Proposed Placing for US Expansion

RNS Number : 5970X

Purplebricks Group PLC

22 February 2017

 

The information contained in this announcement is inside information for the purposes of article 7 of Regulation 596/2014.

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA, JAPAN, JERSEY OR SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS ANNOUNCEMENT.

22 February 2017

PURPLEBRICKS GROUP PLC

PROPOSED PLACING OF NEW ORDINARY SHARES TO RAISE UP TO £50 million FOR US EXPANSION

Purplebricks Group plc (AIM: PURP) (Purplebricks or the Company) is pleased to announce its intention to raise up to £50 million (before expenses) for US expansion through an issue of new ordinary shares of 1 pence each in the capital of the Company (the Placing Shares), with certain existing and new institutional investors (the Placing). The Placing is being conducted through an accelerated bookbuilding process (the Bookbuild) which will be launched with immediate effect following this announcement.

Highlights of the Placing

·      Purplebricks intends to raise up to £50 million pursuant to the Placing at a price of 220 pence per Placing Share (the Placing Price).

·      The Placing is being conducted, subject to the satisfaction of certain conditions, on the Company's behalf by the joint bookrunners, Zeus Capital Limited (Zeus Capital), Peel Hunt LLP (Peel Hunt) and Investec Bank plc (Investec) (together, the Joint Bookrunners). The Placing is not underwritten by any of the Joint Bookrunners.

·      The Placing Price represents a discount of approximately 0.6 per cent to the closing mid-market price of an Existing Ordinary Share on 21 February 2017, the latest practicable date prior to the publication of this announcement. The number of Placing Shares and the allocations will be determined by the Joint Bookrunners in consultation with the Company at the close of the Bookbuild. 

·      The Bookbuild will commence immediately and is expected to close no later than 7.00 pm today, although the timing of the closing of the Bookbuild, the number of Placing Shares to be issued pursuant to the Placing and the allocations are at the discretion of the Joint Bookrunners (in consultation with the Company). Details of the number of Placing Shares to be subscribed for in the Placing will be announced as soon as practicable after the close of the Bookbuild.

·      The Placing is conditional on, amongst other things, (i) the passing by the requisite majority of Shareholders of resolutions to grant authorities to Directors to allot further shares for cash on a non-pre-emptive basis; and (ii) admission of the Placing Shares to trading on AIM on or before 8.00am on 14 March 2017 (Admission).

·      The net proceeds of the Placing (expected to be up to £48.7 million) will be utilised by the Company to enable Purplebricks to launch its business in the US, initially by establishing itself in a number of key states. The Directors intend that the first stage of the roll out of the Purplebricks proposition in the US will begin in the second half of 2017. The Directors consider that there is a significant opportunity for the Company to make a meaningful impact on the US real estate market, which is estimated by the Company's management to be worth approximately US$70 billion annually in total real estate commission income.

Michael Bruce, Group Chief Executive Officer of Purplebricks Group plc, said:

"We are proud to announce our plans to launch Purplebricks in the US, a market we estimate to be worth some US$70 billion in annual estate agent commission. Our customer proposition of high quality service and value, delivered through the combination of technology and people, is driving irreversible change in the UK and Australian markets. We are confident that with our understanding of the US market and our experience from having already launched in two markets Purplebricks can build a significant business in what could be one of the most fascinating and rewarding real estate markets in the world.

For the realtors we recruit Purplebricks presents an exciting new platform to build scalable, profitable businesses in their own dedicated regions, supported by our strong technology infrastructure and marketing reach. For US customers we are seeking to offer a better deal in selling and buying their homes, with a more convenient, transparent and cost effective service.

As with our UK and Australian launches we will adopt a state-by-state roll out strategy. The funds raised through the Placing will not only be deployed to build the Purplebricks brand in the US but, also, the people and infrastructure needed to manage rapid growth in that market.

With trading in the UK and Australia in-line with the board's expectations and with the development of the US opportunity, we are proud of the team's achievements to date and excited for our global future."

Reasons for the Placing

The net proceeds of the Placing (approximately £48.7 million) will be used for additional expansion capital to enable the Company to establish itself in a number of key states across the US. The Directors consider there to be a significant opportunity to make a meaningful impact on the US real estate market. In particular, the Directors intend to utilise the net proceeds of the Placing to:

(a)  finalise the Company's infrastructure in preparation of the launch into the US;

(b)  finalise the recruitment of the management team for the US business;

(c)  build the Purplebricks brand and raise consumer awareness of the Purplebricks proposition in targeted states across the US through the US advertising and marketing strategy;

(d)  commence the recruitment and training of LPEs in the US; and

(e)  continue the development of the Purplebricks platform.

Details of the Company's planned strategic expansion, as well as information on the US market, further details of the Placing and an operational update on the Company, are set out below.

Defined terms used in this announcement have the meanings given in Appendix III, together with the terms and conditions of the Placing which are set out in Appendix II. Appendix I contains certain risk factors relating to the Company's business, its proposed expansion and an investment in Placing Shares pursuant to Placing.

Background to the United States real estate market

The Directors consider expansion of the Company's business and the Purplebricks brand into the US real estate market to be the next logical step in the Company's expansion. The US, which has a gross domestic product (GDP) of approximately US$18 trillion and a population of approximately 324.5 million, is one of the world's largest real estate markets. The GDP of six of its constituent states alone would, if each were treated as an independent economy in its own right, rank within the top 20 globally.

Notwithstanding this, the US real estate market remains highly fragmented. The top five states by residential sales volume units as an example (California, Texas, Florida, Illinois and Ohio) represent, on average, approximately 25 per cent of the total residential real estate transaction volume (5,450,000 in 2016 - over five times as many as in the UK). This fragmentation is demonstrated by the fact the market is comprised largely of individual realtors - with the US Association of Real Estate License Law Officials recording more than 2 million licensed estate agents. The Company's management estimates that total real estate commission income in the US is in the range of c. US$70 billion annually (compared with US$4.3 billion in the United Kingdom).

The Company believes that the Purplebricks platform and business model is scalable and can be adapted to the US market. Given the many comparable trends, sentiment and similarities between the property markets in the US, the UK and Australia, the Company's expansion strategy will be shaped significantly by the Company's experiences with its successful UK and more recent Australian operations.  Although the Company initially intends to strategically roll out across a defined number of US states, the US as a whole represents a significant opportunity for future growth in the longer term.

Despite the many similarities, the US market does have some process aspects which are different from the markets in which the Company currently operates. In the US, the sale of residential property is typically conducted through a Listing Agent (sell side) and a Buying Agent (buy side). The Listing Agent will agree with the seller a commission (typically up to 7 per cent of the sale price) and list the property on a Multiple Listing Service (MLS). The primary purpose of an MLS is to provide a facility for Listing Agents to publish all of their listings, enabling Buying Agents to introduce potential buyers for the property. The Listing Agent may also act as the Buying Agent by introducing buyers to its own listings.

In listing a property on an MLS, the structure of the US market is such that the Listing Agent will offer potential third party Buying Agents a share of the Listing Agent's negotiated commission (typically 2 - 3 per cent of the property's sale price). However, should the Listing Agent also introduce the buyer to the property that it has listed, then the Listing Agent effectively acts as a Dual Agent (i.e. Listing Agent and Buying Agent) and retains the entire commission negotiated with the seller. Accordingly, the nature of the US system is such that every real estate agent is entitled to advertise the properties of the other real estate agents (who are part of an MLS) on their own website and act as Buying Agent by making introductions.

The structure of the US residential property market, therefore, presents a significant revenue opportunity for the Company, as estate agents in the US can earn revenue from selling a property as Listing Agent and additional revenue from introducing buyers to properties for which they act as Listing Agent (thereby retaining the entire commission by acting for both sell-side and buy-side) or by acting as Buying Agent and selling other Listing Agents' properties which are on an MLS.

Details of the Company's proposed strategic expansion into the United States

The Directors consider that there is now a significant opportunity to make a meaningful and lasting impact on the US real estate market. It is intended that, initially, the Company will strategically roll out in a defined number of US states, launching in the second half of 2017, before rolling out more widely across other states. The initial expansion into the US is to be funded from the net proceeds of the Placing and will be led by US Chief Executive Officer, Eric Eckardt, supported by Founder and Group CEO Michael Bruce and his brother and co-founder Kenny Bruce. Eric has more than 20 years of experience in real estate, finance and technology.

The Company will look to attract some of the most experienced real estate agents in the US property industry who want to run their own businesses, as many of Purplebricks' existing LPEs do. The Directors believe that real estate agents in the US will want to become LPEs, given the compelling customer proposition and the benefits of the Purplebricks model. The Purplebricks model should allow agents to spend more time focusing on looking after customers and selling homes, rather than a significant proportion of their time being taken up prospecting for the next listing. This is possible because a sustained marketing and advertising campaign is intended to drive listing appointments to the LPEs (see below). The Purplebricks platform and business model is designed to result in improved LPE productivity which provides LPEs the opportunity to earn more revenue than they would as a traditional real estate agent.

As with the Company's other markets, LPEs will undergo a rigorous recruitment and training program. It is intended that LPEs will be granted territory on a zip-code by zip-code basis, providing them with an exclusive region within which to operate on behalf of Purplebricks. They can then build and grow their territory by engaging other agents (subject to Purplebricks' recruitment and training) to act as LPEs within their territory and earn income from each of them and create future capital value for their own businesses.

The Company's technology should help to ensure that Purplebricks delivers a high quality service to customers. The Purplebricks platform will, once rolled out, provide US customers, LPEs, Listing Agents and Buying Agents with a reliable means of engaging in the process of buying and selling real estate at all times of the day and night. Through a dedicated dashboard and platform, buyers and sellers would be able to appoint Purplebricks, book a listing appointment and arrange showings (viewings), approve property listing particulars and advertisements, receive feedback after showings, access information and advice, receive and negotiate offers and agree a sale. The platform is designed to be accessible 24 hours a day, seven days a week and often with the click of a button. Buyers, sellers, LPEs, Listing Agents and Buying Agents will be able to safely and securely communicate with one another through the Purplebricks platform or, if they wish, communicate with Purplebricks. The Purplebricks model is intended to make LPEs, Listing Agents and Buying Agents more productive and for the customer's journey to be more convenient, transparent and cost effective.

The net proceeds of the Placing will be used to adapt Purplebricks' platform and technology to meet the specific characteristics of the US market meet the needs and requirements of consumers and to address the buy side and sell side commission system that operates there. In particular, it is intended that the Purplebricks platform will have a fully integrated data feed from the MLS that will provide Purplebricks.com with an active market inventory. This will enable homebuyers to search all market properties, acting as a funnel to capture buy-side opportunities for the Company. Through a cooperation agreement via an MLS, the Directors believe the Company could be paid a 2 - 3 per cent buy-side commission for introducing successful buyers to other Listing Agent's properties.

Further, Purplebricks has one of the largest databases of homemovers in the UK. The Directors intend to build the same in the US and make use of the Company's customer facing technology to create more revenue opportunities for the business.

