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ISA International (ISA)

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Friday 10 August, 2001

ISA International

Re Alliance

ISA International PLC
10 August 2001

                    ISA INTERNATIONAL PLC
                  ('ISA' OR THE 'COMPANY')

        Agreement of Strategic Alliance with Daisytek


* The  board  of  ISA, the international distributor  of
  electronic office supplies, announces that it has  reached
  agreement on the terms of a Strategic Alliance with Daisytek
  International   Corporation  ('Daisytek'),   a   wholesale
  distributor of computer and office supplies and provider of
  marketing and demand generation services based in the US.

* Daisytek will, subject to approval by Shareholders,
  invest up to £10.0 million in ISA - £8.0 million in
  Convertible Preference Shares with a Warrant to invest a
  further £2.0 million at Daisytek's discretion.

* The Strategic Alliance with Daisytek will address both
  the financial needs of ISA and its requirement to have
  strong global partnerships with vendors and to service
  global customers.

* The terms of the Strategic Alliance are such that the
  Board has concluded that, if the Proposals are implemented,
  the Company cannot maintain its Listing and therefore, if
  the Investment by Daisytek is completed, the Ordinary Shares
  will be de-listed from the Official List and the Company
  will make application for the admission of the Ordinary
  Shares to trading on AIM.

* The Convertible Preference Shares will mature on the
  fifth anniversary of their issue and are convertible at any
  time during their 5 year term at the option of Daisytek into
  Ordinary Shares representing 50 per cent. plus one share of
  the Company's issued share capital as enlarged by the
  conversion, subject to dilution by the exercise of certain
  share options.   The Takeover Panel has agreed, subject to
  the Resolution being passed on a poll by ISA Shareholders,
  to waive the requirement for Daisytek to make a general
  offer to Shareholders under Rule 9 of the City Code.  The
  conversion is equivalent to a subscription price of
  approximately 13 pence per Ordinary Share.

* In addition to its Investment, the Board of Daisytek
  has indicated that it may be willing to advance up to £5
  million of credit facilities to ISA for investment purposes,
  subject to negotiation and execution of a legally binding
  agreement on commercial arm's length terms.

* Shareholder approval is also sought to allow the Board
  to amend the terms of Existing Share Option Schemes, the
  performance targets of which are considered to no longer
  provide a meaningful incentive, and to allow the grant of
  new options to the senior management of ISA.

* ISA  has received irrevocable undertakings to vote  in
  favour  of  the Resolution from Shareholders  holding,  in
  aggregate,  approximately 51.1 per  cent.  of  the  issued
  ordinary share capital of ISA.
  
David Heap, Chairman, commented: 'I am delighted to announce
this  alliance  with Daisytek which will  bring  significant
strategic  benefits to the Group.  Daisytek's  complementary
skills  and  international  presence  will  assist  ISA   in
building   strong  global  partnerships  with  vendors   and
servicing global customers.'

                                                        
Enquiries:

ISA International Plc                          01274 306 787
Mike Murphy, Chief Financial Officer

KPMG Corporate Finance                         0121 232 3000
Maura Dunne

Square Mile BSMG Worldwide                     020 7601 1000
Louise Robson / Susanne Walker




Introduction

On  30 April 2001, ISA announced that it had signed Heads of
Agreement  with  a strategic, global trade partner  who  was
proposing to make a cash investment of up to £10 million  in
ISA.   The Board announces that it has reached agreement  on
the   terms   of   a   Strategic  Alliance   with   Daisytek
International   Corporation,  a  wholesale  distributor   of
computer  and office supplies and provider of marketing  and
demand generation services based in the US.

The  Strategic Alliance with Daisytek will address both  the
financial  needs of ISA and its requirement to  have  strong
global  partnerships  with vendors  and  to  service  global
customers.

The  terms of the Strategic Alliance are such that the Board
has  concluded  that, if the Proposals are implemented,  the
Company  cannot maintain its Listing and therefore,  if  the
Investment  by  Daisytek is completed, the  Ordinary  Shares
will  be  de-listed from the Official List and  the  Company
will  make  application for the admission  of  the  Ordinary
Shares to trading on AIM.

