METRODOME GROUP PLC – Acquisition of Hollywood Classics

METRODOME GROUP PLC – Acquisition of Hollywood Classics

Metrodome plc today announced that it has acquired Hollywood Classics Limited, which markets and distributes the theatrical rights of classic films, for USD$2.6 million (£1.6 million) in cash, satisfied in part through a placing of New Ordinary Shares with both institutional and individual investors. HC represents theatrical and home video rights for classic films with a catalogue of some 600 'independent' films worldwide.

HC proudly represents the classic film libraries of Universal, Paramount, Twentieth Century Fox, Warner Bros. and the UK Film Council, including films such as Breakfast at Tiffany's, The Godfather and Psycho. It also distributes a growing number of studio classic films for the DVD market as well as a total library of over 700 films for television, DVD and VOD.

This strategic acquisition gives the Company access to major studios and vital international distribution networks. It should also create substantial cross-selling opportunities and potential for increased Group revenues.

In the full year to 2010 HC achieved annual revenues of £6.7 million and pre-tax profit of £510,000.

In conjunction with this acquisition, the Company has successfully raised £967,000 of new capital through the issue of 48,350,000 new ordinary shares at 2 pence each (the 'Placing'). The placees included Luke Johnson, best known for his involvement with Pizza Express, who will join the board with effect from 1 September 2011 as a non-executive director. In addition, £800,000 of Convertible Loan Notes have been converted into equity at a price of 2p per share - £400,000 from Metrodome BV (an investment vehicle controlled by Adrian Sarbu) and £400,000 from Mark Webster - resulting in the issue of a further 40,000,000 new ordinary shares. In addition, a further 7,500,000 shares have been issued at a price of 2p per share to satisfy fees due to Peter Urie (£125,000) and Steve Winetroube (£25,000).

As a result of the Group expanding, the management team of Metrodome will be further strengthened with Steve Winetroube moving from his role as a non-executive director to a full time role as chief operating officer for the Group. In addition, Peter Urie will move back into a full time role as chief executive officer of Hollywood Classics. Both appointments take place with immediate effect.

Application has been made for the shares issued in the Placing, on conversion of the Loan Notes and in satisfaction of fees to be admitted to trading on AIM and it is expected that their admission will become effective at 7.00 a.m. on 10 August 2011. Following admission the issued share capital of the Company will comprise 280,567,915 ordinary shares.

The Placing and the conversion of Loan Notes both strengthen the Company's balance sheet. The Company has also secured Euros €930,000 of additional loan facilities from its bankers, Coutts.

Mark Webster, Chairman of Metrodome, commented:
"This important acquisition is the next step in our mission to become one of the leading independent rights management groups in the UK providing independent producers and other intellectual property owners with a comprehensive solution for worldwide exploitation of their IP and content across all platforms. Hollywood Classics is an excellent company and one which offers revenue upsides through scale and an international reach. It is an excellent endorsement from the market that we were able to raise the entire consideration monies, which confirms investors belief in Metrodome's continued expansion and development. I am delighted to welcome Luke Johnson to the Board; Luke joins us with a huge amount of cross-sector experience which I am sure will prove invaluable in the next stage of our evolution.

As a result of this placing and acquisition, Metrodome will look to start paying a dividend in 2012."

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