 1.5 million unique users and approximately 30 million monthly page impressions making it a major sports website operator in the UK. The interim results to 31 August 1999 contained only four months of trading for Planetfootball and two months of Opta trading. In addition, the Surrey Group acquisition occurred in October 1999 and is therefore also not accounted for. Turnover for the six month period ended 31 August 1999 was £0.24 million with the loss before tax amounting to £0.82 million. As of 31 August 1999, the SIG Group had net assets of £37.8 million. 7. MANAGEMENT AND EMPLOYEES BSkyB attaches great importance to the skills and experience of the existing management and employees of Sports Internet Group and believes that they will benefit from the wider opportunities in the BSkyB Group. In particular, BSkyB expects that the senior management of Sports Internet Group will continue in their current roles. Peter Wilkinson, Executive Deputy Chairman of Sports Internet Group, and Jeremy Fenn, chief executive officer of Sports Internet Group, have entered into service agreements for initial periods of two years. BSkyB intends to invite Messrs Wilkinson and Fenn to join the board of skysports.com. BSkyB has given assurances to the directors of Sports Internet Group that the existing employment rights, including pension rights (if any), of the management and employees of the Group will be fully safeguarded. 8. SPORTS INTERNET GROUP OPTIONS The Offer will extend to any Sports Internet Group Shares issued or unconditionally allotted while the Offer remains open for acceptance (or such earlier date as BSkyB may, subject to the City Code, determine) pursuant to the exercise of share options granted under the Sports Internet Group Share Option Schemes. To the extent that such options are not exercised and in the event that the Offer becomes or is declared wholly unconditional in all respects, appropriate proposals will be made, in due course, to the holders of options under the Sports Internet Group Share Option Schemes. It is intended that such proposals will include the opportunity for option holders to exchange their subsisting options over Sports Internet Group Shares for replacement options over new BSkyB Shares on the basis of 0.5622 new BSkyB Shares for each Sports Internet Group Share. The replacement options will have an option price which will ensure that the option gain achieved on exercise of the replacement option will be at least equal to the gain that would have been achieved had the option holder exercised his subsisting option at the time of the exchange. To facilitate this exchange, an amendment will be required to the Sports Internet Group Share Option Schemes. The directors of Sports Internet Group will convene an extraordinary general meeting to approve such amendment as soon as practicable. 9. GENERAL On 9 May 2000, BSkyB agreed to purchase from Freeserve a warrant to subscribe for 400,000 Sports Internet Group Shares at an exercise price of £7.50 for each Sports Internet Group Share. The consideration for the purchase of the warrant is the issue to Freeserve of such number of new BSkyB Shares as equals the difference between the value of the Offer (calculated by reference to the Closing Middle Market Price of a BSkyB Share for the last business day prior to the date of this announcement) and the exercise price of the warrant. The acquisition is conditional upon the Offer becoming unconditional in all respects. Save as disclosed herein, neither BSkyB nor any director of BSkyB, nor to BSkyB's knowledge, any person acting in concert with BSkyB, owns or controls any Sports Internet Group Shares or holds any options to purchase any Sports Internet Group Shares or has entered into any derivative referenced to securities of Sports Internet Group which remain outstanding. In the interests of secrecy, BSkyB has not made any enquiries in this respect of certain parties who may be deemed by the Panel to be acting in concert with it for the purpose of the Offer. The availability of the Offer to Sports Internet Group Shareholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements. The formal Offer documentation will be despatched to Sports Internet Group Shareholders and participants in the Sports Internet Group Share Option Schemes as soon as is practicable. Enquiries: BSkyB Analysts/Investors 020 7705 3000 Martin Stewart Roger Blundell Press 020 7705 3000 Julian Eccles GOLDMAN SACHS INTERNATIONAL 020 7774 1000 Richard Campbell-Breeden Francis Crispino Bell Pottinger 020 7353 9203 Wendy Timmons Sports Internet Group 01423 700800 Peter Wilkinson Jeremy Fenn UBS WARBURG 020 7567 8000 Alex Wilmot-Sitwell Andrew Bracey College Hill 020 7457 2020 Nicola