Background to and reasons for the Investment

As  outlined in the Company's Annual Report and Accounts for
the  year ended 31 December 2000 adopted by Shareholders  at
the  Annual General Meeting on 26 June 2001, 2000 was a year
of contrasting financial performance for ISA: record profits
in  the  UK  and  Ireland were offset by significant  losses
incurred  in  Continental  Europe. The  European  outsourced
logistics partner, who commenced operations in October 1999,
failed  to  attain customer service performance or financial
controls  satisfactory  to ISA. The contract  was  therefore
terminated   in  September  2000  and  logistics   was   re-
established  as an ISA core competence in both  Germany  and
France.  The consequential impact of the European  logistics
failure was that Group turnover only grew by 3 per cent.  to
£296.8  million (1999 continuing operations: £288.0 million)
whilst  operating losses, excluding non-recurring costs  and
before  share  of associates, of £0.6 million were  recorded
(1999 continuing operations: £2.2 million operating profit).
One-off   costs  directly  attributable  to  the  outsourced
European logistics contract amounted to £7.2 million  (total
non-recurring items: £7.7 million).

The  impact  of  the non-recurring losses arising  from  the
problems of the outsourced logistics in Europe has increased
the  net  debt of the Group by £3.5 million to £25.8 million
at  31  December 2000. Shareholders' funds reduced to  £12.7
million  giving net gearing of 203 per cent.  Net  debt  has
increased  significantly since year end due to an uplift  in
the level of business combined with seasonal working capital
requirements.   The  Board sought  an  equity  injection  to
improve  the  Group's balance sheet and  to  enable  ISA  to
continue to grow and seize commercial opportunities  as  and
when they arise. After detailed consideration of a number of
alternatives, the Board has reached agreement with Daisytek,
subject  to  Shareholder approval, on the terms of  an  £8.0
million investment in ISA with a Warrant to invest a further
£2.0 million at Daisytek's discretion.

Whilst the total possible investment by Daisytek is the same
as that announced in the preliminary announcement of results
on  30 April 2001, it has been necessary to change the terms
on  which the Investment is to be made, details of which are
set out below.

Information on Daisytek

Daisytek  is a wholesale distributor of computer and  office
supplies  and  professional tape products,  in  addition  to
providing   marketing   and  demand   generation   services.
Daisytek sells its products and services in the US,  Canada,
Australia,  Mexico and South America.  Daisytek  distributes
more  than  17,000 name-brand computer and  office  supplies
products  and  over  2,800 professional tape  products  from
numerous manufacturers. Daisytek is headquartered in  Allen,
Texas  and  is quoted on NASDAQ with a market capitalisation
of US$236.5 million at 31 July 2001.

Rationale for the Strategic Alliance

ISA   is  a  distributor,  primarily  of  electronic  office
supplies,  servicing direct, wholesale and retail  channels.
The   ISA   Directors  believe  that  large   multi-national
corporations are seeking to derive the benefits provided  by
global  supply arrangements.  This trend is well established
within the office supplies market.

Daisytek's strategy is to become a leading, global wholesale
distributor   of   information   technology   supplies   and
consumables,  office supplies and products  and  aftermarket
microcomputer  peripherals  and  accessories.   Daisytek  is
striving  to develop global relationships with its customers
and  with  the  key  product  manufacturers  with  which  it
partners.

The  Strategic Alliance with ISA enables Daisytek to  extend
its  presence  into  the United Kingdom  and  Europe,  which
represents one of the largest and most important markets  in
which Daisytek does not currently do business.

The  Strategic Alliance is intended to benefit both ISA  and
Daisytek  by  realising strategic benefits in  five  primary
areas:   vendor   relationships,   customer   relationships,
information  technology  development,  global  sourcing  and
employee development.  Both companies seek to develop global
relationships  with  their  key  vendors.   In  addition  to
realising   the   combined   product   management,   product
purchasing and vendor programme benefits from Daisytek's and
ISA's   common  vendors,  Daisytek  and  ISA   believe   the
opportunity  to  develop  customised  programmes   to   help
implement   the  vendors'  global  strategies  may   provide
substantial long-term opportunities for both companies.  ISA
and  Daisytek are building businesses with an intense  focus
on  customer  service  delivery.  The  capacity  to  service
customers globally and to share best practices and  best-in-
class technology tools of both organisations to continuously
enhance  customers  satisfaction  levels,  is  an  important
objective of the Strategic Alliance.  In addition,  ISA  and
Daisytek  intend  to encourage the exchange  of  experienced
employees,  not  only to facilitate the realisation  of  the
benefits  of  the Strategic Alliance, but also to  challenge
and develop each company's most talented individuals.

The  net  proceeds of the Investment, estimated to  be  £7.0
million  net  of  expenses, will be  used  to  reduce  ISA's
indebtedness.   A pro forma statement of net assets  it  set
out in the Circular.