The recruitment and training of local LPEs and the adaptation of the Purplebricks platform and business model for the US will be coupled with an advertising and marketing strategy built upon the Company's successful brand lead strategies in the UK and Australia. The Directors consider advertising and marketing to have played a significant part in the growth of the Company's existing business, with Purplebricks having become the most recognised real estate agency brand in the UK property market in less than three years. 

It is intended that there will be a detailed marketing strategy to secure:

(a)      listings for Purplebricks;

(b)      buy side activity for Purplebricks properties; and

(c)      buy side activity for other Listing Agents' listings.

A number of key advertising mediums are expected to play a key part in building a trusted brand that is capable of resonating locally. The Company's media mix will be variable across markets. More tactical media could be used to supplement broadcast acquisition and can be quickly scaled up or down as required to generate listing opportunities. An "always on" approach to broadcast media will be used to generate demand which should encourage organic momentum. The Directors believe that there will also be further opportunities to invest in lead generation through subscribing to leading listing portals.

The Directors believe that Purplebricks' advertising and marketing strategy will attract sellers and buyers. Once attracted to Purplebricks.com, they will be able to undertake a search of most of the market (Purplebricks listings and those of other Listing Agents). It is expected that those sellers and buyers will use the Purplebricks website to arrange viewing or listing appointments, whether or not those listings are Purplebricks.com listings or those of another Listing Agent.

The development of the customer journey will be constantly monitored with a view to ensuring an increase in conversion rates and a reduction in the overall cost per acquisition.

Details of the Placing

The Bookbuild will open with immediate effect following this announcement. The Company has entered into the Placing Agreement with each of the Joint Bookrunners on customary terms and conditions pursuant to which, subject to the conditions set out in the Placing Agreement, each of the Joint Bookrunners agreed to use its reasonable endeavours (as agents for the Company) to procure Placees for the Placing Shares at the Placing Price.

The number of Placing Shares will be determined by the Joint Bookrunners in consultation with the Company at the close of the Bookbuild. The timing of the closing of the Bookbuild, pricing and allocations are at the discretion of the Joint Bookrunners in consultation with the Company.  Details of the number of Placing Shares will be announced as soon as practicable after the closing of the Bookbuild.

The obligations of each of the Joint Bookrunners under the Placing Agreement in respect of the Placing Shares are conditional upon, inter alia, the Resolutions being duly passed at the General Meeting and Admission becoming effective on or before 8.00 a.m. on 14 March 2017 (or such later time and date as the Company and each of the Joint Bookrunners shall agree, not being later than 8.00 a.m. on 24 March 2017).

The Placing Agreement contains provisions entitling the Joint Bookrunners to terminate the Placing Agreement at any time prior to Admission in certain circumstances.  If this right is exercised or if the conditionality in the Placing Agreement is not satisfied, the Placing will not proceed.

The Company has agreed to pay the Joint Bookrunners certain placing commissions together with reimbursement of certain costs and expenses incurred in connection with the Placing.

Application will be made for the Placing Shares to be admitted to trading on AIM.  Subject to the Resolutions being passed at the General Meeting, it is expected that Admission of the Placing Shares will become effective and that dealings will commence in the Placing Shares at 8.00 a.m. on 14 March 2017.

The Placing Shares, when issued and fully paid, will rank pari passu in all respects with the Existing Ordinary Shares and will rank for all dividends or other distributions declared, made or paid after the date of issue of the Placing Shares. 

General Meeting and circular to Shareholders

It is not expected that the Company's existing share issuance authorities will be sufficient for the issue of the Placing Shares pursuant to the Placing and therefore the General Meeting will be held to seek Shareholder approval to grant authorities to the Directors to allot further shares for cash on a non-pre-emptive basis (i.e. the Resolutions). A circular, together with a notice convening the General Meeting, will be sent to Shareholders tomorrow, 23 February 2017.  It is expected that the General Meeting will be held on 13 March 2017 and that the Placing Shares will be issued shortly thereafter, subject to Admission. 

The Directors consider the Placing to be in the best interests of the Company and Shareholders as a whole and accordingly unanimously recommend Shareholders vote in favour of the Resolutions to be proposed at the General Meeting as they intend to do in respect of their own beneficial holdings and the shareholdings in which they are interested amounting, in aggregate, to 61,952,098 ordinary shares, representing approximately 25 per cent of the ordinary shares as at the date of this document. The Company's largest shareholder, Woodford, has also indicated to the Company its intention, subject to the outcome of the Bookbuild, to provide an irrevocable undertaking to vote in favour of the Resolutions.

Current trading and operational update

With a few key months remaining ahead of us, the Board is pleased with the progress the Company is making and confirms that it is trading in line with the Board's expectations for the financial year ending 30 April 2017.

United Kingdom - building upon our achievements

In less than three years, Purplebricks has become the most recognised brand in the UK property market having become known for being a fair, modern and transparent way to sell a property. To date, over £6 billion in residential property has been sold via the Purplebricks platform in the UK alone. These achievements have given the Company, according to data from Rightmove, a 67% share of new instructions for the online real estate market in the UK. The Purplebricks website now receives over 1.45 million visits per month.

Australia - shaking up an industry

The Company launched its business into the Australian market in September 2016 and now services Queensland, Victoria and New South Wales. The Purplebricks platform is expected to be launched in Adelaide and Perth in March and April 2017, respectively. Growth in the Company's Australian operations has occurred faster than any UK regional launch, and the number of LPEs has quickly grown to over 50.

Despite being Australia's seasonal month for holidays, January 2017 was a record month for new property instructions for the Company. With average revenue per listing exceeding A$5,000, the Company estimates that Australian customers save an average of over A$12,000  in estate agents' fees when compared with a traditional commission structure (saving homeowners millions of dollars since Purplebricks entered the market five months ago). The Company has a strong management team in Australia and Purplebricks has achieved a 9.5 out of 10 ("excellent") rating with 98% positive reviews on Trustpilot.

Enquiries:

Purplebricks                                                                                               [phone]
Michael Bruce, Neil Cartwright

Zeus Capital                                                                                               [phone]
Ben Robertson, Nicholas How, John Goold

Peel Hunt                                                                                                   [phone]
Dan Webster, Jock Maxwell Macdonald, George Sellar

Investec                                                                                                     [phone]
Keith Anderson, Carlton Nelson, Neil Coleman

Instinctif Partners                                                                                       [phone]
David Simonson, Mark Reed

The person responsible for arranging for the release of this announcement on behalf of the Company is Neil Cartwright, Chief Financial Officer.

Important information

This announcement is for information purposes only and does not itself constitute an offer or invitation to underwrite, subscribe for or otherwise acquire or dispose of any securities in the Company and does not constitute investment advice.

Neither this announcement nor any copy of it may be taken or transmitted, published or distributed, directly or indirectly, into the United States, Australia, Canada, Japan, Jersey or South Africa or to any persons in any of those jurisdictions or any other jurisdiction where to do so would constitute a violation of the relevant securities laws of such jurisdiction. Any failure to comply with this restriction may constitute a violation of United States, Australian, Canadian, Japanese or South African securities laws. The distribution of this announcement in other jurisdictions may be restricted by law and persons into whose possession this announcement comes should inform themselves about, and observe any such restrictions.

This announcement does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for any Shares or other securities in the United States (including its territories and possessions, any state of the United States and the District of Colombia (the United States or US)), Australia, Canada, Japan, Jersey or South Africa or in any jurisdiction to whom or in which such offer or solicitation is unlawful. The Placing and the distribution of this announcement and other information in connection with the Placing in certain jurisdictions may be restricted by law and persons into whose possession this announcement, any document or other information referred to herein, comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. Neither this announcement nor any part of it nor the fact of its distribution shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract or commitment whatsoever.

In particular, the securities of the Company (including the Placing Shares) have not been and will not be registered under the US Securities Act of 1933, as amended (the Securities Act), or under the securities laws or with any securities regulatory authority of any state or other jurisdiction of the United States, and accordingly the Placing Shares may not be offered, sold, pledged or transferred, directly or indirectly, in, into or within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the securities laws of any relevant state or jurisdiction of the United States. There is no intention to register any portion of the offering in the United States or to conduct a public offering of securities in the United States.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this announcement. Any representation to the contrary is a criminal offence in the United States.

Zeus Capital Limited (Zeus Capital) is authorised and regulated in the United Kingdom by the FCA and is acting as nominated adviser and joint bookrunner to the Company in respect of the Placing. Peel Hunt LLP (Peel Hunt) is authorised and regulated in the United Kingdom by the FCA and is acting as joint bookrunner to the Company in respect of the Placing. Investec Bank plc (Investec), which is authorised in the United Kingdom by the Prudential Regulatory Authority (PRA) and is regulated in the United Kingdom by the PRA and the FCA, is acting as joint bookrunner to the Company in respect of the Placing. Each of Zeus Capital, Peel Hunt and Investec is acting for the Company and for no-one else in connection with the Placing, and will not be treating any other person as its client, in relation thereto and will not be responsible for providing the regulatory protections afforded to its customers nor for providing advice in connection with the Placing or any other matters referred to herein and apart from the responsibilities and liabilities (if any) imposed on Zeus Capital, Peel Hunt or Investec, as the case may be, by Financial Services and Markets Act 2000 (as amended) (FSMA), any liability therefor is expressly disclaimed. Any other person in receipt of this Circular should seek their own independent legal, investment and tax advice as they see fit.

Forward-looking statements

Certain information contained in this announcement constitute forward looking information. This information relates to future events or occurrences or the Company's future performance. All information other than information of historical fact is forward looking information. The use of any of the words "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "should", "believe", "predict" and "potential" and similar expressions are intended to identify forward looking information. This information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward looking information. No assurance can be given that this information will prove to be correct and such forward looking information included in this announcement should not be relied upon. Forward-looking information speaks only as of the date of this announcement.

The forward looking information included in this announcement is expressly qualified by this cautionary statement and is made as of the date of this announcement. The Company does not undertake any obligation to publicly update or revise any forward looking information except as required by applicable securities laws.

Appendix I - Risk Factors

An investment in the Placing Shares is subject to a number of risks. Before making an investment decision with respect to the Placing Shares, prospective investors should carefully consider the risks associated with an investment in the Company, the Company's business and the industry in which the Company operates, in addition to all of the other information set out in this document and, in particular, those risks described below.

If any of the circumstances identified in the risk factors were to materialise, the Company's business, financial condition, results of operations and future prospects could be adversely affected and investors may lose all or part of their investment. Certain risks of which the Directors are aware at the date of this announcement and which they consider material to prospective investors are set out in the risk factors below. Additional risk factors which the Directors consider may be relevant to the Company's business can be found in the Company's Admission Document dated 3 December 2015. Copies of the Admission Document can be obtained on the Company's website at www.purplebricks.com/investors/. However, further risks and uncertainties relating to the Company which are not currently known to the Directors, or that the Directors do not currently deem material, may also have an adverse effect on the Company's business, financial condition, results of operations and future prospects. If this occurs, the price of the Ordinary Shares may decline and investors may lose all or part of their investment.

An investment in the Company may not be suitable for all potential investors. Potential investors are therefore strongly recommended to consult an independent financial adviser authorised under FSMA and who specialises in advising upon the acquisition of shares and other securities before making a decision to invest.