Weiner Archie Berens The Offer will not be made, directly or indirectly, in or into, or by the use of the mails or any means or instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, the US, Canada, Australia or Japan and the Offer will not be capable of acceptance by any such use, means, instrumentality or facility from within the US, Canada, Australia or Japan. Doing so may render invalid any purported acceptance. Accordingly, copies of this announcement are not being, and must not be, mailed or otherwise forwarded, distributed or sent in or into or from the US, Canada, Australia or Japan and all persons receiving this announcement (including nominees, trustees or custodians) must not mail or otherwise forward, distribute or send it into or from the US, Canada, Australia, or Japan. The New BSkyB Shares have not been, and will not be, registered under the United States Securities Act of 1933, as amended or under securities laws of any state of the US. Furthermore, the relevant clearances have not been, and will not be obtained from the securities commission of any province of Canada, nor any city or prefecture of Japan. No prospectus in relation to the New BSkyB Shares has been, or will be, lodged with or registered by the Australian Securities Commission. Accordingly, except pursuant to an exemption, if available, from any applicable registration requirements or otherwise in compliance with all applicable laws, the New BSkyB Shares may not be offered, sold, resold or delivered, directly or indirectly, in or into the United States, Canada, Australia or Japan nor to or for the account or benefit of any person resident in the United States, Canada, Australia or Japan. Goldman Sachs International, which is regulated in the United Kingdom by The Securities and Futures Authority Limited, is advising BSkyB in connection with the Offer and no-one else and will not be responsible to anyone other than BSkyB for providing the protections afforded to customers of Goldman Sachs International nor for providing advice in relation to the Offer. UBS Warburg, a financial services group of UBS AG, which is regulated in the United Kingdom by the Securities and Futures Authority Limited, is advising Sports Internet Group in connection with the Offer and no-one else and will not be responsible to anyone other than Sports Internet Group for providing the protections afforded to customers of UBS Warburg nor for providing advice in relation to the Offer. Goldman Sachs International and Credit Suisse First Boston de Zoete & Bevan Limited are joint brokers to BSkyB. APPENDIX I CONDITIONS AND FURTHER TERMS OF THE OFFER The Offer, which will be made by Goldman Sachs International on behalf of BSkyB, will comply with all applicable rules and regulations of the UK Listing Authority, the London Stock Exchange and the City Code, and will be governed by English law and be subject to the jurisdiction of the Courts of England. CONDITIONS OF THE OFFER The Offer will be subject to the following conditions: (a) valid acceptances being received (and not, where permitted, withdrawn) by 3.00 p.m. on the first closing date (or such later time(s) and/or date(s) as BSkyB may, subject to the rules of the City Code, decide) in respect of not less than 90 per cent. (or such lesser percentage as BSkyB may decide) of the Sports Internet Group Shares to which the Offer relates, provided that this condition will not be satisfied unless BSkyB shall have acquired or agreed to acquire, whether pursuant to the Offer or otherwise, Sports Internet Group Shares carrying, in aggregate, more than 50 per cent. of the voting rights then exercisable at a general meeting of Sports Internet Group, including for this purpose to the extent (if any) required by the Panel, any such voting rights attaching to any Sports Internet Group Shares that may be unconditionally allotted or issued before the Offer becomes or is declared unconditional as to acceptances whether pursuant to the exercise of any outstanding conversion or subscription rights or otherwise; and for this purpose: (i) the expression 'Sports Internet Group Shares to which the Offer relates' shall be construed in accordance with sections 428-430F of the Companies Act 1985; and (ii) shares which have been unconditionally allotted shall be deemed to carry the voting rights which they will carry upon issue; (b) the UK Listing Authority agreeing to admit the New BSkyB Shares to the Official List and such admission and admission to trading on the London Stock Exchange becoming effective in accordance with paragraph 7.1 of the Listing Rules and by the decision by the London Stock Exchange to admit such shares to trading being announced in accordance with the LSE