Principal terms of the Strategic Alliance

The  Strategic  Alliance  provides for  Daisytek  to  invest
£8,000,000  in Convertible Preference Shares  in  ISA.   The
Convertible  Preference  Shares will  mature  on  the  fifth
anniversary of their issue and are convertible at  any  time
during  their five year term at the option of Daisytek  into
ordinary  shares of ISA representing 50 per cent.  plus  one
share  of the Company's issued share capital as enlarged  by
the conversion of the Convertible Preference Shares, subject
to  dilution  by certain share options which may  have  been
exercised  as described below.  The conversion is equivalent
to  a subscription price per Ordinary Share of approximately
13  pence, compared with approximately 16 pence envisaged at
the time of the announcement on 30 April 2001.

ISA presently has a total of 7,658,519 Ordinary Shares under
option under the Existing Share Option Schemes.  It has been
agreed   that   Daisytek  will  not  have   its   percentage
shareholding, either on or following conversion, reduced  by
the  exercise  of 3,794,519 of these share  options  and  on
exercise of these options after conversion, Daisytek will be
entitled to receive an equal number of ISA Shares by way  of
bonus issue.  Daisytek's percentage shareholding, either  on
or  following conversion, will be reduced by the exercise of
all  other  share options granted with Daisytek's agreement,
including  those described below in the section headed  'New
Option Grants'.

Following amendment of the Existing Share Option Schemes  in
accordance with the Proposals, ISA may grant under option  a
maximum  of  20 per cent. of its issued share  capital  from
time  to  time.   Upon  the Resolution  being  approved  and
becoming  unconditional, ISA will have  authority  to  grant
18,794,826   Ordinary   Shares   under   option.    Assuming
conversion of the Convertible Preference Shares,  ISA  could
grant  a  further  4,716,533 Ordinary Shares  under  option,
which  if  granted without the agreement of Daisytek,  would
enable Daisytek to receive, on exercise of these options, an
equal  number  of  Ordinary Shares by way  of  bonus  issue.
Daisytek  could  therefore receive a  maximum  of  8,511,052
Ordinary  Shares  by way of bonus issue  (inclusive  of  the
3,794,519 bonus shares referred to above) under the terms of
the Proposals.

On   completion   of  the  Subscription  and   Shareholders'
Agreement,  ISA  will  issue a deed of warrant  to  Daisytek
under which Daisytek may, at its option, subscribe for up to
15,384,615  Ordinary  Shares for an  aggregate  subscription
price  of  £2,000,000, equivalent to 13 pence  per  Ordinary
Share.

The  Convertible  Preference Shares carry a variable  annual
coupon of 3 per cent. over 3 month LIBOR, payable quarterly,
and  can  be redeemed early at the option of ISA  after  the
third year on payment of a 10 per cent redemption premium.

Daisytek  has confirmed that, if it converts the Convertible
Preference Shares into ISA Shares, its current intention  is
that  the  business  of  the Group  would  be  continued  in
substantially  the  same  manner as  at  present  under  the
control  of the ISA Directors and that the existing  rights,
including pension rights, of employees of the Group will  be
fully safeguarded.

In  addition  to its Investment, the Board of  Daisytek  has
indicated that it may be willing to advance up to £5 million
of credit facilities to ISA for investment purposes, subject
to  negotiation and execution of a legally binding agreement
on commercial arm's length terms.

ISA  and  Daisytek  have  entered into  a  Subscription  and
Shareholders' Agreement which supplements the terms  of  the
Convertible  Preference Shares and under which, inter  alia,
Daisytek   has   the  right  to  appoint  two  non-executive
directors to the board of ISA (although it is not Daisytek's
current intention to do so).  ISA has taken out policies  of
insurance  in  relation to the warranties  and  undertakings
given   by   ISA   in  the  Subscription  and  Shareholders'
Agreement.   Further details of the terms of the Convertible
Preference   Shares,  the  Warrant,  the  Subscription   and
Shareholders'  Agreement,  the Insurance  Policies  and  the
Proposed Line of Credit are set out in the Circular.
Dispensation from Rule 9 of the City Code

Under  Rule  9  of  the City Code, any person  who  acquires
shares which (taken together with any shares already held or
acquired by that person or by persons acting in concert with
him) amount to 30 per cent. or more of the voting rights  of
a  company  to  which  the City Code  applies,  is  normally
required to make a general offer to the shareholders of that
company to acquire their shares at the highest price paid by
that  person  or any person acting in concert  with  such  a
person within the preceding 12 months.