Risks relating to the Company's business and its industry

The Company may fail to implement its strategy to successfully enter into and disrupt the US market which may have an adverse impact on its business, financial and other conditions, profitability and results of operations

There is no guarantee that the Company will be successful in its strategy to enter the US real estate market. The US estate agency market is highly fragmented and the Company will face competition in this market from other parties, including those parties who have larger capacity and scale than the Company and those who already have an established presence and/or reputation in the market. The Company's proposed operations in the US will be subject to different federal and state laws, regulations, rules and industry and other applicable standards and codes of conduct which may limit the extent to which the Company's business model may be operated in the US in the manner it has in the UK or in Australia or the Company's ability to establish US operations.  Furthermore, the Company may experience constraints in its ability to enter the US market or to operate its business within the framework in which the US real estate agency industry operates. In addition, the Company may be unable to achieve its proposed US expansion, or any related milestones, in accordance with its proposed timeline for doing so. Any delay in achieving such targets may impact of the success of the proposed launch into the US. There is therefore no assurance that the Company will be successful in implementing its US strategy and may not be able to generate any return on the net proceeds of the Placing invested in pursuing such expansion strategy.

As the Company's business expands into the US, it will need to add new personnel (including LPEs) to service the Company's US operations. The Company's success in the US will be highly dependent on its ability to identify, hire, train, motivate and retain LPEs. Competition for such personnel in the property sector can be intense and the Company cannot give assurances that it will be able to attract or retain such personnel in the future. The Company's inability to attract and retain sufficient LPEs may adversely affect its future growth, profitability and the success of the Company's expansion into the US.

The successful execution of the Company's expansion strategy into the US depends on the services of some of its key management personnel and, in particular, on the services of Michael Bruce and Kenny Bruce. Some key management may need to direct a significant share of their time and attention to the expansion of the Purplebricks brand in the US, which may result in them dedicating less time to the Company's existing businesses in the United Kingdom and Australia.  In addition, should the Company be unable to replicate strong key management teams who can promote, and generate confidence in, the Purplebricks brand in other markets in which it is seeking to expand, then the Company may find it more difficult to experience the success in those markets which it has experienced in the United Kingdom and Australia.

The Company's anticipated expansion strategy into the US may also place significant demands on its management, administrative, operational, IT, financial and other resources. To be successful in managing its expansion strategy, the Company will need to continue to maintain, develop and integrate its management, administrative, operational, financial and accounting systems, internal controls and supervisory procedures. As the Company's operations expand, it may also be required to incur further expenditure and effort to invest in its IT systems and infrastructure. Although the Company's management, administrative, operational, financial and accounting systems and internal controls and supervisory procedures have been designed to be scalable and to support its anticipated expansion strategy, there can be no assurance that they will be suitable or perform as designed.

The Company's market share and business position in the United States, the United Kingdom and Australia may be adversely affected by economic, political and market factors beyond the Company's control

The expansion of the Company's business into the US following the Placing will further expose the Company to economic conditions and any downturns in that market to which it was not previously directly exposed. The Company will also continue to have very significant exposure to the UK and Australian markets in which it already operates.

The markets in which the Company operates, or intends to operate, are directly affected by many national and international factors that are beyond its control. Any of the following factors, among others, may cause a substantial decline in the markets in which the Company offers, or intends to offer, its services: economic, stock market and political conditions, including UK, Australian and US monetary policy; the level and volatility of the UK, Australian and US property markets; concerns about inflation; changes in consumer confidence levels; legislative and regulatory changes; natural disasters and epidemics; and concerns about terrorism and war. Worsening or volatile economic or political conditions could impact consumer confidence and the property market and hence the demand for the Company's services or could impact on the ability of the Company to operate its business in markets in which it operates or intends to operate.

Uncertain economic prospects or a decline in the financial and/or property markets globally or in any of the United Kingdom, Australia or the US could:

(a)      adversely affect the performance of the Company and its reputation;

(b)      result in a deterioration of the Company's competitive position and a reduction in the overall level of its business; and

(c)      lead to a failure to win new business.

Accordingly, any of these factors could have a material adverse effect on the Company's business, sales, results of operations, financial condition and growth prospects.

The United Kingdom's proposed exit from the European Union (EU)

A referendum was held on 23 June 2016, the result of which was a vote in favour of the UK leaving the EU (Brexit). The extent of the impact of Brexit on the Company will depend in part on the nature of the arrangements that are put in place between the UK and the EU following the eventual Brexit and the extent to which the UK continues to apply laws that are based on EU legislation. The Company may be subject to a significant period of uncertainty in the period leading up to eventual Brexit including, inter alia, uncertainty in relation to any potential regulatory or tax changes. In addition, the macroeconomic effect of an eventual Brexit on the UK property market is unknown. Brexit could also create significant UK (and potentially global) stock market uncertainty, which may have a material adverse effect on the price of the Ordinary Shares. As such, it is not possible to accurately state the impact that Brexit will have on the Company, or demand for the Company's services, at this stage. Brexit may also increase the regulatory compliance burden on the Company. This could restrict the Company's future activities and thereby negatively affect returns.

Volume of property transactions

Any reduction in sales instructions as a result of reductions in volume of residential properties built or available could have a material adverse effect on the Company's business, prospects, results of operations and financial condition.

Changes in government policy in any of the markets where the Company operates or will operate, and any laws or regulations implementing any policy changes, which result in increased costs involved in selling or letting residential property, may reduce volumes of sales and/or lettings transactions. In addition, any increase in rates of stamp duty land tax, or the introduction of any new tax based on the ownership of high value properties may reduce volumes and/or values of property sales transactions. In particular, economic and housing policy in the US remains uncertain following recent elections. Such changes could have a material adverse effect on the Company's business, prospects, results of operations and financial condition.

The Company's business is dependent on the availability and affordability of mortgage financing

Many residential property sales transactions in the United Kingdom, Australia and the US rely on mortgage financing. Any reduction in mortgage loan availability, due to (i) macroeconomic factors (such as constrained wholesale funding markets, the de-leveraging of lenders' balance sheets or a more conservative attitude to risk by lenders), (ii) changes in lenders' lending criteria (including requirements for increased mortgage deposits from borrowers) and approval processes or the withdrawal of mortgage products, (iii) new regulations (such as regulations increasing the capital requirements of lenders) or (iv) any other reasons, could result in a decrease in volumes of residential property sales transactions.

Any perception by prospective property buyers that interest rates on mortgage products could increase in the future may result in a reluctance of prospective property buyers to incur mortgage debt to finance a residential property purchase.

Any reduction (or perceived reduction) in mortgage loan availability or in the affordability of mortgage products for prospective property buyers could result in a decrease in volumes of residential property sales transactions which may reduce the Company's rate of instructions or impact on its ability to establish or grow its US business.

Limited financial history and revenue and profitability

The Company has a relatively limited historical financial track record and whilst it continues to achieve growth in revenues, there have been significant operating cash outflows and it has not yet achieved a profit on its operations. The Company's strategic growth plans through expansion into the US property market is also expected to involve significant operating cash outflows and capital investment, which is likely to exceed the net proceeds of the Placing received by the Company. There can be no assurance that the Company will be able to sustain revenue growth and achieve or sustain profitability in the future. If the Company is unable to achieve or sustain profitability, the business could be severely harmed. Further, the Company's operating results may fluctuate as a result of a number of factors, many of which are beyond its control. If the Company does not achieve revenue growth and/or profitability, it may require additional financing, which may not be available.

Other risks relating to the Company's business

The Company is subject to laws and regulations with which it may be found to be non-compliant

The Company operates a market-disrupting business model and is subject to laws, regulations, rules and industry and other applicable standards and codes of conduct which may not have been developed with such a business model in mind. Accordingly, there is a greater risk of challenge to, or regulatory investigation of, the Company's and LPEs' compliance with such laws, regulations, rules and industry and other applicable standards and codes of conduct than there would be with a more traditional estate agency structure.  Any such challenges may adversely affect the operations of the Company or impact upon its reputation. Changes in such laws, regulations or industry standards and codes of conduct may increase the costs or reduce the profitability of providing the Company's services or may affect the Company's ability to operate its business model in the same manner.

The Company is or will be subject to laws and regulation and supervision by regulators in each of the United Kingdom, Australia and the US. Regulators typically can conduct industry-wide investigations into the business of firms supervised by that regulator. Such investigations can follow adverse publicity in respect of another participant in the same industry as the Company and might not necessarily result from any action or omission by the Company. A regulator may determine that the Company has failed to comply with applicable laws, regulations, rules and industry and other applicable standards and codes of conduct or that it has applied such laws, regulations, rules and industry and other applicable standards and codes of conduct to its business model in a manner with which a regulator disagrees. The impact of the Company being found to be non-compliant in any such inquiry and/or investigation is difficult to assess or quantify and would depend on which regulatory regime was involved and the disciplinary/enforcement powers of the regulator responsible for the supervision of that particular business. Such inquiries or investigations could result in adverse publicity for, or negative perceptions being created regarding, the Company and affect the Company's relationships with regulators and current and potential clients, as well as diverting management's attention. Such action could also subject the Company to additional remediation costs to redress non-compliance, which in turn could have a material adverse effect the Company's business, prospects, results of operations and financial condition.

The Company's governance processes and internal systems and controls may not be sufficient to accommodate rapid growth and expansion in Purplebricks' operations, including in terms of the number of LPEs and the number of markets in which it operates. As a publicly traded company, Purplebricks is subject to a higher degree of expectation in terms of governance and internal systems and controls than applied to it prior to its listing on AIM, as well as an increased and more burdensome regulatory framework by virtue of that listing.

The Company relies upon, may be responsible for or may receive criticism for, the actions of its Directors, employees and LPEs and their sub-licensees in carrying on its business. Acts or omissions of the Directors, the Company's employees and LPEs (including employee or sub-licensee negligence, fraud and other misconduct) could result in failures by the Company to comply with applicable laws, regulations, rules or industry standards and codes of conduct, or requirements imposed or supervised by a regulator, which could lead to onerous requests for information, prosecution, disciplinary action, imposition of fines or the revocation of a permission or authorisation, and could result in adverse publicity for, or negative perceptions being created regarding, the Company and affect the Company's relationships with regulators and its current and potential clients and applicants, as well as diverting management's attention. Any of these outcomes could have a material adverse effect on the Company's business, prospects, results of operations and financial condition.

The Company's business model which is carried on through LPEs exposes the Company to certain additional risks

The Company carries on its operations through a business model of LPEs. Most of the LPEs are not employees of the Company. The Company retains legal responsibility in respect of the services provided to customers but day to day interaction with such customers will be through the LPEs who typically operate from separate business premises. Whilst the terms of the LPE Licence Agreements set out the contractual responsibilities of the LPEs and their sub-licensees and employees and entitle the Company to terminate such appointments in the event of certain breaches, the Company retains responsibility to the customer and is exposed to consequential risk. Any claim brought by a customer against the Company may result in financial loss and could have an adverse effect on the Company's business, results of operations, financial condition and reputation.

The Company's ability to operate its business model in a similar manner in the US will be subject to applicable US law and regulation.