Admissions Standards; (c) the Office of Fair Trading indicating, in terms satisfactory to BSkyB, that it is not the intention of the Secretary of State for Trade and Industry to refer the proposed acquisition of Sports Internet Group by BSkyB or any matter arising therefrom to the Competition Commission; (d) no government or governmental, quasi-governmental, supranational, statutory or regulatory body, court, trade agency, professional association or any other person or body in any jurisdiction (each a 'Relevant Authority') having decided to take, instituted, implemented or threatened any action, proceedings, suit, investigation or enquiry, or made, proposed or enacted any statute, regulation or order or taken any other steps and there not continuing to be outstanding any statute, legislation or order thereof, which would or might reasonably be expected to: (i) make the Offer or the acquisition by BSkyB of any Sports Internet Group Shares, or control of Sports Internet Group void, illegal or unenforceable or otherwise restrict, restrain, prohibit or otherwise materially and adversely interfere with the implementation of, or impose additional conditions or obligations with respect thereto, or otherwise materially and adversely challenge or interfere therewith; (ii) result in a delay in the ability of BSkyB, or render BSkyB unable to, acquire some or all of the Sports Internet Group Shares; (iii) require or prevent the divestiture by Sports Internet Group or any of its subsidiaries or subsidiary undertakings or any associated company or any company of which 20 per cent. or more of the voting capital is held by the SIG Group or any partnership, joint venture, firm or company in which any member of the SIG Group may be interested (the 'wider SIG Group') or by BSkyB or any of its subsidiaries or subsidiary undertakings or any associated company or any company of which 20 per cent. or more of the voting capital is held by the BSkyB Group or any partnership, joint venture, firm or company in which any member of the BSkyB Group may be interested (the 'wider BSkyB Group') of all or any portion of their respective businesses, assets or property or impose any limitation on the ability of any of them to conduct their businesses or own their assets or property in each case to an extent which is material in the context of the wider SIG Group or, as the case may be, the wider BSkyB Group provided that in the case of the wider BSkyB Group such divestiture or limitation shall be required or prevented, as the case may be, as a result, directly or indirectly, of the implementation of the Offer or the acquisition by any member of the wider BSkyB Group of shares in any member of the wider SIG Group; (iv) impose any material limitation on the ability of any member of the wider SIG Group or the wider BSkyB Group to acquire or to hold or to exercise effectively any rights of ownership of shares or loans or securities convertible into shares in any member of the wider BSkyB Group or of the wider SIG Group held or owned by it or to exercise management control over any member of the wider BSkyB Group or of the wider SIG Group provided that, in the case of the wider BSkyB Group, such limitation is imposed as a result, directly or indirectly, of the Offer or the acquisition by any member of the wider BSkyB Group of any shares in any member of the wider SIG Group; (v) require any member of the wider BSkyB Group or the wider SIG Group to offer to acquire any shares in any member of the wider SIG Group for a consideration which is material in the context of the wider SIG Group; or (vi) otherwise materially and adversely affect the financial position or prospects of any member of the wider BSkyB Group or of any member of the wider SIG Group; and all applicable waiting and other time periods during which any such Relevant Authority could decide to take, institute, implement or threaten any such action, proceeding, suit, investigation or enquiry having expired, lapsed or been terminated; (e) all necessary filings having been made, all appropriate waiting periods under any applicable legislation or regulations of any jurisdiction having expired, lapsed or been terminated, in each case in respect of the Offer and the acquisition of any Sports Internet Group Shares, or of control of Sports Internet Group, by BSkyB, and all authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals ('Authorisations') necessary or appropriate for, or in respect of, the Offer and the proposed acquisition of any Sports Internet Group Shares, or of control of Sports Internet Group, by BSkyB and to carry on the business of any member of the BSkyB Group (following the implementation of the Offer) or of the SIG Group