Acquisition

RNS Number:7961R
AWG Services PLC
07 November 2003


                               AWG Services plc

                  Proposed acquisition of Oak Holdings Limited

                         Key points of the transaction


*  AWG, the AIM quoted cash shell, is to acquire Oak Holdings, a property
   development group

*  Consideration for the acquisition is the issue of 490.3 million new
   ordinary shares in AWG, representing 75% of the Enlarged Issued Share Capital

*  Oak's five directors will join the AWG board, providing experience of
   managing significant property development projects

*  Oak's strategic focus is developing mixed use leisure oriented schemes

*  Oak has been appointed as preferred developer for a major leisure
   development project near Rotherham

*  AWG shareholders will receive 5 warrants to subscribe for new ordinary
   shares for every 8 AWG shares held at 6 November 2003, exercisable at 2.38p 
   per share.


Commenting on the acquisition, Stephen Thomson, Chairman of AWG, said:

"Since the realisation of the majority of AWG's assets, the board has been
seeking to identify an attractive acquisition and has examined many
opportunities.  Oak is one which is close to our objective of providing the
potential for high reward for shareholders albeit with a level of risk.

The Oak directors and in particular Malcolm Savage and Stephen Lewis provide
long experience of identifying and delivering significant property development
projects.  In the Rotherham project, there is already an exciting opportunity to
demonstrate this, working closely with local government and government agencies.

Following a successful EGM, I shall be staying on the Board as Deputy Chairman
with Michael Hill as Finance Director to support the ongoing development of the
Group."



For further information, please contact:

AWG Services plc
Stephen Thomson, Executive Chairman                 Tel:  [phone]

City Financial Associates Limited
Tony Rawlinson                                      Tel:  [phone]

For Oak Holdings Limited:
St. Brides Media & Finance Limited
Hugo de Salis                                       Tel:  [phone]





Proposals for the Acquisition of Oak, change of name to Oak Holdings plc, issue
of Warrants to Shareholders, amendments to the Articles of Association and
re-admission to trading on the Alternative Investment Market


Introduction

The Board of AWG announces that AWG has conditionally agreed to acquire the
entire issued share capital of Oak. Oak will be acquired in consideration of the
issue of the Consideration Shares, which will represent approximately 75 per
cent. of the Enlarged Issued Ordinary Share Capital. In view of the fact that
the Acquisition will result in a change of control of the Group and a
fundamental change in its business, the Acquisition will constitute a reverse
takeover of AWG under the AIM Rules and therefore requires the prior approval of
Shareholders at an extraordinary general meeting. In view of the size of the
shareholding of the Concert Party in the Company following implementation of the
Proposals, completion of the Acquisition will represent a change of control
under the City Code and would require an offer for the balance of the shares
unless a waiver from this requirement is approved by Shareholders at an
extraordinary general meeting. If the Resolutions are duly passed at the EGM,
AWG's existing share quotation on AIM will be cancelled and AWG will apply for
the Enlarged Issued Ordinary Share Capital to be re-admitted to AIM. If the
Proposals are approved by Shareholders it is expected that dealings in the
Enlarged Issued Ordinary Share Capital will commence on 2 December 2003.


Background to and reasons for the Proposals and information on Oak

Oak was formed in 2000 as a property development company. The founding
shareholders and directors of the company included St. John Hartnell, Malcolm
Savage, Stephen Lewis and Peter Collins.

In 2000, the Yes Project, a leisure development project located near Rotherham
in Yorkshire, was identified and, since then, the Oak management team has worked
towards being appointed the preferred developer for the project. This goal was
achieved and is reflected in the Preferred Developer Agreement signed on 16 May
2003.

Oak's prime current intention is to develop the Yes Project and to identify
other mixed use leisure-oriented development schemes.  Pursuant to the Preferred
Developer Agreement, Oak has a two year exclusive period in which to progress
the Yes Project.  Oak's current activities are centred on developing the concept
of the Yes Project to secure outline planning permission.


Terms of the Acquisition

Under the terms of the Acquisition Agreement, AWG has conditionally agreed to
acquire the entire issued ordinary share capital of Oak for a consideration to
be satisfied by the issue of 490,313,105 Consideration Shares, which will
represent approximately 75 per cent. of the Enlarged Issued Ordinary Share
Capital.

All the shareholders of Oak have undertaken not to dispose of their shares (save
in certain limited circumstances) for various periods and, for a period after
such lock-in period, only to dispose of their shares on an orderly market
basis.  The periods for these lock-ins vary up to two years.  In addition,
Stephen Thomson and Michael Hill have also entered into similar lock-ins for a
one year period.

In addition, the vendors of Oak have undertaken to subscribe, in aggregate,
#250,000 for a further 12.1 million shares in AWG at 2.06p per share in
proportion to their shareholdings in Oak if called for by a committee of the
board of AWG to boost the working capital of the Enlarged Group.


Management and employees

The Oak Directors are Malcolm Savage, Stephen Lewis, Peter Collins, St. John
Hartnell and Graham Axford.