Whilst the Company seeks to protect itself contractually, including through the terms of its LPE Licence Agreements, its rights against the LPE are dependent upon the successful enforceability of such contracts. Failure to enforce, or recover under any such contracts could have an adverse effect on the Company's business, results of operations and financial condition.

In the event of a termination of a LPE Licence Agreement, there is a risk that an individual employed by such LPE could seek to argue that they are an employee of the Company, thus asserting potential employment related claims.

The Company's growth strategy and business model are market disrupting, and the Company may be subject to challenge from various third parties

The Company is disrupting an industry that has otherwise seen little change for many years. The consequence of this is that there is a risk that groups of traditional estate agents who feel threatened by the Company's business model, rapid growth and ability to compete on price will resist the Company's expansion. Such resistance from traditional industry participants has been seen in other industries that are experiencing rapid transitions in business models, such as transportation (e.g. Uber and local taxi associations), accommodation (e.g. Airbnb and the hotel industry) and music (e.g. Spotify and the record industry).

As with other rapidly changing industries, some of the regulatory and competitive frameworks are having to adapt and catch-up. There is greater risk than with traditional businesses that regulators, competitors or others with vested interests may challenge the Company and its business model. Challenges to the Company and its business model, even if unsuccessful or proven to be untrue, could harm the Company's reputation and ability to generate instructions. Such challenges are also demanding on management time and attention, which can further affect the Company's business and the implementation of its growth strategies.

The Company has, for example, been subject to the dissemination of misleading statements or information which are designed to cause, or may have the effect of causing, reputational damage even if not true. Certain of such statements or information have been reported in the press. The Company's brand is important to its business model and reputational damage may cause financial harm to the Company.

Litigation and other adversarial actions in the ordinary course of business could materially adversely affect the Company

The Company may be subject to litigation, disputes, claims and complaints, including adversarial actions, by clients, current or former LPEs, employees, suppliers, insurers, regulators, competitors and others in the ordinary course of business. There is a risk that the nature of the Company's market disrupting business model and fast growing business may make litigation or other adversarial actions more likely than for companies operating a more traditional model or growing at a slower rate.

The Company may require additional capital in the longer term, depending on factors such as regulatory changes or the pursuit of its growth strategy. Such additional capital may not be available or may only be available on unfavourable terms

The Company's capital requirements depend on numerous factors, including working capital. If its capital requirements in the longer term were to vary materially from those which the Directors currently anticipate, or if the Company requires significantly more capital for its expansion than currently anticipated (including amounts raised pursuant to the Placing), the Company might require financing. In order to be able to make the necessary payment, the Company may need to obtain borrowing facilities or seek to raise funds in the capital markets, failing which it would have to raise additional capital from Shareholders. There can be no assurance that the Company will be able to raise additional funds, whether in the form of debt or equity, when needed or that such funds will be available on terms favourable to it.

A number of factors (including conditions in the credit, debt and equity markets and general economic conditions) may make it difficult for the Company to obtain additional financing or raise capital on favourable terms or at all. If, in the longer term, the Company fails to raise additional funds when needed or to obtain such funds on favourable terms, it could have a material adverse effect on the Company's business, results of operations, financial condition and growth prospects.

Risks Relating to the Ordinary Shares

Investment in AIM securities

Although the Ordinary Shares are, and the Placing Shares will be, admitted to trading on AIM, there can be no assurance that an active trading market in the Ordinary Shares will exist or be maintained.  An investment in shares traded on AIM is perceived to involve a higher degree of risk and to be less liquid than investment in companies whose shares are listed on the Official List and traded on the London Stock Exchange's main market for listed securities. An investment in Ordinary Shares may be difficult to realise. Prospective investors should be aware that the value of Ordinary Shares may go down as well as up and that the market price of the Ordinary Shares may not reflect the underlying value of the Company. Investors may, therefore, realise less than, or lose all of, their investment.

Potentially volatile share price and liquidity

The Placing Price may not be indicative of the market price for the Placing Shares following Admission. The share price of quoted companies at the stage of development of the Company can be highly volatile and shareholdings illiquid. The price at which the Ordinary Shares are quoted and the price which investors may realise for their Ordinary Shares may be influenced by a significant number of factors, some specific to the Company and its operations and some which affect quoted companies generally. These factors could include the performance of the Company, large purchases or sales of Ordinary Shares, legislative or regulatory changes affecting the Company's operations (whether in the United Kingdom, Australia or the US), and general, economic, political or regulatory conditions as well as changes in sentiment in the market regarding the Company, the sector or equities generally, business developments of the Company and/ or its competitors, the operating and share price performance of other companies in the industries and markets in which the Company operates, news reports relating to trends in the Company's markets or the wider economy, defamatory statements or public criticism of the Company which damages its reputation and the publication of research analysts' reports regarding the Company or the sector generally.

Share price effect of sales of Ordinary Shares

There can be no assurance that certain Directors or other Shareholders will not elect to sell their Ordinary Shares.  The market price of Ordinary Shares could decline as a result of any such sales of Ordinary Shares or as a result of the perception that these sales may occur.  In addition, if these or any other sales were to occur, the Company may in the future have difficulty in offering Ordinary Shares at a time or at a price it deems appropriate.

The Company's ability to pay dividends in the future depends, amongst other things, on the Company's financial performance and capital requirements and is therefore not guaranteed

The Company has not yet paid a dividend. The Company's ability to pay dividends in the future depends, amongst other things, on the Company's financial performance and capital requirements and is therefore not guaranteed. Under English law, a company can only pay cash dividends to the extent that it has distributable reserves and cash available for this purpose. In addition, the Company may not pay dividends if the Directors believe this would cause the Company to be inadequately capitalised (or if, for any other reason, the Directors conclude it would not be in the best interests of the Company). Any of the foregoing could limit the payment of dividends to Shareholders or, if the Company does pay dividends, the amount of such dividends.

Issuance of additional Ordinary Shares

Although the Company's business plan does not currently involve the issuance of Ordinary Shares other than in connection with the Placing, it is possible that the Company may decide to issue, pursuant to a public offer or otherwise, additional Ordinary Shares in the future at a price or prices higher or lower than the Placing Price.  An additional issue of Ordinary Shares by the Company, or the public perception that an issue may occur, could have an adverse effect on the market price of Ordinary Shares and could dilute the proportionate ownership interest, and hence the proportionate voting interest, of Shareholders if, and to the extent that, such an issue of Ordinary Shares is not effected on a pre-emptive basis or Shareholders do not take up their rights to subscribe for further Ordinary Shares as a pre-emptive offer.

Pre-emptive rights may not be available for US and other non-UK Shareholders

The Placing, whilst conditional on the approval of Shareholders, is not being made on a pre-emptive basis. The proportionate ownership and voting interest in the Company of existing Shareholders will be reduced pursuant to the Placing. In the case of an increase in the share capital of the Company for cash, the Shareholders are generally entitled to pre-emption rights pursuant to the Act unless such rights are waived by a special resolution of the Shareholders at a general meeting or pursuant to a general waiver obtained at an annual general meeting, and such an issue could dilute the interests of the Shareholders. To the extent that pre-emptive rights are applicable, US and certain other non-UK Shareholders may not be able to exercise pre-emptive rights for their Ordinary Shares unless the Company decides to comply with applicable local laws and regulations and, in the case of US Shareholders, unless a registration statement under the US Securities Act is effective with respect to those rights or an exemption from the registration requirements thereunder is available. The Placing Shares to be issued will not be registered under the US Securities Act. Shareholders who have a registered address, or who are resident in, or who are citizens of, countries other than the United Kingdom should consult their professional advisers about whether they require any governmental or other consents or need to observe any other formalities to enable them to acquire Placing Shares.

Appendix II - Terms and Conditions of the Placing

IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY.

THIS ANNOUNCEMENT, INCLUDING THE APPENDICES (TOGETHER THE "ANNOUNCEMENT") IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, JERSEY THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTENDED THAT IT WILL BE SO APPROVED.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THESE TERMS AND CONDITIONS ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED PLACEES AS DEFINED IN SECTION 86(7) OF THE FSMA, AS AMENDED (''QUALIFIED PLACEES''), BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE PROSPECTUS DIRECTIVE INCLUDING ANY RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER STATE; (B) IN THE UNITED KINGDOM, QUALIFIED PLACEES WHO ARE PERSONS WHO: (I) FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE ''ORDER''); (II) FALL WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC) OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS ''RELEVANT PERSONS''). THESE TERMS AND CONDITIONS MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THESE TERMS AND CONDITIONS RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN PURPLEBRICKS GROUP PLC.

EACH PLACEE SHOULD CONSULT WITH ITS ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.  THE DISTRIBUTION OF THIS ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT MAY BE RESTRICTED BY LAW IN CERTAIN JURISDICTIONS, AND ANY PERSON INTO WHOSE POSSESSION THIS ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, SUCH RESTRICTIONS.

Furthermore, the Placing Shares may not be offered or sold in the United States absent (A) registration under the US Securities Act of 1933, as amended (the "US Securities Act") or (B) an available exemption from registration under the US Securities Act. The Placing Shares have not been, and will not be, registered under the US Securities Act and will be offered only (A) to investors located outside of the United States in "offshore transactions" as defined in and in accordance with Regulation S, or (B) within the United States to a limited number of "qualified institutional buyers" (as defined in Rule 144A under the Securities Act ("QIBs")) who are also "Major  Institutional US Investors" (within the meaning of Rule 15a-6 under the US Exchange Act of 1933, as amended ("MIIs"), who have executed and delivered a US investor representation letter addressed to PURPLEBRICKS Group plc and the Joint Bookrunners in transactions exempt from, or not subject to, the registration requirements under the US Securities Act.

No action has been taken by Purplebricks Group plc, Investec Bank plc ("Investec"), Zeus Capital Limited ("Zeus Capital") and Peel Hunt LLP ("Peel Hunt") (together the "Joint Bookrunners") or any of their respective Associates that would permit an offer of the Placing Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. 

This Announcement or any part of it does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States (including its territories and possessions, any state of the United States and the District of Columbia), Canada, Australia, the Republic of South Africa, Japan, Jersey or any other jurisdiction in which the same would be unlawful.  No public offering of the Placing Shares is being made in any such jurisdiction.

All offers of the Placing Shares will be made pursuant to an exemption under the Prospectus Directive from the requirement to produce a prospectus.  In the United Kingdom, this Announcement is being directed solely at persons in circumstances in which section 21(1) of the Financial Services and Markets Act 2000 (as amended) (the "FSMA") does not apply.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this Announcement.  Any representation to the contrary is a criminal offence in the United States.  The relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada, no prospectus has been lodged with, or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; the relevant clearances have not been, and will not be, obtained for the South Africa Reserve Bank or any other applicable body in the Republic of South Africa in relation to the Placing Shares and the Placing Shares have not been, nor will they be, registered under or offering in compliance with the securities laws of any state, province or territory of Australia, Canada, Japan, Jersey or the Republic of South Africa.  Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into Australia, Canada, Japan, Jersey or the Republic of South Africa or any other jurisdiction outside the United Kingdom.

Persons (including, without limitation, nominees and trustees) who have a contractual right or other legal obligations to forward a copy of this Announcement should seek appropriate advice before taking any action.