having been obtained, in terms and in a form reasonably satisfactory to BSkyB, from all appropriate Relevant Authorities and from persons or bodies with whom any member of the SIG Group has entered into contractual arrangements (where such arrangements are material in the context of the Offer) and all such Authorisations remaining in full force and effect and there being no notice of an intention to revoke or not to renew any of the same and all necessary statutory or regulatory obligations in any jurisdiction having been complied with; (f) there being no provision of any arrangement, agreement, licence or other instrument to which any member of the wider SIG Group is a party or by or to which any such member or any of their assets may be bound, entitled or be subject and which, in consequence of the proposed acquisition of any Sports Internet Group Shares, or control of Sports Internet Group, by BSkyB or otherwise, would or might, to an extent which is material in the context of the SIG Group, reasonably be expected to, result in: (i) any monies borrowed by, or other indebtedness actual or contingent of, any such member of the wider SIG Group being or becoming repayable or being capable of being declared repayable immediately or prior to their stated maturity; (ii) the creation of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any such member or any such security (whenever arising or having arisen) becoming enforceable; (iii)any such arrangement, agreement, licence or instrument being terminated or adversely modified or any action being taken of an adverse nature or any obligation arising thereunder; (iv) any assets of any such member being disposed of other than in the ordinary course of business; (v) the interest or business of any such member in or with any firm or body or person, or any arrangements relating to such interest or business, being terminated or adversely modified or affected; (vi) any such member ceasing to be able to carry on business under any name under which it presently does so; or (vii)the financial position of the wider SIG Group being otherwise adversely affected; (g) except as publicly announced by Sports Internet Group prior to the date hereof, no member of the wider SIG Group having, since 31 August 1999: (i) issued or authorised or proposed the issue of additional shares of any class, or securities convertible into, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities (save as between Sports Internet Group and wholly-owned subsidiaries of Sports Internet Group and save for options granted, and for any Sports Internet Group Shares allotted upon exercise of options granted under the Sports Internet Group Share Option Schemes) or redeemed, purchased or reduced any part of its share capital; (ii) declared, paid or made or proposed to declare, pay or make any bonus in respect of shares, dividends or other distribution other than to other members of the wider SIG Group; (iii)authorised or proposed or announced its intention to propose any merger or demerger or acquisition or disposal of assets or shares (other than in the ordinary course of trading) or any such material change in its share or loan capital; (iv) issued or proposed the issue of any debentures or incurred any indebtedness or contingent liability; (v) disposed of or transferred, mortgaged or encumbered (save for mortgages and encumbrances arising by operation of law) any asset or any right, title or interest in any asset in any manner; (vi) entered into any contract or commitment (whether in respect of capital expenditure or otherwise) which is of a long-term or unusual nature or involves or could involve an obligation of such a nature or magnitude; (vii)entered into any reconstruction, amalgamation, transaction or arrangement (otherwise than in the ordinary course of business); (viii)taken any corporate action or had any order made for its winding-up, 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; (ix) entered into or varied the terms of any service agreement with any of the directors of Sports Internet Group; or (x) entered into any agreement or commitment or passed any resolution with respect to any of the transactions or events referred to in this paragraph (g); (h) since 31 August 1999, except as publicly announced by Sports Internet Group prior to the date hereof: (i) there having been no material adverse change in the business, financial or trading position or prospects of any member of the wider SIG Group; (ii) no litigation, arbitration proceedings, prosecution or other legal proceedings having been instituted, announced or threatened by or against or remaining outstanding against any member of the wider SIG Group which in any such case would be