If the Proposals become unconditional and Daisytek elects to
convert  the  Convertible Preference  Shares  into  New  ISA
Shares,  the resulting ordinary shareholding of Daisytek  in
ISA  would,  ignoring the exercise of certain share  options
detailed above, represent 50 per cent. plus one share of the
enlarged issued ordinary share capital of ISA.  Further,  if
ISA  is  in  default  under  the terms  of  the  Convertible
Preference Shares, Daisytek will be entitled to vote 50  per
cent.  plus  one share of the votes cast at any  shareholder
meeting  of ISA.  If Daisytek also exercises its  option  to
convert  the  Warrant,  it  will receive,  in  aggregate,  a
further  15,384,615  New  ISA Shares  giving  it  a  maximum
ordinary  shareholding in ISA, assuming  conversion  of  the
Convertible  Preference  Shares  and  that  no  options  are
exercised,  of 55.8 per cent. of the enlarged  issued  share
capital  of  ISA.  However, the Takeover Panel  has  agreed,
subject  to the Resolution set out in the notice of  EGM  in
the Circular being passed on a poll by ISA Shareholders,  to
waive  the requirement for Daisytek to make a general  offer
to Shareholders under Rule 9 of the City Code.

This  waiver  is in respect of the issue of the  Convertible
Preference  Shares, any holding of New ISA Shares  resulting
from  the  conversion of Convertible Preference Shares  into
ISA  Shares,  the  exercise of the Warrant  to  acquire  ISA
Shares and if Daisytek is entitled to exercise its rights to
vote  more than 50 per cent. of the votes which may be  cast
at  any shareholder meeting of ISA on the occurrence  of  an
Event  of  Default of the Convertible Preference Shares  (as
defined  in  the  Articles  to  be  amended  at  the   EGM).
Following  the  Proposals becoming unconditional,  prior  to
exercise of its rights to convert the Convertible Preference
Shares into New ISA Shares, Daisytek will be free to acquire
additional shares in ISA (whether by exercise of the Warrant
or otherwise), subject to the provisions of the City Code.

Assuming  that Daisytek converts the Convertible  Preference
Shares and exercises such proportion of the Warrant into New
ISA Shares as is necessary so that it holds in excess of  50
per  cent. of the enlarged issued ordinary share capital  of
ISA  (as  is  envisaged  by  these Proposals),  Shareholders
should  note  that Daisytek would then be  able  to  further
increase its shareholding in the Company (either by exercise
of  the  Warrant  if this is not done at the  same  time  as
conversion   of   the  Convertible  Preference   Shares   or
otherwise) without incurring any further obligation to  make
a  general  offer to Shareholders under Rule 9 of  the  City
Code.

New Option Grants

Following  shareholder approval in June 2000,  options  were
granted  under  the Unapproved Share Option Scheme  and  the
Approved  Share Option Scheme.  The exercise of  these  were
made subject to challenging performance targets relating  to
growth in earnings per share.  The Board believes that these
targets   and   the   fact  that  the  exercise   price   is
significantly  higher than the current share  price  of  ISA
means  that  these  options no longer provide  a  meaningful
incentive  for  future  performance,  particularly   for   a
management  team  which has been appointed  to  restore  the
Group's  performance.   The rules of  the  Unapproved  Share
Option  Scheme  and  the Approved Share Option  Scheme  only
allow   limited  revision  to  these  targets.  Consequently
shareholder approval is being sought to allow the Board more
flexibility  in  setting  conditions  on  the  exercise   of
options,    which   nonetheless   will   require   sustained
improvement in the underlying financial performance  of  the
Group.

Currently, there are outstanding options over 7,658,519  ISA
Shares granted under the Existing Share Option Schemes.   It
is  the  Board's intention to seek the surrender of  options
over  3,864,000 ISA Shares, which will require the  approval
of  the option holder in each case.  Bruce Robinson and Mike
Murphy,  Chief Executive Officer and Chief Financial Officer
of  ISA respectively, intend to surrender all options  which
they currently hold, amounting to options over 1,750,000 ISA
Shares, and the Board will invite senior managers within the
Group to do the same.

