Share price: 161.50p


30th March 2007

Cello extends its healthcare marketing capability with the acquisition of MSI

Cello Group plc (“Cello”, AIM: CLL), the market research and consulting group has acquired The MSI Consultancy Limited (“MSI”), a leading healthcare marketing consultancy. Initial consideration consists of approximately £5.7 million with further performance related consideration of up to a maximum of £7.5 million.

MSI, which was established in 1994 acts for a number of blue chip clients including Sanofi Aventis, Shire Pharmaceuticals and Pfizer.

The initial consideration consists of approximately £5.7 million of which £3.9 million is payable in cash or loan notes and the balance satisfied by the issue of 1,198,402 new ordinary shares. In addition, there are further performance related payments over the period to 31 December 2010. These further payments are in a mixture of loan notes and new ordinary shares at Cello’s discretion, with a minimum overall loan note consideration of approximately 50% of the further consideration.

For the year to 31 May 2006, MSI had a turnover of £2.9 million, audited profits before tax of £0.3 million and normalised profits before tax of £0.7 million. Net assets as at 31 May 2006 were £0.9 million including cash of £1.3 million.

Application has been made to the London Stock Exchange for the new shares to be admitted to AIM and it is expected that admission will take place by 5 April 2007.

Kevin Steeds, Cello Chairman, said:

“MSI is an exciting addition to the Cello Group, bringing to us excellent upstream marketing consultancy capability in a key sector vertical. The skill base of MSI complements our established international market research business, Insight.”

Stephen Highley, MSI Managing Director, said:

“Cello offers us significant opportunity to accelerate the growth of MSI and provide additional capability to enhance a number of services that healthcare companies need.”


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