material in the context of the wider SIG Group; (i) BSkyB not having discovered that: (i) the financial or business information concerning the wider SIG Group as contained in the information publicly disclosed at any time by any member of the wider SIG Group and which is material in the context of the Offer and which was not, if material, corrected by a subsequent public announcement either contains a material misrepresentation of fact or omits to state a fact necessary to make the information contained therein not materially misleading; or (ii) any member of the wider SIG Group is subject to any liability, contingent or otherwise, which is not disclosed in the interim report for the six months to 31 August 1999 and which is material in the context of the Offer and which was not, if material, corrected by a subsequent public announcement; and (j) in relation to any release, omission, disposal or other fact or circumstance which causes or might cause pollution of the environment or harm to human health, no past or present member of the SIG Group having, in any manner, to an extent which is material in the context of the wider SIG Group (i) committed any violation of any laws, statutes, ordinances, regulations or other requirements of any Relevant Authority; and/or (ii) incurred any liability (whether actual or contingent) with respect thereto. BSkyB reserves the right to waive, in whole or in part, all or any of conditions (c) to (j) inclusive. If BSkyB is required by the Panel to make an offer for Sports Internet Group Shares under the provision of Rule 9 of the City Code, BSkyB may make such alterations to the above conditions, including condition (a) above, as are necessary to comply with the provisions of that Rule. The Offer will lapse if the acquisition of Sports Internet Group by BSkyB is referred to the Competition Commission before 3.00 pm on the first closing date of the Offer or the date on which the Offer becomes or is declared unconditional as to acceptances, whichever is the later. If the Offer so lapses the Offer will cease to be capable of further acceptance and accepting Sports Internet Group Shareholders and BSkyB will cease to be bound by forms of acceptance submitted before the time when the Offer lapses. The Offer shall lapse unless the conditions set out above (other than condition (a) to the Offer) are fulfilled or (if capable of waiver) waived or, where appropriate, have been determined by BSkyB in its reasonable opinion to be or remain satisfied no later than 21 days after the first closing date of the Offer or after the date on which the Offer becomes or is declared unconditional as to acceptances, whichever is the later. If the Offer so lapses the Offer will cease to be capable of further acceptance and accepting Sports Internet Group Shareholders and BSkyB will cease to be bound by forms of acceptance submitted before the time the Offer lapses. FURTHER TERMS OF THE OFFER The Offer will be made on, inter alia, the following terms: (a) The Offer will extend to all Sports Internet Group Shares unconditionally allotted or issued on the date on which the Offer is made and any further Sports Internet Group Shares unconditionally allotted or issued while the Offer remains open for acceptance (or such earlier date or dates as BSkyB may decide). (b) The New BSkyB Shares to be issued under the Offer will be issued credited as fully paid and will rank pari passu in all respects with the existing issued BSkyB Shares, including the right to receive in full all dividends and other distributions, if any, declared, made or paid after the date hereof. (c) The Sports Internet Group Shares are to be acquired by BSkyB fully paid and free from all liens, charges and encumbrances, rights of pre-emption and any other third party rights of any nature whatsoever and together with all rights attaching thereto, including the right to all dividends or other distributions declared, paid or made after the date hereof. (d) Fractions of New BSkyB Shares will not be allotted or issued to accepting Sports Internet Group Shareholders. Fractional entitlements to New BSkyB Shares will be aggregated and sold in the market and the net proceeds of sale distributed pro rata to the Sports Internet Group Shareholders entitled thereto, save that individual entitlements to amounts of less than £3.00 will be retained for the benefit of the Enlarged Group. APPENDIX II Financial and Other Information on the Offer 1. Bases and Sources (i) Unless otherwise stated, financial information concerning BSkyB and Sports Internet Group has been derived from the published annual report and accounts and interim statements of the relevant company for the relevant periods. (ii) The value of