Conditional on the passing of the Resolution, it is proposed
to  grant  new  options  over a maximum  of  15,000,307  ISA
Shares.  Of this number, options over a maximum of 3,864,000
ISA  Shares  will replace options which are surrendered  and
options over a maximum of 3,702,500 ISA Shares will  be  new
options.   The balance, representing options over a  maximum
of  7,433,807  ISA  Shares,  will  only  be  exercisable  if
Daisytek elects to convert the Convertible Preference Shares
into  New ISA Shares.  The exercise of all new options  will
be  subject to the achievement of performance conditions set
by the Board.  To the extent these options are granted under
the  Unapproved  Share Option Scheme, they will  be  granted
with  an  exercise  price of 13 pence per ISA  Share,  which
equates  to  a  subscription price  per  Ordinary  Share  on
conversion   of   the  Convertible  Preference   Shares   of
approximately 13 pence and is also the price per  ISA  Share
at  which  Daisytek may exercise the Warrant.  Depending  on
the  market  value of the Company's shares at  the  date  of
grant,  this  price  may  be below  market  value.   Options
granted under the Approved Share Option Scheme will have  an
exercise  price equal to the market value of ISA  Shares  at
the date of grant.

Daisytek  has been impressed by the efforts of  the  present
management  in  difficult  circumstances  over  a  long  and
sometimes  arduous period. Daisytek views with optimism  the
ability  of the existing management to manage the future  of
ISA and strongly believes that the proper incentivisation of
management   is  critical  to  the  delivery  of   long-term
shareholder  value. As a result Daisytek fully supports  the
proposed  amendments to the Unapproved Share  Option  Scheme
and  the  Approved Share Option Scheme as set  out  in  this
Announcement and in the Circular.

The  proposed grant of new options requires amendment to the
rules of the Unapproved Share Option Scheme and the Approved
Share Option Scheme and consequential amendment to the rules
of  the  ISA International plc Savings Related Share  Option
Scheme  and  the  ISA  International  plc  Overseas  Savings
Related  Share  Option Scheme.  These are explained  in  the
Circular.

Dilution impact for existing Shareholders

If  Daisytek converts the Convertible Preference Shares into
New  ISA  Shares  and exercises its option  to  convert  the
Warrant and if the maximum number of options over ISA Shares
following the Proposals are exercised (totalling 18,794,826,
being  existing options not being surrendered  of  3,794,519
and  new  options  being  granted of  15,000,307),  existing
Shareholders will hold 37.8 per cent. of the enlarged issued
share capital of ISA.

Amendments to Articles of Association

The  Articles of Association are proposed to be  amended  to
insert  the  rights  relating to the Convertible  Preference
Shares  and certain consequential amendments as set  out  in
the Circular.  The Articles of Association as proposed to be
amended will be available for inspection as set out  in  the
Circular.

Current trading, prospects and working capital

As noted in the Company's Annual Report and Accounts adopted
by  Shareholders at the Annual General Meeting  on  26  June
2001, the Group returned to an operating profit in the first
quarter of 2001, with record profits being achieved  in  the
UK and Ireland, Sweden and Norway producing good profits and
losses declining in Germany and France.

Volumes  are currently showing good growth, although margins
have  not been as strong, partly due to the cash constraints
under  which  the  Group  has  been  operating.   The  Board
considers  that  considerable  progress  has  been  made  in
driving  the European businesses back towards profitability,
although the margin recovery in Europe has been slower  than
planned.  Trading is also affected by seasonal trends,  with
volumes  normally lower in the second and third  quarter  in
Continental  Europe.  The Group expects  to  experience  its
normal  increased levels of demand in the final  quarter  of
the year.

ISA's associate Kaye is moving forward with the second stage
of  its  strategic plan which should result  in  significant
improvements in its distribution network, but which requires
investment  in  higher fixed costs during  the  transitional
period.  Revenue is expected to be close to target  for  the
first  six  months of the current year although margins  are
weaker   than  expected.  The  continuing  Kaye   investment
programme requires a refinancing of Kaye to ensure that  the
benefits  of the investment programme, and the consequential
impact  on shareholder value, are maximised.  ISA's decision
to participate in the Kaye refinancing, which is expected to
take  place in the next few weeks, will depend on  the  size
and  the terms of the refinancing and on its ability to fund
participation   at  that  time.   ISA's  ability   to   fund
participation in the Kaye refinancing will be influenced by,
and  may be dependent on, satisfactory finalisation  of  the
Proposed  Line of Credit from Daisytek of up to £5  million.
The  Board has assumed that ISA's participation in the  Kaye
refinancing  will require additional financial resources  to
be made available to ISA over and above the Investment.

