Acquisition

RNS Number:1547B
Imagesound PLC
31 July 2007

31 July 2007

                                 Imagesound plc

                     Acquisition of TSC and Trading Update

Highlights:


-    Acquisition of TSC for #4.75m

-    TSC adds major new clients including, Starbucks, Orange, Caffe Nero,
     Gala, Montblanc and Alliance & Leicester and a total of 3,500 additional 
     outlets

-    Directors expect the acquisition to be earnings enhancing in first full
     year of ownership

-    Imagesound's trading for the first six months of 2007 is in line with
     expectations

Acquisition of TSC Music Systems Limited

Imagesound plc (AIM: ISD.L), the UK's leading listed supplier of in-store music,
radio and TV services to the branded retail and leisure sectors, today announces
that it has acquired the business and assets of TSC Music Systems Limited
("TSC") for #4.5m in cash on completion, with a deferred amount of approximately
#250,000 payable post completion subject to the actual net assets acquired.

TSC is a major supplier of music services to the branded fashion retail, coffee
chain, fast food and retail financial services sectors, supplying over 3,500
outlets across the UK with in-store music solutions. Its customer base includes
leading brands such as Billabong, Orange Retail, Montblanc, Starbucks, Caffe
Nero, Alliance & Leicester, Welcome Break, and Gala.

Founded in 1975 by Neal Abdool, TSC has been established as a background music
supplier and audio equipment installer for over 30 years. Over the past four
years, the company has been managed by James Abdool, son of the company's
founder. James Abdool will join Imagesound's senior executive management team as
Retail Sales Director on completion of the transaction and will assume
responsibility for the combined Group's retail sales team.

TSC is based in Crawley, with a small service centre in Chesterfield and employs
31 staff. The business will be integrated into Imagesound's existing offices in
Chesterfield over the coming months. Imagesound intends to retain a southern
sales office and distribution centre in TSC's Crawley office.

Audited results for 2006 for TSC show turnover of #2.2m, of which #1.3m (59%)
was recurring revenue, adjusted EBITDA of #0.6m and a loss before tax of #68k.
Net assets on completion are expected to be #200k. The Imagesound directors
anticipate that, excluding any costs associated with the integration, the
acquisition will be earnings enhancing in its first full year of contribution.

Imagesound will acquire TSC for a total consideration of #4.75m in cash, funded
by existing bank facilities.

There are no further Schedule Four disclosures to be made.

Trading Update

The Board is pleased to confirm that trading for the first half is in-line with
expectations. The Group has continued to make good progress in its core
business, supplying in-store music, radio and AV services to the retail and
leisure operators. New contracts and service upgrades secured in the first half
include Wickes, Superdrug, Bon Marche, HBOS, Foot Locker, Richleys, Slug &
Lettuce and Ha Ha.

Further progress has also been made by MusicStyling, Imagesound's world leading
provider of bespoke music content to the international luxury hotel, spa and
resort industry which was acquired in May 2006. New wins include properties with
the Four Seasons and Radisson chains, and a major roll out across the Marriott
estate. MusicStyling are due to open a new office in Vancouver in September
2007, to build on its position in the important American hotel market.

The development of the Group's international distribution network has continued,
with 2 distribution agreements signed in the first half with partners in Spain/
Portugal and Dubai. These partners have added 150 new international subscribers
in the year to date. Additionally a supply contract has been signed with
'Alshya' to supply the rapidly expanding Foot Locker stores across the Middle
East and Asia.

Imagesound will announce its interim results for the six months ended 30 June
2007 on 10 September 2007.

Derek Mapp, Executive Chairman of Imagesound said:

"We are pleased with the performance of Imagesound in the first half, which is
trading well and building on its strong position in the market. Today's
acquisition of TSC builds on this position. TSC is a business that is well known
to us and well regarded in our industry, with some outstanding clients and very
talented people. I am delighted to welcome them to Imagesound.

"This acquisition fits very well with our growth strategy and offers significant
integration benefits through improved efficiencies and economies of scale. This
is our sixth acquisition since our flotation in 2004 and a further step in our
plans to leverage Imagesound's operating model and systems by acting as a
consolidator in the fragmented in-store music sector."

Neal Abdool, Chairman of TSC said:

"I am very proud of the business we have built up over the past 32 years and
believe that we have found an excellent partner in Imagesound to take it on to
the next stage. I would like to thank all our employees for their contribution
over the years and our customers for their continued support. I wish them all
every success for the future."

                                    - Ends-

For further information:

Imagesound plc
Derek Mapp, Executive Chairman                     Tel: [phone]

Collins Stewart Europe Limited
Seema Paterson                                     Tel: [phone]

Hogarth Partnership
James Longfield/Sarah Richardson                   Tel: [phone]

Notes to Editors

Imagesound is the UK's leading listed supplier of in-store music, radio and TV
services. It provides music and messaging services to over 45 leading branded
retail and leisure chains reaching over 13,000 subscriber outlets.

Customers include Superdrug, Yates, B&Q, Foot Locker, Carphone Warehouse,
McDonald's, Subway, Halifax, Next, Focus, Holiday Inn, River Island, O'Neill's,,
Pizza Express, Hyatt, Starwood and JJB.

Imagesound is listed on the AIM market of the London Stock Exchange (ISD.L)


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

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