the Offer is based on approximately 35.5 million Sports Internet Group Shares in issue. References to the exercise of all rights and options outstanding are based on the foregoing number of issued Sports Internet Group Shares and to 1.5 million Sports Internet Group Shares under option pursuant to the Sports Internet Group Share Option Schemes, and 1.8 million Sports Internet Group Shares to be issued on completion of the agreement dated 7 February 2000 between Sports Internet Group and Hay & Robertson plc. It is also assumed that BSkyB completes the purchase of the Freeserve warrant referred to in section 9 of the attached press release for the issue of approximately 0.03m new BSkyB Shares based upon the Closing Middle Market price of a BSkyB Share of 1512p at the close of business on 9 May 2000, the last business day prior to the date of this announcement. (iii)The Closing Middle Market Prices of Sports Internet Group Shares and BSkyB Shares are derived from the London Stock Exchange Daily Official List for the relevant date. 2. Financial Effects of Acceptance On the bases and assumptions set out in the notes below, for illustrative purposes only and assuming the Offer becomes or is declared unconditional in all respects, the following tables show the effects on capital value for a holder of one Sports Internet Group Share who accepts the Offer. Offer(p) Capital value Market value of 0.5622 New BSkyB Shares (1) 850.0 Market value of one Sports Internet Group Share (2) 772.5 ----- Increase in capital value 77.5 This represents an increase of approximately 10.0 % Notes: (1) The market value of New BSkyB Shares is based on the Closing Middle Market Price of a BSkyB Share of 1512p at the close of business on 9 May 2000, the last business day prior to the date of this announcement. (2) The market value of Sports Internet Group Shares is based on the Closing Middle Market Price of a Sports Internet Group Share of 772.5p at the close of business on 9 May 2000, the last business day prior to the date of this announcement. (3) No account has been taken of any liability to taxation or the treatment of fractions under the APPENDIX III DEFINITIONS The following definitions apply throughout this announcement unless the context requires otherwise: 'BSkyB' or the 'Company' British Sky Broadcasting Group plc 'BSkyB Group' BSkyB and its subsidiary and associated undertakings and, where the context admits, each of them 'BSkyB Shares' Ordinary shares of 50p each in BSkyB 'City Code' The City Code on Takeovers and Mergers 'Closing Middle Market The closing middle market Price' prices for the relevant shares as derived from the Daily Official List of the London Stock Exchange 'Enlarged Group' The BSkyB Group as enlarged by the acquisition of the SIG Group 'Goldman Sachs Goldman Sachs International of International' Peterborough Court, 133 Fleet Street, London, EC4A 2BB 'London Stock Exchange' London Stock Exchange Limited 'New BSkyB Shares' The new BSkyB Shares to be issued, credited as fully paid, pursuant to the Offer 'Offer' The recommended Offer to be made by Goldman Sachs International on behalf of BSkyB to acquire all of the issued and to be issued Sports Internet Group Shares, including where the context permits, any subsequent revision, variation, extension or renewal of such Offer 'Offer Document' The document to be posted to Sports Internet Group Shareholders containing the Offer 'Official List' The list maintained by the UK Listing Authority pursuant to Part IV of the Financial Services Act 1986 'Panel' The Panel on Takeovers and Mergers 'Sports Internet Group' Sports Internet Group plc 'SIG Group' Sports Internet Group and its subsidiary and associated undertakings and, where the context admits, each of them 'Sports Internet Group Ordinary shares of 10p each in Shares' Sports Internet Group 'Sports Internet Group Holders of Sports Internet Shareholders' Group Shares 'Sports Internet Group The Employee Share Option Share Option Schemes' Scheme Part B - Unapproved Options, the Subscription Option Agreement dated 1 March 1999 between (1) Sports Internet Group plc and (2) Rodger David Sargent and the Subscription Option Agreement dated 1 March 1999 between (1) Sports Internet Group plc and (2) Christopher Robin Akers 'UBS Warburg' UBS Warburg, a financial services group of UBS AG 'UK' The United Kingdom of Great Britain and Northern Ireland 'UK Listing Authority' The Financial Services Authority as the competent authority for listing in the United Kingdom 'United States' or 'US' The United States of America, its territories and possessions and the District of Columbia and all other areas subject to its jurisdiction

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