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Trace Group PLC (TCC)

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Thursday 17 May, 2007

Trace Group PLC

Offer Update

Trace Group PLC
17 May 2007


Trace Group plc

17 May 2007


          Update announcement regarding the recommended proposals for
         the acquisition of Trace Group plc ('Trace' or 'the Company')
                      by Tulip Holdings Limited ('Tulip')

On 11 May 2007, the Company announced that it had been approached by Microgen
plc ('Microgen') which indicated its interest in conducting a due diligence
exercise on Trace with a view to considering a possible offer for the Company.
Furthermore, the Company noted in this announcement that the earlier
announcement dated 11 May 2007 from Microgen ('the Microgen Announcement')
stated that it was considering a possible competing offer in cash for the share
capital of Trace at a price of not less than 150 pence per ordinary Trace share.

Since the Microgen Announcement, Tulip has issued two announcements (on 14 May
2007 and on 15 May 2007) relating to irrevocable commitments it had received to
accept its offer for Trace (at 135p per share in cash to be effected by way of a
scheme of arrangement pursuant to section 425 of the Companies Act 425 ('the
Tulip Offer')).

The independent directors of Trace (being, Mr. Daniel Chapchal, Professor David
Begg, Mr. Colin Clarke and Mr. Robin Woodall ('the Independent Directors')) have
sought from Tulip additional clarification in relation to all of the irrevocable
commitments received to accept the Tulip Offer. Pending receipt of such
clarification, it has been decided that it is in the best interests of Trace
shareholders that the Trace Court Meeting and Trace Extraordinary General
Meeting should be adjourned. The revised estimated timetable of principal events
is as follows:

Trace Court Meeting                            10.00 a.m. on 29 May 2007

Trace Extraordinary General Meeting            10.15 a.m. on 29 May 2007

First Court Hearing                                         15 June 2007

Second Court Hearing                                        19 June 2007

Effective Date of the Tulip Scheme                          20 June 2007

An update circular will be sent to all Trace shareholders as soon as practicable
setting out the dates for the Trace Court Meeting and the Trace Extraordinary
General Meeting and basis for the decision to adjourn the meetings and
summarising the additional information which the Independent Directors wish to
place before the Trace shareholders in the adjourned meetings. A further
announcement in relation to the validity of forms of proxy and forms of election
which have already been submitted by Trace shareholders will be made in due
course.

The adjournment of the meetings will allow the Independent Directors to clarify
the position in relation to all irrevocable commitments to accept the Tulip
Offer which have been gathered to date.

The Independent Directors (who are so advised by Shore Capital and Corporate
Limited) urge Trace shareholders to take no action in relation to the Tulip
Offer for the time being, pending a further update from the Company.

Enquiries:

Trace Group plc                       Telephone: +44 (0) 20 7825 1000
Daniel Chapchal                       Telephone: +44 (0) 7836 512 549
David Begg                            Telephone: +44 (0) 20 7825 1000

Shore Capital and Corporate Limited   Telephone: +44 (0) 20 7408 4090
(Financial adviser to Trace)
Alex Borrelli
Pascal Keane

Shore Capital, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Trace and no one else in
connection with the Tulip Proposals and will not be responsible to anyone other
than Trace for providing the protections afforded to clients of Shore Capital
nor for providing advice in relation to the Tulip Proposals, the content of this
announcement or any matter referred to herein.

Dealing disclosure requirements

Under the provisions of Rule 8.3 of the City Code on Takeovers and Mergers (the
'Code'), if any person is, or becomes, 'interested' (directly or indirectly) in
1 per cent. or more of any class of 'relevant securities' of Trace Group plc,
all 'dealings' in any 'relevant securities' of that company (including by means
of an option in respect of, or a derivative referenced to, any such 'relevant
securities') must be publicly disclosed by no later than 3.30 pm (London time)
on the London business day following the date of the relevant transaction. This
requirement will continue until the date on which any offer becomes, or is
declared, unconditional as to acceptances, lapses or is otherwise withdrawn or
on which the 'offer period' otherwise ends. If two or more persons act together
pursuant to an agreement or understanding, whether formal or informal, to
acquire an 'interest' in 'relevant securities' of Trace Group plc, they will be
deemed to be a single person for the purpose of Rule 8.3.

Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant
securities' of Trace Group plc by Trace Group plc or Tulip Holdings Limited, or
by any of their respective 'associates', must be disclosed by no later than
12.00 noon (London time) on the London business day following the date of the
relevant transaction. A disclosure table, giving details of the companies in
whose 'relevant securities' 'dealings' should be disclosed, and the number of
such securities in issue, can be found on the Takeover Panel's website at
www.thetakeoverpanel.org.uk

'Interests in securities' arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an 'interest' by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.

Terms in quotation marks are defined in the Code, which can also be found on the
Panel's website. If you are in any doubt as to whether or not you are required
to disclose a 'dealing' under Rule 8, you should consult the Panel.


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