This Announcement should be read in its entirety.  In particular, you should read and understand the information provided in this "Important Information" section of this Announcement.

By participating in the Placing, each person who is invited to and who chooses to participate in the Placing (a "Placee") will be deemed to have read and understood this Announcement in its entirety, to be participating, making an offer and acquiring Placing Shares on the terms and conditions contained herein and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in this Appendix.

In particular, each such Placee represents, warrants, undertakes, agrees and acknowledges (amongst other things) to Purplebricks Group plc and the Joint Bookrunners that:

1.   it is a Relevant Person and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

2.   in the case of a Relevant Person in a member state of the EEA which has implemented the Prospectus Directive (each, a "Relevant Member State") who acquires any Placing Shares pursuant to the Placing:

a.   it is a Qualified Investor within the meaning of Article 2(1)(e) of the Prospectus Directive; and

b.   in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive:

i. the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than Qualified Investors or in circumstances in which the prior consent of the relevant Joint Bookrunner has been given to the offer or resale; or

ii. where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA other than Qualified Investors, the offer of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons;

3.   it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements, undertakings and agreements contained in this Announcement;

4.   it understands (or if acting for the account of another person, such person has confirmed that such person understands) the resale and transfer restrictions set out in this Appendix; and

5.   it (and any account referred to in paragraph 3 above) is, and at the time the Placing Shares are acquired will be, either (a) located outside of the United States and eligible to participate in an ''offshore transaction'' as defined in and in accordance with Regulation S, or (b) located within the United States and is acquiring the Placed Shares in a transaction that is exempt from the registration requirements under the US Securities Act for its own account (or for the account of a QIB as to which it has sole investment discretion) and (i) is a QIB, (ii) is an MII, and (iii) has executed and delivered a US investor representation letter addressed to Purplebricks Group plc and the Joint Bookrunners.

No prospectus

No prospectus or other offering document has been or will be submitted to be approved by the FCA in relation to the Placing or the Placing Shares and Placees' commitments will be made solely on the basis of the information contained in this Announcement and any information publicly announced through a Regulatory Information Service (as defined in the AIM Rules for Companies (the "AIM Rules")) by or on behalf of Purplebricks Group plc on or prior to the date of this Announcement (the "Publicly Available Information") and subject to any further terms set forth in the contract note to be sent to individual Placees.

Each Placee, by participating in the Placing, agrees that the content of this Announcement is exclusively the responsibility of Purplebricks Group plc and confirms that it has neither received nor relied on any information (other than the Publicly Available Information), representation, warranty or statement made by or on behalf of any of the Joint Bookrunners, Purplebricks Group plc or any other person and none of the Joint Bookrunners, Purplebricks Group plc or any other person acting on such person's behalf nor any of their respective Associates has or shall have any liability for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement.  Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of Purplebricks Group plc in accepting a participation in the Placing.  Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Details of the Placing Agreement and the Placing Shares

The Bookrunners have today entered into a placing agreement (the "Placing Agreement") with Purplebricks Group plc under which, on the terms and subject to the conditions set out in the Placing Agreement, the Joint Bookrunners, as agents for and on behalf of Purplebricks Group plc, have agreed to use their reasonable endeavours to procure Placees for the Placing Shares at the Placing Price.

The Placing Shares will, when issued, be subject to the articles of association of Purplebricks Group plc and credited as fully paid and will rank pari passu in all respects with the Existing Ordinary Shares in the capital of Purplebricks Group plc, including the right to receive all dividends and other distributions declared, made or paid in respect of such Ordinary Shares after the date of issue of the Placing Shares.

As part of the Placing, Purplebricks Group plc has agreed that it will not for a period of 120 days after Admission, offer, issue, sell, contract to sell, issue options in respect of or otherwise dispose of any securities of Purplebricks Group plc (or any interest therein or in respect thereof) or any other securities exchangeable for, or convertible into, or substantially similar to, Ordinary Shares or enter into any transaction having substantially the same effect or agree to do any of the foregoing other than with the prior written consent of the Joint Bookrunners (such consent not to be unreasonably withheld or delayed).

Application for admission to trading

Application will be made to the London Stock Exchange for admission of the Placing Shares to trading on AIM. It is expected that Admission will take place no later than 14 March 2017 and that dealings in the Placing Shares on AIM will commence at the same time.

Principal terms of the Placing

1.     Zeus Capital is authorised and regulated in the United Kingdom by the Financial Conduct Authority ("FCA") and acting as nominated adviser and joint bookrunner to Purplebricks Group plc in respect of the Placing. Peel Hunt is authorised and regulated in the United Kingdom by the FCA and is acting as joint bookrunner to Purplebricks Group plc in respect of the Placing. Investec is acting as joint bookrunner to Purplebricks Group plc in respect of the Placing.  Investec is authorised in the United Kingdom by the Prudential Regulation Authority ("PRA") and regulated by the FCA and the PRA.  The Joint Bookrunners are acting exclusively for Purplebricks Group plc and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than Purplebricks Group plc for providing the protections afforded to their customers or for providing advice in relation to the matters described in this Announcement.

2.    Participation in the Placing will only be available to persons who may lawfully be, and are, invited by a Joint Bookrunner to participate.  Each Joint Bookrunner and each of their respective affiliates are entitled to participate in the Placing as principal.

3.    The price per Placing Share (the "Placing Price") is fixed at 220 pence and is payable to the relevant Joint Bookrunner by each Placee.

4.    Each Placee's allocation is determined by the Joint Bookrunners in their discretion following consultation with Purplebricks Group plc and has been or will be confirmed orally by one of the Joint Bookrunners and a contract note will be dispatched as soon as possible thereafter by that Joint Bookrunner. That oral confirmation will give rise to an irrevocable, legally binding commitment by that person (who at that point becomes a Placee), in favour of that Joint Bookrunner and Purplebricks Group plc, under which it agrees to acquire the number of Placing Shares allocated to the Placee at the Placing Price and otherwise on the terms and subject to the conditions set out in this Appendix and in accordance with Purplebricks Group plc's articles of association. Except with the relevant Joint Bookrunner's consent, such commitment will not be capable of variation or revocation at the time at which it is submitted.

5.    Each Placee's allocation and commitment will be evidenced by a contract note issued to such Placee by the relevant Joint Bookrunner. The terms of this Appendix will be deemed incorporated in that contract note.

6.    Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the relevant Joint Bookrunner (as agent for Purplebricks Group plc), to pay to that Joint Bookrunner (or as it may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire and Purplebricks Group plc has agreed to allot and issue to that Placee.

7.    Irrespective of the time at which a Placee's allocation(s) pursuant to the Placing is/are confirmed, settlement for all Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time, on the basis explained below under "Registration and Settlement".

8.    All obligations of the Joint Bookrunners under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Termination of the Placing".

9.    By participating in the Placing, each Placee will agree that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.

10.   To the fullest extent permissible by law and applicable FCA rules, none of (a) the Joint Bookrunners, (b) any of each Joint Bookrunner's Associates, (c) to the extent not contained within (a) or (b), any person connected with a Joint Bookrunner as defined in the Financial Services and Markets Act 2000 ("FSMA") ((b) and (c) being together "affiliates" and individually an "affiliate" of the relevant Joint Bookrunner), (d) any person acting on a Joint Bookrunner's behalf, shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any other person whether acting on behalf of a Placee or otherwise.  In particular, no Joint Bookrunner nor any of their respective Associates shall have any liability (including, to the extent permissible by law, any fiduciary duties) in respect of their conduct of the Placing or of such alternative method of effecting the Placing as the Joint Bookrunners and Purplebricks Group plc may agree.

Registration and Settlement

If Placees are allocated any Placing Shares in the Placing they will be sent a contract note or electronic confirmation by the relevant Joint Bookrunner, as soon as it is able which will confirm the number of Placing Shares allocated to them, the Placing Price and the aggregate amount owed by them to that Joint Bookrunner.

Each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed as directed by the relevant Joint Bookrunner in accordance with either the standing CREST or certificated settlement instructions which they have in place with that Joint Bookrunner.

Settlement of transactions in the Placing Shares (ISIN: GB00BYV2MV74) following Admission will take place within the CREST system, subject to certain exceptions.  Settlement through CREST is expected to take place on 14 March 2017 unless otherwise notified by the relevant Joint Bookrunner and Admission is expected to occur no later than 8.00 a.m. on 14 March 2017 unless otherwise notified by the relevant Joint Bookrunner. Settlement will be on a delivery versus payment basis. However, in the event of any difficulties or delays in the admission of the Placing Shares to CREST or the use of CREST in relation to the Placing, Purplebricks Group plc and the Joint Bookrunners may agree that the Placing Shares should be issued in certificated form.  The Joint Bookrunners reserve the right to require settlement for the Placing Shares, and to deliver the Placing Shares to Placees, by such other means as they deem necessary if delivery or settlement to Placees is not practicable within the CREST system or would not be consistent with regulatory requirements in a Placee's jurisdiction.

Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of 2 percentage points above prevailing LIBOR as determined by the relevant Joint Bookrunner.

Each Placee is deemed to agree that if it does not comply with these obligations, the relevant Joint Bookrunner may sell any or all of their Placing Shares on their behalf and retain from the proceeds, for that Joint Bookrunner's own account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due.  The relevant Placee will, however, remain liable for any shortfall below the amount owed by it and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of their Placing Shares on their behalf.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, the conditional contract note is copied and delivered immediately to the relevant person within that organisation.  Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to United Kingdom stamp duty or stamp duty reserve tax.  Placees will not be entitled to receive any fee or commission in connection with the Placing.

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

The obligations of the Joint Bookrunners under the Placing Agreement are, and the Placing conditional upon, inter alia:

A.    the passing of the Resolutions at the General Meeting without any amendment not previously approved by the Joint Bookrunners;

B.    the warranties on the part of Purplebricks Group plc contained in the Placing Agreement being true and accurate in all material respects and not misleading on and as of the date of the Placing Agreement and on Admission, as though they had been given and made on such dates by reference to the facts and circumstances then subsisting;

C.    the performance by Purplebricks Group plc of its obligations under the Placing Agreement in so far as they fail to be performed prior to Admission;

D.    no matter having arisen before Admission which might reasonably be expected to give rise to an indemnity claim under the Placing Agreement;

E.    in the opinion of any of the Joint Bookrunners, there shall have been no material adverse change since the date of the Placing Agreement (whether or not foreseeable at the date of the Placing Agreement) before Admission; and

F.    Admission becoming effective by not later than 8.00 a.m. on 14 March 2017 (or such later time and/or date as Purplebricks Group plc and the Joint Bookrunners may agree, being no later than 8.00 a.m. on 24 March 2017),

all conditions to the obligations of the Joint Bookrunners included in the Placing Agreement being together, the "conditions").

If any of the conditions are not fulfilled or, where permitted, waived in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as Purplebricks Group plc and the Joint Bookrunners may agree, provided that the time for satisfaction of the condition set out in F above shall not be extended beyond 8.00 a.m. on 24 March 2017), or the Placing Agreement is terminated in accordance with its terms, the Placing will lapse and the Placee's rights and obligations shall cease and terminate at such time and each Placee agrees that no claim can be made by or on behalf of the Placee (or any person on whose behalf the Placee is acting) in respect thereof.

