Kuju PLC

Placing and Notice of EGM

Kuju PLC
09 March 2004

                                    Kuju plc

                           ("Kuju" or "the Company")


Placing of 7,272,727 new ordinary shares of 5p each at a price of 11p per share
                                  ("Placing")

Introduction

The Board of Kuju announces today proposals to raise approximately £800,000
(before expenses) by way of a placing of 7,272,727 new Ordinary Shares at a
price of 11p per Placing Share.

The Placing is conditional, inter alia, upon the Company obtaining approval from
its Shareholders to disapply statutory pre-emption rights and to grant the Board
authority to allot the Placing Shares.  The Placing, which has been arranged by
Nobles pursuant to the terms of the Engagement Letter, is also conditional upon
Admission.  The Placing has not been underwritten by Nobles.  The Placing
proceeds will be used to fund the working capital requirements of the Group and
further details are set out below.

As part of their continued commitment to the Company, each of the Executive
Directors and the Chairman has undertaken to participate in the Placing by way
of a subscription for, in aggregate, 1,036,363 Placing Shares (representing
14.25 per cent. of the new Ordinary Shares available in the Placing).

Background, Revised Strategy and Reasons for the Placing

In the announcement of the Interim Results, the Chairman of Kuju reported upon
the progress that the Group has made in implementing its revised business
strategy of moving towards a model whereby an increasingly significant
proportion of the development work will be outsourced or fulfilled by contract
staff.

This strategy has resulted in the creation of four distinct divisions focusing
on specific sectors of the interactive games market namely, action, racing,
wireless and new projects (Sheffield).  The first two divisions concentrate on
developing console and PC games and have a relatively small number of high value
contracts, while the latter two divisions have a higher number of games under
development with a lower value per game. Each division has a core team of
specialist permanent staff with contractors and outsourcers being engaged as
required.

The Directors believe that the best value for Shareholders will be obtained over
the medium term by demonstrating technological and production competencies in
the new console platforms emerging during that time, such as, the Sony PSP and
the PlayStation 3 generation of home consoles.  The Directors believe that the
transition to this new generation of consoles will accelerate the ongoing
consolidation in the games development market.

The Directors intend to use the proceeds of the Placing to provide additional
working capital for the Group to complete its current contracts and to enhance
its competitive position as it seeks to win contracts for the new generation of
platforms.

The Board believes that the Placing is in the best interests of the Group and
its Shareholders as a whole.  The Board further considers that, in light of the
associated costs and the Company's Shareholder profile, a placing of new
Ordinary Shares to a limited number of new and existing investors (rather than a
rights issue, open offer or other form of pre-emptive offering) is the most
appropriate method for the Company to raise equity finance at this time.

As such, the Directors believe that the proceeds of the Placing will enable the
Group to pursue further its revised business strategy as described above and in
the Interim Results.

Current Trading and Prospects

The Group has now completed its restructuring and trading is in line with the
Directors' expectations. As announced on 2 February 2004, THQ Inc. terminated
its development contract with the Group at the end of January.  However, the
Company has since received a termination payment and the successful move towards
the outsourcing model means the effect of this termination will not have a
significant effect on trading for the current financial year.  The Company is
also in advanced stages of negotiation in respect of a number of new development
agreements and these will be announced, if successful, in due course.  In
general, the Directors believe that market conditions in the Group's console
business are continuing to improve. Furthermore, the publishing of Kuju-owned
intellectual property by the Wireless division continues to grow strongly.

Details and Terms of the Placing

The Placing

The Company proposes to raise approximately £800,000 (before expenses) through
the allotment and issue of the Placing Shares at the Placing Price, which
represents a discount of 57.7 per cent. to the closing middle market price of
26p per Existing Share on 8 March 2004, being the last practicable date prior to
the announcement of the Placing.  The Placing Shares will represent 46.4 per
cent. of the Company's issued share capital immediately following Admission.

As part of their continued commitment to the Company, each of the Executive
Directors and the Chairman has undertaken to participate in the Placing by way
of a subscription for, in aggregate, 1,036,363 Placing Shares (representing
14.65 per cent. of the new Ordinary Shares available in the Placing).

The Engagement Letter

Pursuant to the terms of the Engagement Letter, Nobles has conditionally agreed
to use its reasonable endeavours to place the Placing Shares with certain
institutional and other investors.  The Placing has not been underwritten.  The
Engagement Letter is conditional upon, inter alia, Resolutions numbered 1 and 2
being duly passed at the EGM and Admission becoming effective on or before 8.00
a.m. on 7 April 2004 (or such later date as the Company and Nobles may agree,
but in any event no later than 30 April 2004).

Under the terms of the Engagement Letter, the Company has agreed to indemnify
Nobles in respect of certain liabilities it may incur in connection with the
Placing.  Subject to the Placing proceeding, the Company has agreed to pay
Nobles a fee of 4.0 per cent. on the value at the Placing Price of the Placing
Shares, excluding those Placing Shares subscribed to by the Executive Directors
and myself, together with any applicable value added tax.

Settlement and Dealings

Application will be made for the Placing Shares to be admitted to trading on the
Alternative Investment Market of the London Stock Exchange. It is expected that
such Admission will occur on 7 April 2004.

The Placing Shares will be issued, credited as fully paid, at 11p per share and
will rank pari passu in all respects with the Existing Shares, including the
right to receive dividends and other distributions declared following Admission.

Use of proceeds

The Directors intend that the net proceeds of the Placing of £750,000 will be
used to develop further its revised business strategy, provide additional
working capital for current contracts and to enhance its competitive position as
it seeks to win contracts for the new generation of platforms.

Recommendation

The Directors consider the Placing and the Resolutions to be in the best
interests of the Company and its Shareholders as a whole.

Accordingly, the Directors unanimously recommend Shareholders to vote in favour
of the Resolutions, as they have irrevocably undertaken to do so in respect of
their own beneficial holdings amounting to, in aggregate, 5,734,172 Existing
Shares, representing approximately 68.38 per cent. of the current issued share
capital of the Company.

An extraordinary general meeting of the Company will be held at the offices of
Osborne Clarke, Hillgate House, 26 Old Bailey, London, EC4M 7HW at 9.00 a.m. on
2 April 2004 at which the resolutions set out in the Notice of EGM will be
proposed in order to implement the Placing.

Copies of the circular to Shareholders, which includes the Notice of EGM, will
be posted to Shareholders today and are available from the Company's Nominated
Adviser and Broker, Noble & Company Limited, 76 George Street, Edinburgh, EH2
3BU, free of charge, for a period of one month.  Save where the context provides
otherwise, words and expressions where defined in the Circular shall have the
same meaning in this announcement.

Jonathan Newth, Managing Director of Kuju plc, commenting on the placing said;

"The board believes that with additional funds now secured the Group has
enhanced its position to exploit new opportunities, particularly with respect to
the emerging next generation of platforms.

The Group is in advanced stages of negotiations in respect of a number of new
development agreements and these will be announced, if successful in due
course."


For further information please contact:

Jonathan Newth, Kuju plc                                           01483 414 344
Ian Baverstock, Kuju plc                                           01483 414 344
Joe Philipsz, Noble & Company Limited                              0131 225 9677
Jeremy Garcia/James Strong, Buchanan Communications                020 7466 5000


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