Net  debt has increased significantly from the £25.8 million
reported at 31 December 2000 due to the uplift in the  level
of business combined with the usual seasonal working capital
requirements  described above.  Increased  interest  charges
resulting  from  the higher levels of debt  are  also  being
incurred.   In  the  opinion of the Directors,  taking  into
account  the  net  proceeds of the Investment,  the  Group's
existing  cash resources and available bank facilities,  the
Group   has  sufficient  working  capital  for  its  present
requirements, that is for at least the next 12  months  from
the  date of this Announcement.  Without the benefit of  the
Investment, however, the Group's borrowing requirements  are
likely  to  exceed available facilities for the majority  of
the next year.

In  the  event  that  the  Resolution  is  not  approved  by
Shareholders  at  the  EGM, the  ability  of  the  Group  to
continue  trading would be severely jeopardised.  The  Group
would  need to negotiate immediate additional debt or  other
financing  facilities.  If these additional facilities  were
not  forthcoming,  the  Group would  have  to  pursue  other
alternatives, such as disposal of all or part of  the  Group
and  significant rationalisation of its business  operations
which,  if unsuccessful, could result in the Company ceasing
to trade.

Subject  to receipt of the Investment, the Directors believe
that  ISA  is  well  placed  to capitalise  on  the  growing
electronic   office  supplies  market  and  the   continuing
recovery of the Group's Continental European businesses. The
Group  aims to achieve an attractive return on sales in  the
medium  term  and  the  Board expects that  the  Group  will
benefit  from the proceeds of the Investment by the  ability
to pursue additional commercial opportunities.

Proposed  cancellation of the Listing  and  application  for
admission to trading on AIM

The  Board  has examined a number of alternative sources  of
finance for the Group and believes that the Proposals agreed
with  Daisytek are in the best interests of the Company  and
its  Shareholders. The terms of the Investment  by  Daisytek
contain provisions which, whilst required by Daisytek  as  a
precondition   of   investing  in  ISA,  would   breach   or
potentially breach certain of the provisions of the  Listing
Rules.  The  most  notable of these  breaches  would  be  as
follows:

* Listing  Rule  3.6 requires ISA to be an 'independent'
  company.  Certain  of  the  restrictions  which  would  be
  exercisable  by Daisytek as the holder of the  Convertible
  Preference Shares (which are described in the Circular) are
  of a nature such that the Board is concerned that it could
  not  be regarded as acting independently from Daisytek for
  the purpose of this Listing Rule;
  
* Daisytek on conversion of the Convertible Preference
  Shares would be a 'controlling shareholder' of ISA for the
  purposes of Rule 3.13 of Listing Rules;

* Conversion of the Convertible Preference Shares and
  exercise of the Warrant would be likely to result in a
  breach of the requirement of Listing Rule 3.18 that,
  generally, 25 per cent. or more of the listed share capital
  of the Company must be in public hands;

* The issue of the Warrant would breach Listing Rule 3.23
  which provides that the issue of warrants or options must be
  limited to not more than 20 per cent. of the issued equity
  share capital of the Company.

The  Board  also  believes that the costs of  maintaining  a
Listing and the heavy burden of regulation to which a listed
company  is subject now outweigh the benefit to the  Company
of  a  Listing,  having  regard  to  the  Company's  present
financial  position and market capitalisation. However,  the
Board  believes  that  it  is  in  the  best  interests   of
Shareholders  for there to be a continued market  for  their
ISA  Shares  and  for these reasons the Board  has  decided,
subject  to  the Proposals being implemented, to cancel  the
Company's  Listing and to make application for the Company's
Ordinary  Shares to be admitted to trading on AIM.   If  the
Proposals  are  not  approved  at  the  EGM,  or   are   not
implemented for any other reason, then the Group will retain
its Listing.

Shareholders   should  note  that  if  the   Proposals   are
implemented but admission to trading is refused by AIM,  the
Company's  Ordinary Shares would then not be traded  on  any
stock exchange or market.

The  admission of the Ordinary Shares to trading on AIM will
not  affect  the  way  in  which Shareholders  buy  or  sell
Ordinary   Shares.  However,  the  Board   is   aware   that
circumstances  which may apply to certain  Shareholders  may
prohibit  them  from  investing in AIM  traded  shares.  The
shares of a company quoted on AIM cannot be held in Personal
Equity   Plans   or   Individual  Savings   Accounts.   Such
Shareholders  are advised to review their position  in  this
respect as soon as possible.

If  the  Proposals  are implemented,  the  Listing  will  be
cancelled  on  10  September 2001. It is expected  that  the
entire issued Ordinary Share capital of the Company will  be
admitted to trading on AIM on 10 September 2001.

