Acquisition of EPL Composite Solutions Limited

Haydale Graphene Industries plc                        

                         ("Haydale" or the "Company")                          

            Acquisition of EPL Composite Solutions Limited ("EPL")             

Haydale Graphene Industries plc (AIM:HAYD), the Company focused on enabling
technology for the commercialisation of graphene, is pleased to announce that
it has entered into an agreement to acquire the entire issued share capital of
EPL, specialists in the design, development and commercialisation of advanced
composite polymer materials both in the UK and overseas (the "Acquisition").

Highlights:

  * EPL is a recognised composite R&D and testing house, based in Loughborough
    with 17 scientists and technicians. EPL's customers include significant
    corporations such as National Grid, SSE, Eirgrid, Chevron, Anglian Water,
    Severn Trent Water, Yorkshire Water and 3M;
   
  * Total maximum consideration payable is £1.381 million comprising £400,000
    in cash and £187,691 in directors loans with up to £792,500, payable in
    either cash and/or shares in the Company based on earnings targets to 30
    June 2016;
   
  * EPL is already revenue generating with sales of £815,000 and profit before
    taxation of £26,000 in the year ended 31 March 2014;
   
  * Haydale has agreed commercial terms with Silicon Valley Bank for a new £
    500,000 facility to part fund the Acquisition. The loan has a three year
    term with repayments expected to be funded from cash generated by EPL. The
    facility thereby preserves the Group's existing cash resources to fund its
    other development and growth programmes; and
   
  * Recent tests conducted by EPL, in collaboration with Haydale, using a
    standard epoxy resin mixed with Haydale functionalised Graphene Nano
    Platelets ("GNPs"), have shown over a 200% improvement in ultimate tensile
    strength (a measure of material toughness) using just 2% loading of
    Haydale's GNPs.
   
Further information:

The Acquisition by Haydale of EPL is for an aggregate consideration of up to £
1.381 million payable in cash and new ordinary shares in Haydale. The
Acquisition is in line with Haydale's strategy of forming partnerships with
companies who already have market presence in its target sectors. EPL's access
to the composites market is intended to enhance Haydale's sales potential in
this area. Haydale and EPL are already collaborating on a number of projects.

The Acquisition is a major step in capitalising on Haydale's proprietary
technology which enables it to incorporate graphene and other nano enhancing
fillers into composites; a global and growing industry where market research
firm IDTechEx forecast the Graphene element alone to be worth approximately
$80m by 2018.

EPL has developed a reputation for delivering innovative solutions in the
commercial applications of advanced polymer composite materials working with
global companies over more than 20 years. EPL is focused on a range of market
sectors including pipe lining for the oil, gas and water industries,
infrastructure for electricity and energy sectors plus the marine and
transportation markets.

EPL's competence spans the entire development cycle from applied research,
product design, process development, product testing and certification, to
setting up manufacturing plants. EPL also works with OEMs and end-users to
develop and provide composite solutions with demonstrable clear technical,
economic and environmental benefits over existing structures currently
manufactured in traditional materials such as steel, aluminium, wood or
concrete.

Ray Gibbs, CEO at Haydale, commented:

"This acquisition is a major step forward for us because the rapidly growing
composites industry is known for the early adoption of new technologies and is
one of the major markets for embracing disruptive technology and introducing
innovative new materials. The ground breaking work independently undertaken by
Aerospace Corporation in the USA using our standard plasma treated GNPs has
already proven that our patented applied for process can enable the development
of lighter, stronger composite materials and we now have direct access to
companies looking for exactly that. In addition, the credibility of our plasma
process was boosted when the UK National Physical Laboratory ("NPL") reported
positively on the confirmation of our capability to add compatible chemical
groups on the surface of the GNPs: known as functionalisation. "

About EPL:

EPL is a well-respected and recognised composite R&D and testing house, based
in Loughborough with 17 scientists and technicians. EPL's customers include
significant corporations such as National Grid, SSE, Eirgrid, Chevron, Anglian
Water, Severn Trent Water, Yorkshire Water and 3M.

In recent tests conducted by Haydale, in collaboration with EPL, using a
standard epoxy resin mixed with Haydale functionalised GNPs, Haydale achieved
over a 200% improvement in ultimate tensile strength (a measure of material
toughness) using just 2% loading of Haydale's GNPs. These excellent results can
now be demonstrated to the composite industry and specifically, to the
extensive client list of EPL.

In the year ended 31 March 2014, EPL's audited sales were £815,000 and profit
before taxation was £26,000. Audited net assets were £274,000 as at 31 March
2014. EPL's management will continue to manage EPL's business and Gerry Boyce,
the majority owner and Managing Director of EPL, will join the board of Haydale
Limited, the Company's main operating subsidiary.

