Acquisition

Petards Group PLC
09 March 2006


                  Petards Group plc ('Petards' or 'the Group')


                              Acquisition of EIMC

Petards, the AIM listed developer of advanced surveillance systems, announces
that it has acquired the entire share capital of European Innovation
Manufacturing Centre Limited ('EIMC') for a maximum total consideration of £1.8
million.


EIMC is a specialist supplier of a range of IR (InfraRed) and daylight camera
technologies that underpin many video and ANPR (Automatic Number Plate
Recognition) systems in the UK and Europe and are used in approved systems in
the emerging North American markets.


HIGHLIGHTS

•  Petards to acquire EIMC for an initial payment of £225,000 comprising
of £25,000 in cash and the balance in 14,285,714 new ordinary shares at 1.4p ('
the Initial Consideration Shares').  An additional payment of up to £75,000 in
cash will be made on a performance-related basis for the year ending 31 March
2006.

•  Further payments up to a total aggregate maximum of £1,500,000 will be
made on a performance-related basis for the period ending 31 December 2006 and
the year ending 31 December 2007.  An example of the operation of the earn-out
mechanism is set out below.

•  Acquisition of leading edge technology in rapidly expanding specialist
camera and surveillance equipment markets.

•  Strengthens the Group's position within its existing client base and
adds new opportunities in the global law enforcement, security service and
commercial sectors.


Petards will build on the existing relationships that EIMC has established to
supply ANPR solutions worldwide. The Group will have the opportunity to expand
these systems by incorporating its core range of digital recording, storage and
control room solutions (including UVMSTM and Advantage Net+).


The acquisition will also enable Petards to accelerate the further development
of its market leading Provida range of digital video and speed enforcement
systems.  New systems will meet the growing demands for greater in-car computer
integration and digital storage.  The use of UVMSTM as the management tool for
the storage of high volumes of digital evidence will provide further synergies
and sales opportunities.


EIMC's special-vehicle installation capability also offers Petards an in-house
facility whereby both EIMC and Petards systems will be fitted to a wide variety
of covert and overt surveillance vehicles used by security agencies.


Application will be made for the Initial Consideration Shares to be admitted  to
trading on AIM  and such admission is expected to become effective on 16 March
2006.  The Initial Consideration Shares will rank pari passu with the existing
ordinary shares of the Company.


Further payments up to a total aggregate maximum of £1,500,000 will be made on a
performance-related basis for the ten months ending 31 December 2006 and the
year ending 31 December 2007.  By way of illustration, in the event that
operating profits of EIMC reach £500,000 for the period ending 31 December 2006,
then the further payment for that period will be £133,500 and if they reach
£660,000 in the year ending 31 December 2007, the further payment for that
period will be £175,500.  The additional consideration payable for the excess of
operating profits above these amounts will be paid at a multiple of 1.5 times up
to the maximum.  These further payments will be satisfied by either the issue of
loan notes or new Petards shares at the prevailing market price.  The vendors of
EIMC may elect whether to opt for loan notes or new Petards Shares for the first
£133,500 of the further payment in respect of 2006 and the first £175,000 in
respect of 2007.  Petards have the option as to whether the balance of any
further payments is satisfied by way of loan notes or new Petards shares.


EIMC was founded in 2001 and in the year ended 31st March 2005 it made a profit
after tax of £21,000 on sales of £885,000. At 31st March 2005 it had net assets
of £22,000.


David Hayes, Chief Executive of Petards said: 'I'm delighted that we have been
able to bring EIMC within the Petards Group.  Its experience of camera
technology for ANPR and other applications, linked with Petards' expertise
within mobile and fixed surveillance applications provides a powerful
combination to further Petards global expansion.'


Peter Henden, founder of EIMC and Head of Research said: 'By being part of
Petards we will be able to do justice to the sales potential of our innovative
solutions.  The opportunity to increase our market reach was a key factor in our
decision to join Petards.  We are looking forward to realising the significant
potential of the business as part of a larger group.'


For further information:

Paul McManus, Binns & Co -    Tel: [phone], Mob: [phone]

Andy Wonnacott, Finance Director, Petards Group plc - Tel: [phone]


www.eimc.net

www.petards.com


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