Possible Offer/Trading Update

Inspace Plc
10 December 2007


Press Release                                                  10 December 2007



                                  Inspace plc

                Statement re: possible offer and trading update



Inspace plc ('Inspace' or 'the Company') announces that it has received an
indicative proposal from Willmott Dixon Limited regarding a possible cash offer
for the Company at a price of 183 pence per share. Willmott Dixon Limited is a
private company majority owned by the Willmott and Dixon Families.



Colin Enticknap, in his capacity as Group Chairman of Willmott Dixon, has been
leading discussions on Willmott Dixon's behalf with the Independent Directors of
Inspace, supported by their respective advisers.



Whilst discussions are at an advanced stage, there can be no certainty that an
offer will be made. A further announcement will be made in due course.



This announcement has been made with the consent of Willmott Dixon.



Current trading



Despite a more challenging second half year, overall trading is in line with
market forecasts for the year ended 31 December 2007. As usual, there are issues
to be resolved before the accounts are closed, most notably the agreement of
annual performance-related incentive payments with clients. Whilst these are
running at higher levels than normal, the Directors remain optimistic that
satisfactory settlements will be reached.



Social Housing

Our core Social Housing market remains robust, particularly in terms of new
build activity which is expected to provide the majority of future revenues for
this division. With many good opportunities on the ground, sales and
preconstruction teams are working across a variety of framework and project
specific bids, and conversion rates are good. Sourcing land and securing
planning consents remain the key frustrations for social housing customers,
creating the main constraint on what might otherwise be higher growth rates.



Decent Homes work continues to be difficult for Inspace to procure with pricing
levels becoming more aggressive as existing programmes draw to an end. This has
now translated into growing competitiveness on maintenance tenders, in part due
to Decent Homes contractors migrating into this area.



Affordable Housing

Recent uncertainty about house prices is now impacting our Affordable Housing
division. In some instances, launch prices have been reduced in order to keep
reservation levels at an acceptable level. Investor interest, which has
traditionally fed a material proportion of sales, has declined in broad terms
although we are seeing some larger strategic investors prepared to speculate on
multiple unit deals in order to induce greater discounts. With just four
developments currently on site, we are less exposed to short term market
fluctuations than the volume builders. One of those sites will be complete in
the first quarter of 2008 and is fully sold; the second, launched in the summer,
is almost fully reserved. The two remaining sites have just been launched with
all unit sales budgeted for the last quarter of 2008. Looking further ahead, the
three London Wide Initiative and Dee Park regeneration schemes provide the
backbone of our sales programme from 2009.



Corporate Assets

Our Corporate Assets division operates in two sectors: the property maintenance
sector and the interior fit-out sector. The former remains robust in terms of
volume, albeit the fragmented structure of the supply side and low barriers to
entry continue to create a competitive pricing environment. Efforts to segment
our customer base, growing volumes with higher spending property portfolio
holders and reducing volumes with those offering lower or less predicable
spending patterns, continues and is progressing satisfactorily alongside the
roll-out of the new technology platform aimed at improving efficiency.



Interior fit-out remains our most volatile sector, being dependent upon the
commercial office market, particularly in central London. Whilst we have seen
good growth during 2007, we are now seeing reduced confidence levels, a
corresponding reduction in our sales pipeline and some pending orders being
shelved.




Forward Order Book

The forward order book at the year end is expected to be marginally lower than
our declared targets of 85% of revenue for the Social Housing division and 75%
for the Corporate Assets division.  The Social Housing shortfall, which relates
mainly to maintenance activity, will be rectified if we secure a maintenance
contract with Birmingham City Council where a decision is expected early in the
New Year. The Corporate Assets shortfall relates mainly to interior fit-out
where we are more exposed approaching 2008 than we would have liked. Experience
has taught us that volumes can also improve quickly, but we are monitoring the
position carefully and will retain the flexibility to reduce capacity if
required.



Revenues in the Affordable Housing division are becoming less predictable, with
a noticeable reduction in viewings and reservations over recent weeks.



Enquiries:


Dresdner Kleinwort
Christian Littlewood                                Tel: [phone]
Robert Dawson



Media enquiries:
Abchurch
Henry Harrison-Topham                               Tel: [phone]
[e-mail]                            www.abchurch-group.com





Dresdner Kleinwort Limited, which is authorised and regulated by the Financial
Services Authority, is acting for Inspace plc and for no-one else in connection
with any potential offer and will not be responsible to anyone other than
Inspace plc for providing the protections afforded to customers of Dresdner
Kleinwort Limited or for affording advice in relation to any potential offer.



Disclosure in accordance with Rule 2.10 of the City Code:



In accordance with Rule 2.10 of the City Code on Takeovers and Mergers (the '
Code'), Inspace confirms that it has in issue and admitted to trading on the
London Stock Exchange 81,001,690 ordinary shares of 2 pence each under the ISIN
code GB00B07NFJ53.



Dealing Disclosure Requirements



Under the provisions of Rule 8.3 of the Code, if any person is, or becomes, '
interested' (directly or indirectly) in 1% or more of any class of 'relevant
securities' of Inspace plc, all 'dealings' in any 'relevant securities' of
Inspace plc (including by means of an option in respect of, or a derivative
referenced to, any such 'relevant securities') must be publicly disclosed by no
later than 3.30 pm (London time) on the London business day following the date
of the relevant transaction. This requirement will continue until the date on
which the offer becomes, or is declared, unconditional as to acceptances, lapses
or is otherwise withdrawn or on which the 'offer period' otherwise ends. If two
or more persons act together pursuant to an agreement or understanding, whether
formal or informal, to acquire an 'interest' in 'relevant securities' of Inspace
plc, they will be deemed to be a single person for the purpose of Rule 8.3.



Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant
securities' of Inspace plc by Inspace plc, or by any of their respective '
associates', must be disclosed by no later than 12.00 noon (London time) on the
London business day following the date of the relevant transaction.



A disclosure table, giving details of the companies in whose 'relevant
securities' 'dealings' should be disclosed, and the number of such securities in
issue, can be found on the Takeover Panel's website at
www.thetakeoverpanel.org.uk.



 'Interests in securities' arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an 'interest' by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.



Terms in quotation marks are defined in the Code, which can also be found on the
Panel's website. If you are in any doubt as to whether or not you are required
to disclose a 'dealing' under Rule 8, you should consult the Panel.
-Ends-


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