Acquisition Details:

EPL is being acquired for a mix of cash and new ordinary shares in Haydale.
Initial Consideration comprises £400,000 in cash ("Initial Consideration") and
Haydale will procure the repayment by EPL of £187,691 of shareholder loans due
to the EPL shareholders of which £123,643 will be immediately applied by Gerry
Boyce in subscribing for 198,623 new ordinary shares in Haydale at a price of
62.25p per share (being the closing price of Haydale shares on 31 October 2014)
("New Shares"). The New Shares are subject to a 12 month lock-in provision,
followed by a 12 month orderly market arrangement. In addition, the EPL vendors
may receive up to a further £792,500 payable in cash (or, at the election of
the vendors, new ordinary shares in Haydale at the closing price of Haydale on
the date immediately prior to the date of such election), dependent on EPL
achieving certain agreed profit targets for the period to 30 June 2016. The EPL
vendors are providing Haydale with usual warranties and indemnities in respect
of EPL and their ownership of it.

To satisfy the Initial Consideration, Haydale is pleased to announce that it
has agreed commercial terms with Silicon Valley Bank ("SVB") to provide Haydale
with a three year, £500,000 loan facility ("Facility"). The rationale for
entering the Facility is to allow Haydale to preserve its existing cash balance
for organic growth and to match EPL's expected cash generation against the
Facility's repayment profile. Silicon Valley Bank is a commercial bank that is
dedicated to serving technology, life science, venture capital and private
equity businesses.

Application for the admission of the New Shares to trading on AIM has been made
and trading in the New Shares is expected to commence on 6 November 2014. The
New Shares will rank pari passu with the existing ordinary shares of the
Company. Following the issue of the New Shares, the Company's enlarged issued
ordinary share capital will comprise 11,446,446 ordinary shares of 2p each.
This number may be used by shareholders in the Company as the denominator for
the calculations by which they will determine if they are required to notify
their interest in, or a change in their interest in, the share capital of the
Company under the FCA's Disclosure and Transparency Rules.

Ray Gibbs continued:

"The acquisition of EPL provides us with an immediate route into the fast
moving and dynamic composites market together with a substantial R&D resource
and dedicated composite and polymer expertise to boost our current in-house
capability. Our strategy is to provide solutions in enabling the
commercialisation of graphene in key targeted strategic markets. Our recent
collaboration with the speciality inks and coatings solutions provider, the
Welsh Centre for Printing and Coating (WCPC), addresses one of our key
strategic markets. The acquisition of EPL, together with our WCPC association,
provides us direct access into two substantial industries known for the early
adoption of new technologies and offers us exciting future opportunities."

Gerry Boyce, the majority owner of EPL added:

"We have been working with Haydale since the beginning of this year testing
their materials and have been very impressed with their technology. The
composite industry is always looking for innovative technology and has long
recognised the benefits of using nanomaterials in composites. Haydale's
proprietary technology, as verified by Aerospace Corp and NPL, opens up a range
of opportunities in the composites world not previously available to EPL. "

For further information please contact:

Haydale Graphene Industries plc                   01269 842 946                
                                                                               
John Knowles, Chairman                                                         
                                                                               
Ray Gibbs, Chief Executive Officer                                             
                                                                               
Cairn Financial Advisers LLP (Nomad)              0207 148 7900                
                                                                               
Tony Rawlinson                                                                 
                                                                               
Paul Trendell                                                                  
                                                                               
Cantor Fitzgerald Europe (Broker)                020 7894 7000                 
                                                                               
David Foreman                                                                  
                                                                               
Paul Jewell                                                                    
                                                                               
Hermes Financial PR                                                            
                                                                               
Trevor Phillips                                  07889 153 628                 
                                                                               
Chris Steele                                     07979 604 687                 
                                                                               

About Haydale

Haydale has developed a patent-pending proprietary scalable plasma process to
functionalise graphene and other nanomaterials. This enabling technology can
provide Haydale with a rapid and highly cost-efficient method of supplying
tailored solutions to enhance applications for both raw material suppliers and
product manufacturers.

Functionalisation is carried out through a low-pressure plasma process that
treats both mined, organic fine powder and other synthetically produced
nanomaterial powders, producing high-quality few layered graphenes and graphene
nanoplatelets. The process can functionalise with a range of chemical groups,
with the level of functionalisation tailored to the customer's needs. Good
dispersion improves the properties and performance of the host material and
ensures the final product performs as specified.

The Haydale plasma process does not use wet chemistry, nor does it damage the
material being processed; rather, it can clean up any impurities inherent in
the raw material. The technology is a low energy user and most importantly
environmentally friendly. The Haydale method is an enabling technology,
allowing the Company to work with a raw material producer who seeks to add
value to the base product and tailor the outputs to meet the target
applications of the end user.

Haydale, based in South Wales and housed in a purpose-built facility for
processing and handling nanomaterials, is facilitating the application of
graphenes and other nanomaterials in fields such as inks, sensors, energy
storage, photovoltaics, composites, paints and coatings.

www.haydale.com

About EPL

EPL is an independent company specialising in the design, development and
commercialisation of advanced polymer composite materials on a global basis.

EPL spans the entire development cycle from applied research, product design,
process development, product testing and certification, to setting up
manufacturing plants. EPL also works with OEMs and end-users to develop and
demonstrate composite solutions which provide clear technical, economic and
environmental benefits over existing structures currently manufactured in
traditional materials such as steel, aluminium, wood or concrete.

Having demonstrated these benefits and generated a demand, EPL then looks to
identify commercial partners - either under licence or as a joint venture - to
scale up and manufacture the composite solution on either a regional or global
volume basis.

www.eplcompositesolutions.co.uk