AO To Acquire Music Magpie

The boards of directors of AO World PLC ("AO") and musicMagpie PLC ("musicMagpie") are pleased to announce that they have agreed the terms of a recommended cash acquisition of the entire issued and to be issued share capital of musicMagpie by AO Ltd ("AO Bidco"), a wholly-owned subsidiary of AO.

It is intended that the Acquisition will be implemented by way of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act (although AO Bidco reserves the right to effect the Acquisition by way of a Takeover Offer, subject to the consent of the Panel and the terms of the Co-operation Agreement).

Under the terms of the Acquisition, each musicMagpie Shareholder will be entitled to receive:

for each musicMagpie Share: 9.07 pence in cash (the "Consideration").

• The Acquisition values the entire issued and to be issued share capital of musicMagpie at approximately £9,982,105 on a fully diluted basis and represents a premium of approximately:

- 58 per cent. to the Closing Price of 5.75 pence per musicMagpie Share on 1 October 2024 (being the last Business Day before this announcement) (the "Latest Practicable Date");

- 58 per cent. to the volume-weighted average Closing Price of 5.75 pence per musicMagpie Share for the one-month period ended on the Latest Practicable Date; and

- 48 per cent. to the volume-weighted average Closing Price of 6.12 pence per musicMagpie Share for the three-month period ended on the Latest Practicable Date.

• With complementary business models focused online and on customer service, AO believes the Acquisition will augment its capability and value capture in the mobile and consumer technology categories.

Non-Executive Chair of AO, Geoff Cooper commented:

"The proposed acquisition of musicMagpie presents a strategic opportunity to integrate one of the UK's leading mobile recommerce operators into our portfolio. With highly complementary business models, this acquisition will enable us to broaden our customer offerings while simultaneously advancing our sustainability objectives. This alignment positions us to drive growth and innovation in an increasingly environmentally-conscious market."

Chief Executive Officer of AO, John Roberts commented:

"To achieve our strategic ambition of becoming the destination for electricals, it is crucial for AO to enhance its consumer tech offering. A top-tier trade-in service will be essential, and musicMagpie represents a significant enabler in unlocking value through our reverse supply chain. Moreover, musicMagpie stands to leverage our existing supply channels, which could lower its cost of acquisition and allow us to scale refurbished technology with operational precision. musicMagpie's commitment to customer satisfaction and its exceptional brand are closely aligned with our values, and our shared cultures create a strong foundation for collaboration. I am excited to welcome Steve and the musicMagpie team into the AO family and to realise the potential that our combined efforts can unlock."

Non-Executive Chair of musicMagpie, Martin Hellawell commented:

"The musicMagpie Board is pleased to recommend AO's cash offer for musicMagpie. AO's offer is the result of musicMagpie's extensive process to seek an acquiror for the business and represents an opportunity for shareholders to realise their holdings in full and in cash at a significant premium to the prevailing share price. The musicMagpie Board believes musicMagpie will benefit from being a part of the AO Group that has the scale and reach to support musicMagpie's future growth and development."

Chief Executive Officer and Co-founder of musicMagpie, Steve Oliver commented:

"AO is a highly trusted consumer brand that shares our commitment to providing a first-rate service for customers. I am very proud of the musicMagpie business and the trusted brand that we have created, providing consumers with a smart, sustainable and trusted way to buy, rent and sell refurbished consumer technology and physical media products. We welcome the opportunity to join the AO Group and believe it represents a natural custodian for musicMagpie as part of the next stage of the business' development."

Source : AO World PLC

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