Witwood’s production planning process used to be very dependent on the experience and knowledge of individual managers. Sanderson’s MRP module has allowed us to build this experience and knowledge into a “best practice” system that delivers consistent results every time. MRP is also giving a financial payback.

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Sanderson Announce First Acquisition Since AIM Flotation

Sanderson Group plc: £1.75million Acquisition

First acquisition since AIM Flotation in December 2004

Sanderson Group plc (‘Sanderson’), an established provider of software and IT services to UK commercial markets, today announces the acquisition of Progressive Computer Systems Limited (‘Progressive’), for a maximum consideration of £1.75million. This is the first acquisition by Sanderson since its flotation on AIM in December 2004.

Based in Batley, West Yorkshire, Progressive is a provider of browser-based software solutions, under the e-organiser brand, to mainly commercial organisations in the UK. Progressive, which is owned by Mr Robert Davison was founded in 1995, currently employs 22 people, and subsequent to the acquisition, Mr Davison will continue as Managing Director. The acquisition complements the position of Sanderson in its UK target markets and provides Progressive with the strength of the Sanderson brand to develop new business opportunities.

The total initial consideration for the acquisition is £750,000 in cash plus the issue of 375,000 ordinary shares of 10p nominal value each in the capital of Sanderson (the ‘consideration shares’). The consideration shares are valued at £245,625 based on the average closing mid market price of 65½p over the ten business days preceding 7th July 2005. The consideration shares will be subject to a twelve month period during which they may only be disposed of with the prior consent of Sanderson. An application has been made to the London Stock Exchange for the consideration shares to be admitted to AIM.

Up to £750,000 of additional cash consideration may be payable dependent upon the achievement of certain performance targets related to the results of Progressive for a period ending not later than 31st October 2007.
In the twelve months to 31 October 2004, Progressive achieved turnover of £1.37million (2003: £951,000) and earnings before interest and tax of £176,000 (2003: £6,000). It had gross assets of £549,000 at 31 October 2004. Sanderson expects the acquisition to be earnings enhancing in the financial year ending 30 September 2006, the first year in which Progressive will contribute a full year’s results.

Commenting on the acquisition, Christopher Winn, Chairman of Sanderson, said: ‘We are delighted to welcome Progressive to the Sanderson Group. As our first acquisition since flotation on AIM in December 2004, Progressive demonstrates our “Buy and Build” strategy, providing the Group with new revenue streams and market opportunities. We are confident that Progressive will provide a significant contribution to the Group in the years to come.’

Enquiries:
Sanderson – Christopher Winn, Chairman
024 7655 5466
Sanderson – Adrian Frost, Finance Director
024 7655 5466

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