SRV Sirvis

RNS Number:4562W
SiRViS IT PLC
11 May 2007


                   SiRViS IT plc ("SiRViS" or "the Company")

          Acquisition of Technology Management Group Limited ("TMG"),
                  Placing to raise approximately #538,000
                           and New Board Appointment


SiRViS IT plc, which provides a range of IT services including support,
consultancy and systems integration, is pleased to announce that it has today
acquired Technology Management Group Limited for up to #2.2m.

The Company has also today placed 17,933,755 ordinary shares of 1p each
("Ordinary Shares") at 3p each. These shares have been placed with institutional
investors, other than 1,833,333 which were subscribed for by the Board of SiRViS
as detailed below.  The new Ordinary Shares issued were placed by way of a
vendor placing ("the Placing").  Application has been made for the new Ordinary
Shares to be admitted to trading on AIM and it is expected that Admission will
be effective and dealings will commence on 17 May 2007.

Details on TMG

TMG which is based in Buckinghamshire, offers a range of contracted IT
infrastructure services and has a staff of 80.  In the year to 30 November 2006,
TMG achieved profit before tax of approximately #194,000 on turnover of #5.2m. 
TMG has recurring contracted revenues of approximately #3 million, a blue chip
customer base and at 30 November 2006 net assets of approximately #139,000. 
Completion of the acquisition ("Completion") took place earlier today.

The Directors believe that the acquisition will be earnings enhancing and will
have the added benefits of broadening the client base whilst reducing reliance
on third party software houses.

Terms of the acquisition

SiRViS will pay initial consideration of #1.25m, of which #184,108 was paid on
Completion and #517,912 will be paid from the proceeds of the Placing of which
amount #42,144 is to be retained and available to meet adjustments in the
purchase price as well as warranty and other claims.  Vendor loan notes having
an aggregate face value of #547,979 have also been issued of which #131,817 are
to be redeemed by the Company on 30 November 2008 and the balance redeemed by 13
monthly installments of #30,000 with a final payment of #26,162.  The first
monthly payment is due on 29 June 2007.

An additional #475,000 is payable in cash if contracted revenues are not less
than the annualized contract base at Completion 15 months thereafter.  SiRViS
will pay up to a further #475,000 in cash, on a # for # basis on new recurring
contracted revenues gained from existing TMG prospects during the 15 months from
Completion.

The cash consideration is to be funded through the use of existing bank
facilities and the proceeds of the Placing detailed above.

Trading Update

As previously announced, over the last nine months we have concentrated on
increasing our gross margins.  As a result, margins have continued to recover as
we have reduced the level of low margin hardware sales and turned away less
profitable business.  Whilst our profitability remains broadly in line with
market expectations, we anticipate that as a result of our margin led approach,
revenues for the year to 31 May 2007 will be lower than those achieved in the
previous year.  The approach from K3 Business Technology Group plc in December
2006 did cause significant disruption to our business but that is now behind us
and we look forward to the future with confidence.

New board appointment

Robert Christopher Brittaine aged 54  has today been appointed a director of the
Company.  In 1983, Bob led the buy-out of TMG from Hamilton Rentals Limited.  He
has worked in IT services since 1977 having also worked for Plessey and Hewlett
Packard. Bob also entered into a contract of employment with the Company today
which confirmed his appointment as the Sales Director for the SiRViS group of
companies for an initial period of 12 months and thereafter the Contract can be
terminated on giving three months notice.  The contract of employment contains
restrictive covenants during his employment and for three months thereafter
(non-compete) and otherwise 12 months thereafter.  These covenants include;
non-competition, non-solicitation, non-acceptance of business from customers and
non-solicitation of employees or consultants.  Bob's basic remuneration is
#80,000 per annum and he also benefits from life cover, private medical cover,
permanent health insurance and pension contributions in each year equal to seven
per cent. of basic salary (subject to a salary cap of #105,600)

Bob Brittaine holds or in the last five years has held the following
directorships or partnerships.

Technology Management Group Ltd
ATM Ltd
Pulse Service Centre Ltd
Advanced Technology Maintenance Ltd
Advanced Technology Marketing Ltd
ComputerSource Ltd

Pulse Service Centre Ltd was placed into receivership in 2005 when Bob Brittaine
was a director of the company.  Other than this there is no further disclosures
required under Schedule Two, Annex III, paragraph (g) of the AIM rules

As at today, Bob Brittaine has no interest in the issued share capital of the
Company.

Directors shareholdings

Members of the Board are subscribing for shares in the Placing as shown below:

                       Number of                             Percentage of   
                    Ordinary Shares    Ordinary Shares        issued share
                   subscribed for at    held following      capital following
Director           the Placing Price     the Placing          the Placing

Peter Addison           333,333             433,333               0.3%
Mark Lewis              666,667           1,864,237               1.4%
Ian Bailey              666,667           1,016,667               0.8%
Ian Lancaster           166,666             166,666               0.1%

Total              1,833,333                 3,480,903                  2.6%

Commenting on the acquisition and placing, Mark Lewis Chief Executive said:

"We are delighted to have completed this important acquisition and increased the
strength of our Board through the addition of Bob Brittaine.  TMG is an
important step in building SiRViS IT into a larger and more profitable business.
The acquisition is expected to be earnings enhancing and will significantly
increase the value of our contracted revenues."

11 May 2007

For further information please contact:


Mark Lewis                                                       01773 825516
Chief Executive

JM Finn & Co Ltd
Geoff Nash                                                       020 7600 1660




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