By participating in the Placing, each Placee agrees that its rights and obligations cease and terminate only in the circumstances described above and under "Termination of the Placing" below and will not be capable of rescission or termination by it.

Certain conditions may be waived in whole or in part by the Joint Bookrunners, in their absolute discretion by notice in writing to Purplebricks Group plc and the Joint Bookrunners may also agree in writing with Purplebricks Group plc to extend the time for satisfaction of any condition. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.

The Joint Bookrunners may terminate the Placing Agreement in certain circumstances, details of which are set out below.

Neither the Joint Bookrunners, Purplebricks Group plc nor any of their respective Associates shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision any of them may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition to the Placing nor for any decision any of them may make as to the satisfaction of any condition or in respect of the Placing generally and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Joint Bookrunners.

Termination of the Placing

Any of the Joint Bookrunners may terminate the Placing Agreement, in accordance with its terms, at any time prior to Admission if, inter alia:

1.       it comes to the knowledge of any of the Joint Bookrunners that any of the warranties were untrue or inaccurate in any respect or misleading in any case that is material in the context of Admission or the Placing; or

2.       it comes to the notice of any of the Joint Bookrunners that any statement contained in this Announcement, or any other document or announcement issued or published by or on behalf of Purplebricks Group plc in connection with the Placing, is or has become untrue or incorrect in any material respect or misleading; or

3.       in any Joint Bookrunner's opinion, any matter or circumstance has arisen which would give rise to an indemnity claim under the Placing Agreement; or

4.       a force majeure event has occurred, or any material adverse change has occurred in the financial position, prospects or business of Purplebricks Group plc and its subsidiary undertakings (taken as whole) which, in the opinion of the Joint Bookrunners, would materially prejudice the success of the Placing or the distribution of the Placing Shares; or

5.       in the opinion of the Joint Bookrunners, a material adverse change has occurred.

If the Placing Agreement is terminated in accordance with its terms, the rights and obligations of each Placee in respect of the Placing as described in this Announcement shall cease and terminate at such time and no claim can be made by any Placee in respect thereof.

By participating in the Placing, each Placee agrees with Purplebricks Group plc and the Joint Bookrunners that the exercise by Purplebricks Group plc or any of the Joint Bookrunners of any right of termination or any other right or other discretion under the Placing Agreement shall be within the absolute discretion of Purplebricks Group plc or the Joint Bookrunners and that neither of Purplebricks Group plc nor any Joint Bookrunner need make any reference to such Placee and that neither the Joint Bookrunners, Purplebricks Group plc, nor any of their respective Associates shall have any liability to such Placee (or to any other person whether acting on behalf of a Placee or otherwise) whatsoever in connection with any such exercise.

By participating in the Placing, each Placee agrees that its rights and obligations terminate only in the circumstances described above and under the "Conditions of the Placing" section above and will not be capable of rescission or termination by it after the issue by the relevant Joint Bookrunner of a contract note confirming each Placee's allocation and commitment in the Placing.

Representations and warranties

By agreeing to acquire Placing Shares each Placee and, to the extent applicable, any person confirming his agreement to acquire Placing Shares on behalf of a Placee or authorising a Joint Bookrunner to notify a Placee's name to the Registrar, is deemed to acknowledge, agree, undertake, represent and warrant to the Joint Bookrunners and Purplebricks Group plc that:

A.         it has read and understood this Announcement in its entirety and that its acquisition of the Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, indemnities, acknowledgements, agreements and undertakings and other information contained herein and that it has not relied on, and will not rely on, any information given or any representations, warranties or statements made at any time by any person in connection with Admission, the Placing, Purplebricks Group plc, the Placing Shares or otherwise, other than the information contained in this Announcement and the Publicly Available Information;

B.         it has not received a prospectus or other offering document in connection with the Placing and acknowledges that no prospectus or other offering document: (a) is required under the Prospectus Directive; and (b) has been or will be prepared in connection with the Placing;

C.         its participation in the Placing shall be made solely on the terms and subject to the conditions set out in these terms and conditions and the Articles. Such Placee agrees that these terms and conditions and the contract note issued by the relevant Joint Bookrunner to such Placee represent the whole and only agreement between the Placee, the relevant Joint Bookrunner (as agent of Purplebricks Group plc) and Purplebricks Group plc in relation to the Placee's participation in the Placing and supersedes any previous agreement between any of such parties in relation to such participation. Accordingly, all other terms, conditions, representations, warranties and other statements which would otherwise be implied (by law or otherwise) shall not form part of these terms and conditions. The Placee agrees that none of Purplebricks Group plc, the Joint Bookrunners nor any of their respective officers or directors will have any liability for any such other information or representation and irrevocably and unconditionally waives any rights it may have in respect of any such other information or representation;

D.         neither the Joint Bookrunners, any person acting on behalf of a Joint Bookrunner or any of their Associates has or shall have any liability for any Publicly Available Information, or any representation relating to Purplebricks Group plc, provided that nothing in this paragraph excludes the liability of any person for fraudulent misrepresentation made by that person;

E.         the only information on which it is entitled to rely on and on which it has relied in committing to subscribe for the Placing Shares is contained in the Publicly Available Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and it has made its own assessment of Purplebricks Group plc, the Placing Shares and the terms of the Placing based on Publicly Available Information; (b) no Joint Bookrunner, Purplebricks Group plc nor any of their respective Associates has made any representation or warranty to it, express or implied, with respect to Purplebricks Group plc, the Placing or the Placing Shares or the accuracy, completeness or adequacy of the Publicly Available Information; (c) it has conducted its own investigation of Purplebricks Group plc, the Placing and the Placing Shares, satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placing; and (d) has not relied on any investigation that the Joint Bookrunners or any person acting on behalf of a Joint Bookrunner may have conducted with respect to Purplebricks Group plc, the Placing or the Placing Shares;

F.         the content of this Announcement and the Publicly Available Information has been prepared by and is exclusively the responsibility of Purplebricks Group plc and that no Joint Bookrunner nor any persons acting on behalf of a Joint Bookrunner is responsible for or has or shall have any liability for any information, representation, warranty or statement relating to Purplebricks Group plc contained in this Announcement or the Publicly Available Information nor will they be liable for any Placee's decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement, the Publicly Available Information or otherwise.  Nothing in this Appendix shall exclude any liability of any person for fraudulent misrepresentation;

G.         none of the Joint Bookrunners nor any of their Associates nor any person acting on their behalf is responsible for or shall have any liability for any information previously published by or on behalf of Purplebricks Group plc or any member of the Group and will not be liable for any decision by a Placee to participate in the Placing based on any information previously published by or on behalf of Purplebricks Group plc or any member of the Group;

H.         the Placee acknowledges that the Placing Shares will be admitted to AIM, and Purplebricks Group plc is therefore required to publish certain business and financial information in accordance with the rules and practices of the London Stock Exchange and the FCA (collectively, the "Exchange Information"), which includes a description of the nature of Purplebricks Group plc's business and Purplebricks Group plc's most recent balance sheet and profit and loss account and that the Placee is able to obtain or access such Exchange Information without undue difficulty and is able to obtain access to such information or comparable information concerning any other publicly traded company without undue difficulty;

I.          the Placee has not relied on the Joint Bookrunners nor any of their Associates in connection with any investigation of the accuracy of any information previously published by or on behalf of Purplebricks Group plc or any member of the Group or their decision to subscribe;

J.          the Joint Bookrunners are not making any recommendations to Placees or advising any of them regarding the suitability or merits of any transaction they may enter into in connection with the Placing, and each Placee acknowledges that participation in the Placing is on the basis that it is not and will not be a client of any of the Joint Bookrunners and that the Joint Bookrunners are acting for Purplebricks Group plc and no one else, and they will not be responsible to anyone else for the protections afforded to their respective clients, and that the Joint Bookrunners will not be responsible to anyone other than Purplebricks Group plc for providing advice in relation to the Placing or any transaction, arrangements or other matters referred to herein. The Joint Bookrunners will not be responsible for anyone other than the relevant party to the Placing Agreement in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement or for the exercise or performance of the Joint Bookrunners' rights and obligations thereunder, including any right to waive or vary any condition or exercise any termination right contained therein;

K.         save in the event of fraud on its part (and to the extent permitted by the rules of the FCA), neither the Joint Bookrunners nor any of their directors or employees shall be liable to a Placee for any matter arising out of the role of any of the Joint Bookrunners as Purplebricks Group plc's nominated adviser, broker or otherwise (as applicable), and that where any such liability nevertheless arises as a matter of law each Placee will immediately waive any claim against the Joint Bookrunners and any of their respective directors and employees which a Placee may have in respect thereof;

L.         it and/or each person on whose behalf it is participating:

I.      is entitled to acquire Placing Shares pursuant to the Placing under the laws and regulations of all relevant jurisdictions;

II.     has fully observed such laws and regulations;

III.    has capacity and authority and is entitled to enter into and perform its obligations as an acquirer of Placing Shares and will honour such obligations; and

IV.    has obtained all necessary consents and authorities (including, without limitation, in the case of a person acting on behalf of a Placee, all necessary consents and authorities to agree to the terms set out or referred to in this Appendix) under those laws or otherwise and complied with all necessary formalities to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto and, in particular, if it is a pension fund or investment company it is aware of and acknowledges it is required to comply with all applicable laws and regulations with respect to its subscription for Placing Shares;

M.        if the laws of any place outside the United Kingdom are applicable to the Placee's agreement to acquire Placing Shares under the Placing, such Placee has complied with all applicable laws and such Placee will not infringe any applicable law as a result of such Placee's agreement to acquire Placing Shares under the Placing and/or acceptance thereof or any actions arising from such Placee's agreement to acquire Placing Shares under the Placing and/or acceptance thereof or under the Articles;

N.         all actions, conditions and things required to be taken, fulfilled and done (including the obtaining of necessary consents) in order: (i) to enable the Placee to exercise its rights and perform and comply with its obligations to acquire the Placing Shares under the Placing; and (ii) to ensure that those obligations are legally binding and enforceable, have been taken, fulfilled and done. The Placee's exercise of its rights and/or performance under, or compliance with its obligations under the Placing, does not and will not violate: (a) its constitutive documents; or (b) any agreement to which the Placee is a party or which is binding on the Placee or its assets;

O.         the Placee agrees to accept the Placing Shares subject to, and to comply with, the Articles.

P.         the Placee has the funds available to pay for the Placing Shares for which it has agreed to subscribe and acknowledges and agrees that it will make payment to the relevant Joint Bookrunner for the Placing Shares allocated to it in accordance with the terms and conditions of this Announcement on the due times and dates set out in this Announcement, failing which the relevant Placing Shares may be placed with others on such terms as the Joint Bookrunners may, in their absolute discretion determine without liability to the Placee and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this Announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

Q.         if the Placee is a resident in the European Economic Area, it is a qualified investor within the meaning of the law in the Relevant Member State implementing Article 2(1)(e)(i), (ii) or (iii) of the Prospectus Directive (Directive 2003/71/EC);

