MME Medal Ent&Med

RNS Number:4722Z
Avesco PLC
02 August 2002



                                                           2 August 2002


                                   AVESCO PLC

                PROPOSED DISPOSAL OF FOUNTAIN TELEVISION LIMITED

Avesco plc ("Avesco" or "the Company"), the provider of specialist services to
the corporate presentation, entertainment and broadcast markets, announces that
it has entered into a conditional agreement to dispose of Fountain Television
Limited ("Fountain"), a wholly-owned subsidiary of Avesco, to Medal Productions
Limited ("Medal Productions"), a wholly owned subsidiary of Medal Entertainment
& Media plc ("Medal"), for #7 million (subject to adjustment for adjusted net
current assets at completion) (the "Transaction").

The #7 million receivable by Avesco will be satisfied on completion of the
disposal of Fountain by Medal Productions paying, or procuring the repayment of,
approximately #5.3 million of debt owed by Fountain to the Avesco Group, by the
payment of approximately #0.2 million in cash by Medal Productions and by the
issue by Medal to the Avesco Group of 2,142,857 ordinary shares of Medal at 70
pence per ordinary share, representing a further #1.5 million of consideration,
together with 2,142,857 warrants, each warrant having the right to subscribe for
two ordinary Medal shares at 77 pence per ordinary share.



Fountain

Fountain operates the Fountain Studios in Wembley, London.  The studios are
hired out as fully equipped broadcast television studios to producers of
television programmes, in particular light entertainment shows. The Fountain
Studios have been the venue for, amongst others, the National Lottery Show "
Winning Lines" for Celador Productions (BBC), "Pop Idol" for Thames Television/
19 TV (ITV) and "The Kumars at No.42" for Hat Trick Productions (BBC).

Fountain reported profit on ordinary activities before taxation for the year
ended 31 March 2002 of #155,000 on turnover of #4.7 million. These profits are
stated after a net interest charge of #458,000 relating primarily to interest on
loans from the Avesco Group. The net liabilities of Fountain at 31 March 2002
were #580,000, including net loans owed to the Avesco Group of #7.0 million.
Prior to completion these loans will have been reduced to #5.3 million.


Medal

Medal was established in 2001 in order to build, primarily through acquisitions,
a group of companies engaged in the acquisition, creation and exploitation of
intellectual property rights in the media sector.

Richard Murray, a Director of Avesco is also a Director of Medal.  Richard
Murray at present holds 6.3 per cent. of the share capital of Avesco and 5 per
cent. of the share capital of Medal.  Following the completion of the proposed
disposal of Fountain, Richard Murray's holding in Medal will be diluted to less
than 1.2 per cent.



Background to the Disposal

Avesco's strategy is to focus on the development of its core services within the
events market. Fountain is a business operating solely within the broadcast
television sector, with limited synergy benefits between it and the rest of the
Avesco Group, and as such is considered by the Board to be a non-core activity.

One of Avesco's recent areas of focus has been on reducing debt during the
difficult trading conditions of the past year. The net proceeds of the proposed
disposal will be used principally further to reduce debt. Net debt of the Avesco
Group at 31 July 2002 was less than #16 million (before taking into account the
cash receivable from the proposed disposal of Fountain).



Completion

Medal today announced that it is undertaking a non underwritten placing of
4,857,857 ordinary shares at 70 pence per share to raise #3.4 million (before
expenses) (the "Placing") in connection with the Transaction.  Conditional
undertakings have been received by Medal from institutional and other investors
to subscribe for 4,857,857 Medal ordinary shares.

The proposed disposal of Fountain is conditional, inter alia, upon (i) the
approval of the shareholders of Avesco at an extraordinary general meeting, (ii)
a circular being posted by Medal to its shareholders, (iii) the approval of the
shareholders of Medal at an extraordinary general meeting of Medal and (iv) the
placing agreement (relating to the Placing) and the bank facilities agreement
relating to the balance of the funding required for Medal Productions to acquire
Fountain becoming unconditional and not having been terminated in accordance
with their terms. The Placing is conditional, inter alia, on the London Stock
Exchange agreeing to admit the share capital  of Medal to trading on the
Alternative Investment Market.

It is expected that a circular, accompanied by a form of proxy for use at the
Avesco extraordinary general meeting, setting out the details of the proposed
disposal and including a notice of the extraordinary general meeting, will be
posted to Avesco shareholders shortly.

On completion of the proposed disposal of Fountain, the Avesco Group will hold
23.4 per cent. of the ordinary share capital of Medal, and intends to realise
these securities in due course should the appropriate circumstances arise.
Avesco has agreed that any disposals of these securities will be made through
Medal's brokers, subject to certain conditions and time limits.

The completion of the proposed disposal of Fountain is expected to take place on
or about 30 August 2002.

Following the completion of the proposed disposal, Julian Kossick, a director of
Avesco and Fountain, will resign as a director of Avesco but will continue as
managing director of Fountain under Medal's ownership.


Current Trading and Prospects

Current trading in the remaining core services businesses has been broadly in
line with expectations, although the business environment in the UK and the USA
is still challenging.  The Board recognises that Avesco is operating in a period
of global economic uncertainty, where the recovery signs are fragile and where
it has limited visibility of future revenues.  The improvement in performance,
referred to in the Chairman's Statement in Avesco's Annual Report and Accounts
for the year ended 31 March 2002, continues to depend on the extent to which
confidence returns to the corporate sector.

The prospects for Complete Communications Corporation Limited remain as noted in
the Chairman's Statement in Avesco's last Annual Report and Accounts.  Revenues
in 2002/03 from television production licences and merchandising from "Who Wants
To Be A Millionaire?" are expected to be significantly reduced, although it
continues to be extremely difficult to predict such revenues accurately.


For further information please contact

David Nicholson, Chief Executive, Avesco plc           Tel: 020 8974 1234
David Brocksom, Finance Director, Avesco plc

Mark Edwards or Nicola Cronk,                          Tel: 020 7466 5000
Buchanan Communications






                      This information is provided by RNS
            The company news service from the London Stock Exchange

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