Financial record

Oak's consolidated balance sheet at 30 April 2003 showed net liabilities of
#240,053 supported by amounts funded by the Oak Directors of #147,408. These
amounts are being formalised as part of the Acquisition as being interest free
loans and not due for payment (subject to acceleration in certain defined
circumstances) before June 2007, the anticipated date for completion of the Yes
Project.


Information on AWG

AWG was formerly an owner and operator of narrowboats. Following the disposal of
the bulk of the narrowboat fleet in July 2002, the Company has negligible
current trading activities. The remaining assets of the Company are cash of
approximately #1.24 million as at 30 September 2003, one remaining narrowboat
and 5.67 acres of freehold land at Great Haywood, which together have a net book
value of #159,150. The Board does not expect the disposal proceeds of the
Company's remaining assets to be less than their book values.


Directors and Proposed Directors

The current Board of Directors comprises Stephen Thomson (Executive Chairman),
Michael Hill (Finance Director) and David Court OBE (Non-executive Director).

On completion of the Proposals and Re-admission there will be several changes to
the existing Board. Stephen Thomson will move from his position as Executive
Chairman to take up the position of Deputy Chairman, Michael Hill will remain
Finance Director and Company Secretary and David Court will step down from the
Board. The Proposed Directors will join the board. They are Malcolm Savage, who
will become Executive Chairman, Stephen Lewis who will become Chief Executive,
and St. John Hartnell, Graham Axford and Peter Collins who will become
Non-executive Directors. Stephen Lewis has entered into a service agreement with
the Company, which either party may terminate on 12 months' written notice.
Malcolm Savage has entered into a consultancy agreement with the Company, which,
initially, either party may terminate on 12 months' written notice.


Change of name

In line with the Proposals, the Company is proposing to change its name from AWG
Services plc to Oak Holdings plc following completion of the Acquisition.


Warrants

The Board is proposing that there will be an issue of Warrants to all Existing
Shareholders on the basis of five Warrants for every eight Existing Shares held
on the Record Date. Fractional entitlements will not be allotted. The total
number of Warrants in issue will be up to 101,419,843, equivalent to
approximately 13 per cent. of the Enlarged Issued Ordinary Share Capital
following completion of the Acquisition and exercise of all the Warrants. It is
not currently intended that the Warrants will be quoted on AIM and they will not
be freely transferable. Each Warrant will entitle the holder to subscribe for
one new Ordinary Share at an exercise price of 2.38 pence per Ordinary Share and
will expire in 2013.


Working capital

The Directors and Proposed Directors believe that the cash and credit facilities
currently available to the Enlarged Group will provide sufficient working
capital for the Company's present requirements, that is, to enable it to pursue
an application for outline planning permission for at least the next 12 months.
In the event that there is a material delay in outline planning permission for
the Yes Project being obtained beyond 31 July 2004, the date anticipated by the
Directors and Proposed Directors for the grant of outline planning permission,
it is likely that the Company will need to raise additional funds. In the event
that outline planning permission is granted, the Directors and Proposed
Directors plan to fund the development phase with a development loan.


Extraordinary General Meeting

The Proposals are subject to Shareholder approval at an EGM of the Company to be
held at 10.00 a.m. on 1 December 2003.

EXPECTED TIMETABLE (all dates are 2003)

Record Date for the issue of the Warrants - 6 November

Despatch of Warrant certificate - 14 November

Latest time and date for receipt of forms of proxy for the Extraordinary General
Meeting - 10.00 a.m. on 29 November

Extraordinary General Meeting - 1 December

Admission effective and dealings commence in the Enlarged Issued Ordinary Share
Capital on AIM - 2 December




For further information, please contact:

AWG Services plc
Stephen Thomson, Executive Chairman                 Tel:  [phone]

City Financial Associates Limited
Tony Rawlinson                                      Tel:  [phone]

For Oak Holdings Limited:
St. Brides Media & Finance Limited
Hugo de Salis                                       Tel:  [phone]





City Financial Associates Limited, which is regulated by The Financial Services
Authority, is the Company's Nominated Adviser for the purposes of the AIM Rules.
Its responsibilities as the Company's Nominated Adviser under the AIM Rules are
owed solely to the London Stock Exchange and are not owed to the Company or any
Director. City Financial Associates Limited will not be responsible to anyone
other than the Company for providing the protections afforded to customers of
City Financial Associates Limited or for advising any other person on the
Proposals and other arrangements described in this document.

To the best of the knowledge and belief of the Directors (who have taken all
reasonable care to ensure that such is the case) the information contained in
this announcement is in accordance with the facts and does not omit anything
likely to affect the import of such information. The Directors accept
responsibility accordingly, including individual and collective responsibility
for compliance with the AIM Rules.

The Proposed Directors accept responsibility for the information contained in
this announcement relating to themselves and their associates and collectively
for the information relating to Oak Holdings Limited and its subsidiary. To the
best of the knowledge and belief of each of the Proposed Directors (each of whom
has taken all reasonable care to ensure that such is the case) the information
contained in this announcement for which he accepts responsibility is in
accordance with the facts and there is no omission likely to affect the
importance of that information.

Definitions in this announcement apply as they are set out in the admission
document dated 7 November 2003 which is being sent to shareholders of AWG today
and is available from the offices of City Financial Associates Limited, 6
Laurence Pountney Hill, London EC4R 0BL.


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