Extraordinary General Meeting

A  notice to Shareholders convening an Extraordinary General
Meeting  of the Company, to be held at the Company's offices
at  66/70 Vicar Lane, Bradford, West Yorkshire  BD1  5AG  at
9.00am  on  3  September 2001, is included in  the  Circular
which has been sent to Shareholders today.

In  addition to the conditions contained in the Subscription
and  Shareholders' Agreement summarised in the Circular, the
Proposals  are conditional upon the approval by Shareholders
of the Resolution which provides for:

* the  granting  of  a  waiver from  the  obligation  of
  Daisytek to make a Rule 9 offer under the City Code;
  
* an increase in the authorised share capital of ISA;

* the granting of authority to the ISA Directors to allot
  the Convertible Preference Shares and to issue the Warrant
  to Daisytek and to make further issues of Ordinary Shares
  and/or Convertible Preference Shares as may be necessary to
  implement the mechanisms for conversion or redemption of the
  Convertible Preference Shares, and to do so without regard
  to pre-emption requirements and to capitalise the Company's
  reserves to pay up such shares;

* the amendment of the Articles of Association of ISA to
  insert the rights relating to the Convertible Preference
  Shares and certain consequential amendments;  and

* the amendment of the Unapproved Share Option Scheme and
  the Approved Share Option Scheme to revise the performance
  targets applicable to those schemes, to allow the grant of
  new options on the terms described above and consequential
  amendment to the rules of the ISA International plc Savings
  Related Share Option Scheme and the ISA International plc
  Overseas Savings Related Share Option Scheme.

General

Further information relating to the Strategic Alliance,  the
Proposals,  the Resolution and the proposed cancellation  of
Listing  and  application for admission to trading  on  AIM,
together  with a recommendation from the Board, is contained
in the Circular which will be sent to Shareholders today.

The  appendix to this Announcement contains the  definitions
of terms used in this Announcement.

The  ISA Directors accept responsibility for the information
contained  in this Announcement other than that relating  to
Daisytek,  the  Daisytek  Directors  and  members  of  their
immediate  families,  related trusts and  persons  connected
with   them   (for   which  the  Daisytek   Directors   take
responsibility in accordance with the paragraph below).   To
the  best  of the knowledge and belief of the ISA  Directors
(who  have taken all reasonable care to ensure that such  is
the case) the information contained in this Announcement for
which  they are responsible is in accordance with the  facts
and  does  not omit anything likely to affect the import  of
such information.

The   Daisytek  Directors  accept  responsibility  for   the
information  contained  in  this Announcement   relating  to
Daisytek,  the  directors of Daisytek and members  of  their
immediate  families,  related trusts and  persons  connected
with  them.  To the best of the knowledge and belief of  the
Daisytek  Directors (who have taken all reasonable  care  to
ensure  that such is the case) the information contained  in
this  Announcement  for  which they are  responsible  is  in
accordance with the facts and does not omit anything  likely
to affect the import of such information.

KPMG Corporate Finance is acting for ISA and no one else  in
connection with the Proposals and will not be responsible to
anyone other than ISA for providing the protections afforded
to clients of KPMG Corporate Finance or for providing advice
in  relation to the Proposals or in relation to the contents
of  this  Announcement  or  any transaction  or  arrangement
referred to herein.  KPMG Corporate Finance is a division of
KPMG  which  is  authorised by the  Institute  of  Chartered
Accountants  in  England and Wales to  carry  on  investment
business.

Enquiries:

ISA International Plc                          01274 306 787
Mike Murphy, Chief Financial Officer

KPMG Corporate Finance                         0121 232 3000
Maura Dunne

Square Mile BSMG Worldwide                     020 7601 1000
Louise Robson / Susanne Walker





                          APPENDIX
                              
                         DEFINITIONS
                              
The    following    definitions   apply   throughout    this
Announcement, unless the context otherwise requires:

'AIM'             Alternative  Investment Market  of  London
                  Stock Exchange
                  
'Announcement'    this  press  release issued today  on  the
                  Regulatory  News Service by the  board  of
                  ISA
                  
'Approved Share   The  ISA  International plc  1999  Company
Option Scheme'    Share Option Scheme
                  
'Articles of      the articles of association of ISA
Association'      

'Board',          the directors of ISA
'Directors' or    
'ISA Directors'

'Chisa'           Chisa,  LLC  a substantial shareholder  of
                  ISA
                  
