TIDMWTG

RNS Number : 1367K

Watchstone Group PLC

19 September 2016

Watchstone Group plc

("Watchstone" or the "Company")

Response to announcement by Slater & Gordon Limited

Watchstone Group plc (LON:WTG) notes the announcement by Slater and Gordon Limited (ASX: SGH) advising that it and/or Slater and Gordon (UK) 1 Ltd (together "SGH") intend to bring a claim against Watchstone arising from SGH UK's purchase of the Company's Professional Services Division in May 2015 ("SGH Announcement").

Watchstone confirms that it has today received preliminary correspondence on behalf of SGH notifying it of a purported claim. The Company does not believe that there are grounds for a claim to be brought and will defend it robustly.

Watchstone conducted a professional and transparent disposal process of the Professional Services Division assisted and advised by leading specialists. In addition, Watchstone allowed SGH the opportunity to complete an extensive and detailed due diligence process with the assistance and advice of a similarly specialist team.

Watchstone notes reference in the SGH Announcement to the escrow account containing GBP50.0m of the original purchase consideration for the acquisition ("Warranty Escrow") due for release to Watchstone on 29 November 2016.

Following 29 November 2016, monies will be released to Watchstone from the Warranty Escrow unless, inter alia, Watchstone receives an opinion of a senior independent barrister stating that a given claim is more likely to succeed than not ("Opinion"). The Opinion will also quantify what such claim, if successfully brought against Watchstone, would be valued at and this amount would then be retained in the Warranty Escrow until the purported claim was resolved with any excess up to the GBP50.0m released to Watchstone. Prior to the giving of an Opinion, Watchstone will have the opportunity to make submissions in respect of such matters.

Watchstone will make further announcements in due course, as appropriate.

For further information:

 
 Watchstone Group plc                         Tel: 03333 448048 
 
 Tulchan Communications                     Tel: 020 7353 
                                                 4200 
 Susanna Voyle 
 
   Peel Hunt LLP, Nominated Adviser          Tel: 020 7418 
   and broker                                    8900 
 Dan Webster

This information is provided by RNS

The company news service from the London Stock Exchange

END

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September 19, 2016 02:00 ET (06:00 GMT)

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