R.         it understands that no action has been or will be taken in any jurisdiction by Purplebricks Group plc, the Joint Bookrunners or any other person that would permit a Placing of the Placing Shares, or possession or distribution of this announcement, in any country or jurisdiction where action for that purpose is required; and that, if the Placee is in a Relevant Member State, it is: (i) a legal entity which is authorised or regulated to operate in the financial markets or, if not so authorised or regulated, its corporate purpose is solely to invest in securities; (ii) a legal entity which has two or more of: (a) an average of at least 250 employees during the last financial year; (b) a total balance sheet of more than €43,000,000; and (c) an annual net turnover of more than €50,000,000, in each case as shown in its last annual or consolidated accounts; (iii) otherwise permitted by law to be offered Placing Shares in circumstances which do not require the publication by Purplebricks Group plc of a prospectus pursuant to Article 3 of the Prospectus Directive or other applicable laws; or (iv) in the case of any Placing Shares acquired by a Placee as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, either:

I.    the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their placing or resale to, persons in any Relevant Member State other than qualified investors, as that term is defined in the Prospectus Rules, or in circumstances in which the prior consent of the Joint Bookrunners has been given to the placing or resale; or

II.    where Placing Shares have been acquired by it on behalf of persons in any Relevant Member State other than qualified investors, the placing of those Placing Shares to it is not treated under the Prospectus Rules as having been made to such persons;

S.         to the fullest extent permitted by law, the Placee acknowledges and agrees to the disclaimers contained in this announcement and acknowledges and agrees to comply with the selling restrictions set out in this announcement;

T.         the Placing Shares may not be offered or sold in the United States absent (i) registration under the US Securities Act or (ii) an available exemption from registration under the US Securities Act. The Placing Shares have not been, and will not be, registered under the US Securities Act and will not be offered to the public in the United States. The Placing Shares have not been and will not be registered under the securities legislation of, or with any securities regulatory authority of, any other Restricted Jurisdiction;

U.         the Placee (and any person or account on whose behalf it is acquiring the Placing Shares is, and at the time the Placing Shares are acquired will be, either (a) located outside of the United States and eligible to participate in an ''offshore transaction'' as defined in and in accordance with Regulation S, or (b) located within the United States is acquiring the Placed Shares in a transaction that is exempt from the registration requirements under the US Securities Act for its own account (or for the account of a QIB as to which it has sole investment discretion) and (i) is a QIB, (ii) is an MII, and (iii) has executed and delivered a US investor representation letter addressed to Purplebricks Group plc and the Joint Bookrunners;

V.         the Placee is not acquiring the Placing Shares as a result of any ''directed selling efforts'' as defined in Regulation S or as a result of any form of general solicitation or general advertising (within the meaning of Rule 502(c) of Regulation D under the US Securities Act);

W.        if it is acquiring the Placing Shares for the account of one or more other persons, it has full power and authority to make the representations, warranties, agreements and acknowledgements herein on behalf of each such account;

X.         the Placee is acquiring the Placing Shares for investment purposes only and not with a view to any resale, distribution or other disposition of the Placing Shares in violation of the US Securities Act or any other United States federal or applicable state securities laws;

Y.         Purplebricks Group plc, and any registrar or other agent of Purplebricks Group plc, will not be required to accept the registration of transfer of any Placing Shares acquired by the Placee, except upon presentation of evidence satisfactory to Purplebricks Group plc that the foregoing restrictions on transfer have been complied with;

Z.         the Placee invests in or purchases securities similar to the Placing Shares in the normal course of its business and it has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Placing Shares;

AA.       the Placee has conducted its own investigation with respect to Purplebricks Group plc and the Placing Shares, and the Placee has concluded that an investment in the Placing Shares is suitable for it or, where the Placee is not acting as principal, for any beneficial owner of the Placing Shares, based upon each such person's investment objectives and financial requirements;

BB.       the Placee or, where the Placee is not acting as principal, any beneficial owner of the Placing Shares, is able to bear the economic risk of an investment in the Placing Shares for an indefinite period and the loss of its entire investment in the Placing Shares;

CC.       the Placee is not a resident of a Restricted Jurisdiction and acknowledges that the Placing Shares have not been and will not be registered nor will a prospectus be prepared in respect of the Placing Shares under the securities legislation of any Restricted Jurisdiction and, subject to certain exceptions, Placing Shares may not be issued  in those Restricted Jurisdictions;

DD.       the Placee is liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the UK by it or any other person on the acquisition by it of any Placing Shares or the agreement by it to acquire any Placing Shares;

EE.       in the case of a person who confirms to the relevant Joint Bookrunner on behalf of a Placee an offer to acquire Placing Shares under the Placing and/or who authorises the relevant Joint Bookrunner to notify such Placee's name to the Registrar, that person represents and warrants that he has authority to do so on behalf of the Placee;

FF.       the Placee has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000 and the Money Laundering Regulations 2007 and any other applicable law concerning the prevention of money laundering and, if it is making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Money Laundering Regulations 2007 and, in each case, agrees that pending satisfaction of such obligations, definitive certificates (or allocation under the CREST system) in respect of the Placing Shares comprising the Placee's allocation may be retained at the relevant Joint Bookrunner's discretion;

GG.      the Placee agrees that, due to anti-money laundering and the countering of terrorist financing requirements, the Joint Bookrunners and/or Purplebricks Group plc may require proof of identity of the Placee and related parties and verification of the source of the payment before the application can be processed and that, in the event of delay or failure by the Placee to produce any information required for verification purposes, the Joint Bookrunners and/or Purplebricks Group plc may refuse to accept the application and the moneys relating thereto. It holds harmless and will indemnify the Joint Bookrunners and/or Purplebricks Group plc against any liability, loss or cost ensuing due to the failure to process this application, if such information as has been required has not been provided by it or has not been provided on a timely basis;

HH.       the Placee acknowledges that its commitment to acquire Placing Shares on the terms set out in this Announcement and in the contract note will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to Purplebricks Group plc's or the Joint Bookrunners' conduct of the Placing;

II.          it has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of subscribing for the Placing Shares.  It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing.  It has relied upon its own examination and due diligence of Purplebricks Group plc and its affiliates taken as a whole, and the terms of the Placing, including the merits and risks involved;

JJ.        the Placee acknowledges that any money held in an account with the Joint Bookrunners on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the rules and regulations of the FCA. The Placee further acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from the relevant Joint Bookrunner's money in accordance with the client money rules and will be used by the relevant Joint Bookrunner in the course of its own business; and the Placee will rank only as a general creditor of the relevant Joint Bookrunner;

KK.       the Placee is not, and is not applying as nominee or agent for, a person which is, or may be, mentioned in any of sections 67, 70, 93 and 96 of the Finance Act 1986 (depository receipts and clearance services);

LL.        the Placee has complied with and will comply with all applicable provisions of the FSMA with respect to anything done by the Placee in relation to the Placing in, from or otherwise involving the UK;

MM.      if the Placee is in the UK, the Placee is a person: (i) who has professional experience in matters relating to investments falling within article 19(5) of the  Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order"); or (ii) a high net worth entity falling within article 49(2)(a) to (d) of the Order, and in all cases is capable of being categorised as a Professional Client or Eligible Counterparty for the purposes of the FCA Conduct of Business Rules;

NN.       if the Placee is in the EEA, the person is a ''Professional Client/Eligible Counterparty'' within the meaning of Annex II/Article 24 (2) of MiFID and is not participating in the Placing on behalf of persons in the EEA other than professional clients or persons in the UK and other Member States (where equivalent legislation exists) for whom the Placee has authority to make decisions on a wholly discretionary basis;

OO.      each Placee in a relevant member state of the EEA who acquires any Placing Shares under the Placing contemplated hereby will be deemed to have represented, warranted and agreed with each of the Joint Bookrunners and Purplebricks Group plc that: (i) it is a qualified Placee within the meaning of the law in that relevant member state implementing Article 2(1) of the Prospectus Directive; and (ii) in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive: (A) the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their placing or resale to, persons in any relevant member state other than qualified Placees, as that term is defined in the Prospectus Directive, or in other circumstances falling within Article 3(2) of the Prospectus Directive and the prior consent of the Joint Bookrunners has been given to the placing or resale; or where Placing Shares have been acquired by it on behalf of persons in any relevant member state other than qualified Placees, the Placing of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons;

PP.       in the case of a person who confirms to a Joint Bookrunner on behalf of a Placee an offer to acquire Placing Shares under the Placing and who is acting on behalf of a third party, that the terms on which the Placee (or any person acting on its behalf) are engaged enable it to make investment decisions in relation to securities on that third party's behalf without reference to that third party;

QQ.      it has neither received nor relied on any confidential price sensitive information about Purplebricks Group plc in accepting this invitation to participate in the Placing;

RR.       no Joint Bookrunner nor their Associates has or shall have any liability for any information, representation or statement contained in this Announcement or for any information previously published by or on behalf of Purplebricks Group plc or any other written or oral information made available to or publicly available or filed information or any representation, warranty or undertaking relating to Purplebricks Group plc, and will not be liable for its decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement or elsewhere, provided that nothing in this paragraph shall exclude any liability of any person for fraud;

SS.       neither the Joint Bookrunners, their Associates, Purplebricks Group plc nor its Associates is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing nor providing advice in relation to the Placing nor in respect of any representations, warranties, acknowledgements, agreements, undertakings, or indemnities contained in the Placing Agreement nor the exercise or performance of the Joint Bookrunners' rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

TT.        acknowledges and accepts that the Joint Bookrunners may, in accordance with applicable legal and regulatory provisions, engage in transactions in relation to the Placing Shares and/or related instruments for their own account and, except as required by applicable law or regulation, the Joint Bookrunners will not make any public disclosure in relation to such transactions;

UU.       the exercise by the Joint Bookrunners of any rights or discretions under the Placing Agreement shall be within their absolute discretion and the Joint Bookrunners need not have any reference to any Placee and shall have no liability to any Placee whatsoever in connection with any decision to exercise or not to exercise or to waive any such right and each Placee agrees that it shall have no rights against the Joint Bookrunners or any of their directors or employees under the Placing Agreement;

VV.       the Placee has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) relating to the Placing Shares (as applicable) in circumstances in which section 21(1) of FSMA does not require approval of the communication by an authorised person;

WW.     the Placee has complied and it will comply with all applicable laws with respect to anything done by it or on its behalf in relation to the Placing Shares (including all relevant provisions of the FSMA in respect of anything done in, from or otherwise involving the United Kingdom);

XX.        it irrevocably appoints any director of the Joint Bookrunners as its agent for the purposes of executing and delivering to Purplebricks Group plc and/or the Registrar any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares agreed to be taken up by it under the Placing and otherwise to do all acts, matters and things as may be necessary for, or incidental to, its acquisition of any Placing Shares in the event of its failure so to do;

YY.       it will indemnify and hold Purplebricks Group plc, the Joint Bookrunners and their respective Associates harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings in this Appendix and further agrees that the provisions of this Appendix will survive after completion of the Placing;

ZZ.        the Joint Bookrunners may, in accordance with applicable legal and regulatory provisions, engage in transactions in relation to the Placing Shares and/or related instruments for their own account and, except as required by applicable law or regulation, the Joint Bookrunners will not make any public disclosure in relation to such transactions;

AAA.    the Joint Bookrunners and each of their respective affiliates, each acting as a Placee for its or their own account(s), may bid or subscribe for and/or purchase Placing Shares and, in that capacity, may retain, purchase, placing to sell or otherwise deal for its or their own account(s) in the Placing Shares, any other securities of Purplebricks Group plc or other related investments in connection with the Placing or otherwise. Accordingly, references in this announcement to the Placing Shares being issued, subscribed, acquired or otherwise dealt with should be read as including any issue, subscription, acquisition or dealing by the Joint Bookrunners and/or any of their respective affiliates, acting as a Placee for its or their own account(s). No Joint Bookrunner nor Purplebricks Group plc intend to disclose the extent of any such investment or transaction otherwise than in accordance with any legal or regulatory obligation to do so;

BBB.    time is of the essence as regards its obligations under this Appendix;

CCC.    any document that is to be sent to it in connection with the Placing will be sent at its risk and may be sent to it at any address provided by it to the relevant Joint Bookrunner;

DDD.    the Placing Shares will be issued subject to the terms and conditions of this Appendix; and

EEE.    these terms and conditions in this Appendix and all documents into which this Appendix is incorporated by reference or otherwise validly forms a part and/or any agreements entered into pursuant to these terms and conditions and all agreements to acquire shares pursuant to the Placing will be governed by and construed in accordance with English law and it submits to the exclusive jurisdiction of the English courts in relation to any claim, dispute or matter arising out of any such contract, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by Purplebricks Group plc or the Joint Bookrunners in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange.