'Circular'        the  circular  which  has  been  sent   to
                  Shareholders today which provides  details
                  of  the  Proposals and which  convenes  an
                  Extraordinary  General  Meeting  at  which
                  the   Shareholders  will   be   asked   to
                  consider  and  their approval  sought  for
                  the Proposals
                  
'City Code'       the City Code on Takeovers and Mergers
                  
'Convertible      the    80,000,000   new   variable    rate
Preference        convertible     cumulative      redeemable
Shares'           preference shares 2006 of 10p each in  the
                  capital  of  ISA  of which  8,000,000  are
                  proposed to be issued to Daisytek
                  
'Daisytek'        Daisytek   International  Corporation,   a
                  company  incorporated in the US, or  where
                  the  context admits the holder(s) for  the
                  time  being  of the Convertible Preference
                  Shares
                  
'Daisytek         the directors of Daisytek
Directors' or     
'Board of
Daisytek'

'Existing Share   together, The ISA International plc No.  4
Option Schemes'   Share     Option    Scheme,    The     ISA
                  International   plc  1999  Company   Share
                  Option  Scheme, The ISA International  plc
                  Unapproved  Share Option Scheme,  The  ISA
                  International  plc Savings  Related  Share
                  Option  Scheme  and The ISA  International
                  plc  Overseas Savings Related Share Option
                  Scheme
                  
'Extraordinary    the  extraordinary general meeting of  ISA
General Meeting'  convened  for 3 September 2001  (including
or 'EGM'          any  adjournment thereof), notice of which
                  is set out in the Circular
                  
'Insurance        the  policies of insurance to be purchased
Policies'         by  ISA  the terms of which are  described
                  in the Circular
                  
'Investment'      the    investment   in   the   Convertible
                  Preference  Shares to be made by  Daisytek
                  as  described in this Announcement and  in
                  the Circular
                  
'ISA' or          ISA International plc
'Company'         

'ISA Group' or    ISA     International    plc    and    its
'Group'           subsidiaries
                  
'ISA Shares' or   ordinary shares of 5p each in the  capital
'Ordinary Shares' of ISA
                  
'Kaye'            Kaye  Office Supplies Limited, a 47.1  per
                  cent. associate of ISA
                  
'LIBOR'           London Inter-Bank Offered Rate
                  
'Listing'         the  listing of the Ordinary Shares on the
                  Official List
                  
'Listing Rules'   the   listing  rules  of  the  UK  Listing
                  Authority
                  
'Mr Heap'         David  A  Heap, a director and substantial
                  shareholder of ISA
                  
'NASDAQ'          the  National  Association  of  Securities
                  Dealers Automated Quotation System in  the
                  US
                  
'New ISA Shares'  the  new  ISA  Shares which may  arise  on
                  conversion  of the Convertible  Preference
                  Shares and/or the exercise of the Warrant
                  
'Proposals'       the   Strategic  Alliance  and  the  other
                  proposals to which the Resolution  relates
                  as  described in this Announcement and  in
                  the Circular
                  
'Proposed Line of the   proposed   £5  million   of   credit
Credit'           facilities  which Daisytek  has  indicated
                  it  may  be willing to provide to  ISA  as
                  described in the Circular
                  
'Resolution'      the  resolution  to  be  proposed  at  the
                  Extraordinary    General    Meeting    and
                  described in this Announcement and in  the
                  Circular
                  
'Shareholders'    the holders of ISA Shares
                  
'Strategic        the   future   co-operation  and   trading
Alliance'         arrangements  proposed to  be  implemented
                  between  Daisytek and ISA, the Investment,
                  the  issue  by  ISA  to  Daisytek  of  the
                  Warrant  and  the  entering  into  of  the
                  Subscription  and Shareholders'  Agreement
                  as  described in this Announcement and  in
                  the Circular
                  
'Subscription and the  agreement between Daisytek,  ISA,  Mr
Shareholders'     Heap   and  Chisa,  dated  9  August  2001
Agreement'        relating   to   the   Strategic   Alliance
                  described in this Announcement and in  the
                  Circular
                  
'Takeover Panel'  the Panel on Takeovers and Mergers
                  
'Unapproved Share the  ISA International plc 1999 Unapproved
Option Scheme'    Share Option Scheme
                  
'UK Listing       the  Financial Services Authority  as  the
Authority'        competent  authority for  listing  in  the
                  United  Kingdom  under  Part  IV  of   the
                  Financial Services Act 1986
                  
'US'              United States of America
                  
'Warrant'         the  deed of warrant proposed to be issued
                  to  Daisytek  by  ISA  described  in  this
                  Announcement and in the Circular
                  

                                                  

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