Disposal Agreement

Milestone Group PLC
21 August 2006


For Immediate Release                                             21 August 2006

                              Milestone Group PLC

                               DISPOSAL AGREEMENT


On 4 August 2006, AIM listed Milestone Group PLC ('Milestone' or 'the Company')
announced it was in negotiation with Letterbronze Limited ('Letterbronze') to
dispose of the whole of its publishing division, including the Property Weekly
series of publications ('Property Weekly'), for a total consideration of
£1,025,000.


Milestone is today announcing it has entered into a different agreement, subject
to Shareholder approval, to dispose of Property Weekly as a stand-alone business
unit to Tindle Newspapers Limited ('Tindle') for a consideration of £1.4
million.


Letterbronze had originally offered the Company, subject to due diligence and
contract, approximately £775,000 to acquire Courier Newspapers (Oxford) Limited
('CNL'), and approximately £250,000 to acquire Basingstoke Observer Limited,
with a cash adjustment to reflect the net asset values of the businesses at the
time of completion.


In light of the consideration offered by Tindle for Property Weekly, which is
around £375,000 higher than that which had previously been offered by
Letterbronze for the whole of Milestone's publishing division, negotiations with
Letterbronze have now been terminated by mutual consent. Consequently, the
Company is to adjourn the Extraordinary General Meeting ('EGM'), due to take
place at 9.00am this morning.


The Company intends to convene a new EGM for on or around 11 September 2006 to
approve a new resolution, as required under Section 15 of the AIM Rules, to
authorise the proposed disposal of Property Weekly to Tindle ('the Disposal').
Completion of the Disposal is intended to take place on 11 September 2006, or as
soon as possible thereafter. A circular setting out further details of the
Disposal and notice of the new EGM will be posted to Shareholders in the coming
days. A further Announcement will be made at the time of posting.


Milestone Chief Executive, Andy Craig, said:


'Throughout the Company's strategic review, we have made clear that we are
committed to explore all opportunities to maximise Shareholder value at what is
a challenging time for the regional newspaper industry.


'We are delighted to have been able to reach this new agreement, securing a
consideration that is almost 40 per cent higher than that which had originally
been offered by Letterbronze for the whole of Milestone's publishing division,
thereby enhancing the ongoing cash position of the Company. Furthermore, the
Company has also entered into an agreement with Tindle to share future newspaper
distribution costs in Oxfordshire, which we believe will have a material
positive impact on the ongoing publishing business.


'Milestone is now reopening discussions with a number of third parties regarding
the disposal of the remainder of the Company's publishing division.'


Property Weekly is a free broadsheet newspaper containing advertisements for
homes to buy and rent with three separate editions covering north Oxfordshire,
south Oxfordshire and Newbury, together with an associated website.
Approximately 75,000 copies of Property Weekly are currently printed each week
and distributed via a mixture of door-to-door delivery and dispensers located in
estate agents and retail outlets.


Property Weekly is currently published by CNL, a wholly owned subsidiary of the
Company. No goodwill is directly attributable to Property Weekly in the accounts
of CNL.


According to CNL's unaudited management accounts, Property Weekly produced a
turnover of £856,000 for the ten months ended 31 July 2006. A large proportion
of the overheads of Property Weekly have traditionally been absorbed by CNL.
Management estimate that Property Weekly would have produced a profit of
approximately £150,000 during the first ten months of this financial year if it
had been operating as a stand alone business unit, responsible for its own
distribution.


Under the terms of the Disposal, CNL has agreed to transfer its newspaper
distribution department to Tindle. This department is responsible for the
distribution of Property Weekly and a number of CNL's ongoing titles in
Oxfordshire, in particular Courier Journal and Auto Weekly.


The Company has entered into a cooperation agreement with Tindle that guarantees
continued door-to-door delivery for CNL's free newspapers in Oxfordshire,
substantially reducing CNL's distribution costs. The agreed rates will apply for
a minimum period of two years following completion of the Disposal.


Following the Disposal, the Company's main trading units will remain:


   •Courier Newspapers (Oxford) Limited - publishes Courier Journal series
    (Oxfordshire), Oxford City Journal, Auto Weekly (Oxfordshire), Oxfordshire
    Living, West Berkshire News


   •Basingstoke Observer Limited - publishes Basingstoke Observer (North
    Hampshire)


   •Oxford Broadcasting Limited trading as SIX TV - operates 'SIX TV' branded
    local television channels in Oxford and Southampton


The consideration for the Disposal of £1.4m is payable in full upon Completion.
The Milestone Board intends to use approximately £150,000 of the consideration
to meet existing liabilities within the Company's publishing division and to
enhance the balance sheet of CNL.


The net proceeds from the Disposal will also be used, in part, to meet the
general working capital requirements of the Company. However, it is hoped that
the Company will be in a position to retain a significant proportion of the
consideration, either to distribute to Shareholders or to invest in new
ventures. Following completion, a review of the best use of the proceeds and
Milestone's ongoing business strategy will take place under the direction of the
Company's non executive Chairman, John Sanderson, in consultation with the
Company's nominated adviser, Arden Partners PLC.



For further information


Milestone                                   Tel: [phone]

Andy Craig/Daniel Cass


Arden Partners                              Tel: [phone]

Richard Day


Buchanan Communications                     Tel: [phone]

Bobby Morse/Suzanne Brocks



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