Purplebricks Group plc and the Joint Bookrunners will rely upon the truth and accuracy of each of the foregoing agreements, representations, warranties and undertakings. The agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax in the United Kingdom relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, direct by Purplebricks Group plc.  Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer the Placing Shares into a clearance service.  If there are any such arrangements, or the settlement related to any other dealings in the Placing Shares, stamp duty or stamp duty reserve tax may be payable.  In that event, the Placee agrees that it shall be responsible for such stamp duty or stamp duty reserve tax and neither Purplebricks Group plc nor the Joint Bookrunners shall be responsible for such stamp duty or stamp duty reserve tax.  If this is the case, each Placee should seek its own advice and they should notify the relevant Joint Bookrunner accordingly.  In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the United Kingdom by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares and each Placee, or the Placee's nominee, in respect of whom (or in respect of the person for whom it is participating in the Placing as an agent or nominee) the allocation, allotment, issue or delivery of Placing Shares has given rise to such non-United Kingdom stamp, registration, documentary, transfer or similar taxes or duties undertakes to pay such taxes and duties, including any interest and penalties (if applicable), forthwith and to indemnify on an after-tax basis and to hold harmless Purplebricks Group plc and each Joint Bookrunner in the event that either Purplebricks Group plc and/or any Joint Bookrunner has incurred any such liability to such taxes or duties.

The representations, warranties, acknowledgements and undertakings contained in this Appendix are given to the Joint Bookrunners for itself and on behalf of Purplebricks Group plc and are irrevocable.

Each Placee and any person acting on behalf of the Placee acknowledges that none of the Joint Bookrunners owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements, agreements or indemnities in the Placing Agreement.

If any Joint Bookrunner or Purplebricks Group plc or any of their respective agents request any information about a Placee's agreement to acquire Placing Shares, such Placee must promptly disclose it to them and ensure that such information is complete and accurate in all respects.

The rights and remedies of the Joint Bookrunners and Purplebricks Group plc under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them, and the exercise or partial exercise of one will not prevent the exercise of others.

On application, each Placee may be asked to disclose, in writing or orally to the Joint Bookrunners:

·        if he is an individual, his nationality; or

·        if he is a discretionary fund manager, the jurisdiction in which the funds are managed or owned.

All documents will be sent at the Placee's risk. They may be sent by post to such Placee at an address notified to the relevant Joint Bookrunner.

Each Placee agrees to be bound by the Articles (as amended from time to time) once the Placing Shares which such Placee has agreed to acquire have been acquired by such Placee.

The provisions of this Appendix may be waived, varied or modified as regards specific Placees or on a general basis by the Joint Bookrunners, provided that such waiver, variation or modification is not materially prejudicial to the interests of Purplebricks Group plc.

The contract to acquire Placing Shares and the appointments and authorities mentioned herein will be governed by, and construed in accordance with, the laws of England and Wales. For the exclusive benefit of the Joint Bookrunners and Purplebricks Group plc, each Placee irrevocably submits to the exclusive jurisdiction of the English courts in respect of these matters. This does not prevent an action being taken against a Placee in any other jurisdiction.

In the case of a joint agreement to acquire Placing Shares, references to a ''Placee'' in these terms and conditions are to each of such Placees and such joint Placees' liability is joint and several.

The Joint Bookrunners and Purplebricks Group plc each expressly reserve the right to modify the Placing (including, without limitation, its timetable and settlement) at any time before allocations of Placing Shares under the Placing are settled.

The Placing is subject to the satisfaction of the relevant conditions contained in the Placing Agreement and the Placing Agreement not having been terminated.

References to time in this Announcement are to London time, unless otherwise stated. All times and dates in this Announcement may be subject to amendment. 

No statement in this Announcement is intended to be a profit forecast, and no statement in this Announcement should be interpreted to mean that earnings per share of Purplebricks Group plc for the current or future financial years would necessarily match or exceed the historical published earnings per share of Purplebricks Group plc.

The price of shares and any income expected from them may go down as well as up and investors may not get back the full amount invested upon disposal of the shares.  Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.

The Placing Shares to be issued or sold pursuant to the Placing will not be admitted to trading on any stock exchange other than the London Stock Exchange.

Neither the content of Purplebricks Group plc's website nor any website accessible by hyperlinks on Purplebricks Group plc's website is incorporated in, or forms part of, this Announcement.

Appendix III - Definitions

The following definitions apply throughout this document unless the context otherwise requires:

Act	the Companies Act 2006
Admission	the admission of the Placing Shares to trading on AIM becoming effective in accordance with Rule 6 of the AIM Rules
AIM	the market of that name operated by the London Stock Exchange
AIM Rules	the AIM Rules for Companies as published by the London Stock Exchange from time to time
announcement	this document
Articles	the articles of association of the Company, as in force from time to time
Associate	affiliates, agents, directors, officers or employees and any person acting on their behalf
Buying Agent	the real estate agent in the United States who acts for, or introduces, a buyer to a listing
Company or Purplebricks	Purplebricks Group plc
CREST	the computerised settlement system (as defined in the CREST Regulations) operated by Euroclear which facilitates the transfer of title to shares in uncertificated form
CREST member	a person who has been admitted by Euroclear as a system-member (as defined in the Regulations)
CREST participant	a person who is, in relation to CREST, a system-participant (as defined in the Regulations)
CREST sponsor	a CREST participant admitted to CREST as a CREST sponsor
CREST sponsored member	a CREST member admitted to CREST as a sponsored member (which includes all CREST Personal Members)
Directors or Board	the directors of the Company as at the date of this Circular
EEA	the European Economic Area
Enlarged Share Capital	the Ordinary Shares in issue immediately following Admission, assuming the Placing of such number of Placing Shares as outlined in this document
EU	the European Union
Euroclear	Euroclear UK & Ireland Limited, the operator of CREST
Existing Ordinary Shares	the 247,773,639 Ordinary Shares in issue as at the date of this document
FCA	the Financial Conduct Authority
FSMA	the Financial Services and Markets Act 2000 (as amended) of the UK including any regulations made pursuant thereto
General Meeting	the General Meeting of the Company expected to be held at 10 a.m. on 13 March 2017
Group	the Company, its subsidiaries and its subsidiary undertakings
HMRC	Her Majesty's Revenue and Customs
Investec	Investec Bank plc
Joint Bookrunners	Investec, Peel Hunt and Zeus Capital
Listing Agent	the real estate agent in the United States who acts for a seller and lists the seller's real property on an MLS
Local Property Experts or LPEs	the local property experts of the Company who are an integral part of the Company's business, being persons employed by the Company or persons or companies granted a licence by the Company to operate under the Purplebricks brand in a specified area
London Stock Exchange	London Stock Exchange plc
LPE Licence Agreement	the licence agreements entered into by LPEs on the basis of a Company template which govern the relationship between the Company and the LPEs and the LPEs' use of the Company's name
MiFID	the Markets in Financial instruments Directive of the European Parliament and of the Council 2004/39/EC
MLS	Multiple Listing Service, the primary purpose of which is to provide a facility for all licensed real estate agents (i.e. each a Listing Agent) to publish all of their listings enabling other real estate agents (i.e. a Buying Agent) to introduce potential buyers for the property
Official List	the Official List of the UK Listing Authority
Ordinary Shares	ordinary shares of 1 pence each in the capital of the Company
Peel Hunt	Peel Hunt LLP
Placees	investors who are participating in the Placing
Placing	the conditional placing by the Joint Bookrunners on behalf of the Company of the Placing Shares at the Placing Price pursuant to the Placing Agreement
Placing Agreement	the conditional agreement dated 22 February 2017 between the Company and the Joint Bookrunners relating to the Placing
Placing Price	means 220 pence per Placing Share
Placing Shares	the Ordinary Shares proposed by the Company to be issued to Placees pursuant to the Placing
Prospectus Directive	means the Prospectus Directive of the European Parliament and of the Council 2003/71/EC
Prospectus Rules	means the Prospectus Rules brought into effect on 1 July 2005 pursuant to Commission Regulation (EC) No. 809/2004 as amended
Registrar	Capita Asset Services
Regulations	the Uncertificated Securities Regulations 2001, as amended from time to time
Regulatory Information Service	has the meaning given to it in the AIM Rules
Relevant Member State	means each EEA state which has implemented the Prospectus Directive
Resolutions	the resolutions set out in the notice convening the General Meeting seeking Shareholder approval to grant authorities to the Directors to allot further shares for cash on a non-pre-emptive basis
Restricted Jurisdiction	means the United States and any territories and possessions thereof, Canada, Japan, Jersey Australia, South Africa and any jurisdiction where the relevant action would constitute a violation of the relevant laws and/or regulations of such jurisdiction or would result in a requirement to comply with any governmental or other consent or any registration, filing or other formality which NCC Group regards as unduly onerous or would result in significant risk or civil, regulatory or criminal exposure if information concerning the Issue is sent or made available in that jurisdiction;
Shareholders	holders of Ordinary Shares
UK or United Kingdom	the United Kingdom of Great Britain and Northern Ireland
uncertificated or in uncertificated form	recorded on the relevant register or other record of the share or other security concerned as being held in uncertificated form in CREST, and title to which, by virtue of the Regulations, may be transferred by means of CREST
US or United States	the United States of America, its territories and possessions
Woodford	collectively, CF Woodford Investment Fund, Woodford Patient Capital Trust plc and Woodford Investment Management Ltd as discretionary investment manager of CF Woodford Investment Fund and Woodford Patient Capital Trust plc
Zeus Capital	Zeus Capital Limited

 

END

 

 

IOEUUSNRBNAUUAR