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Harvey Nash is pleased to announce the acquisition of a majority interest in one of Norway's leading Executive Search, assessment and technical recruitment companies, Bjerke & Luther AS. Bjerke & Luther, which is based in Oslo will expand Harvey Nash's Nordic/Scandinavian business, Harvey Nash Alumni. The Group has also recently established a new office in Helsinki, Finland comprising two experienced Executive Search professionals to complete its geographic footprint in the Nordic region.

Bjerke & Luther specialises in providing executive consulting and leadership services to leading Norwegian companies and global technology and telecoms companies based mainly in Norway. Its market leading position, portfolio of services and client sector profile are highly complementary to Harvey Nash's European business. Bjerke & Luther has a strong track record as an independent company since its establishment in 1993 and a highly experienced management team. The acquisition will significantly enhance Harvey Nash's European footprint, and is another important step in the ongoing development of its portfolio of services across its geographic regions.

Harvey Nash has acquired 50.1 % of the shares (the "Initial Shares") in Bjerke & Luther, from SAY AS, Rich. Luther AS, Tor Ruud and Stephan Nielsen (the "Sellers") for an aggregate consideration of Norwegian Kroner 18.5m (approximately 2.1 million) plus Norwegian Kroner 300,000 in transaction costs (approximately 0.03 million) payable in cash on closing

In addition Harvey Nash has been granted a call option to acquire the additional 49.9 % of the shares in Bjerke & Luther (the "Additional Shares") from the Sellers which may be exercised between 1 February 2013 and 2 April 2013. The consideration for the acquisition of the Additional Shares shall be calculated on the same basis as the consideration for the Initial Shares, subject to a minimum aggregate consideration of NOK 11.5m (approximately 1.3 million) and a maximum of NOK 30.5m (approximately 3.4 million).

If Harvey Nash does not exercise the call option the Sellers will have an option to acquire the Initial Shares from Harvey Nash for a consideration equal to the consideration paid by Harvey Nash plus outstanding dividends. The Sellers' call option may be exercised for a period of 30 days from 3 April 2013.

The share purchase agreement contains customary warranties, subject to customary limitations, from the Sellers and Yngvar Bjerke, Ragnar Luther, the founders of Bjerke & Luther.

Bjerke & Luther, which is based in Oslo, is one of the leading Executive Search and selection companies in Norway. It was founded in 1993 by Yngvar Bjerke and Ragnar Luther and currently has 13 employees. The current management team comprises founders and majority shareholders (through SAY AS and Rich. Luther AS respectively) Yngvar Bjerke and Ragnar Luther, Tor Ruud and Stephan Nielsen. All of the management team will continue to be employed by Bjerke & Luther and to be direct or indirect shareholders following closing.

In the year ended 31 December 2009, Bjerke & Luther reported an audited profit before taxation of approximately NOK 3.3 million (approximately 0.4 million), a turnover of approximately NOK 19.9 million (approximately 2.2 million) and as at 31 December 2009 had gross assets of NOK 8.8 million (approximately 0.1 million).

The consideration will be funded from Harvey Nash's existing cash resources and facilities as appropriate.

Commenting on the acquisition, Albert Ellis, Harvey Nash Chief Executive, said:

"We are delighted with this acquisition which extends our European footprint in the important Nordic market. This is a major step forward in delivering our strategy of combining successful organic led growth with earnings enhancing, bolt on acquisitions in new and fast growing markets.

"Like Harvey Nash Alumni, Bjerke & Luther is a well established market leading business with a strong brand and client relationships. The addition of the Bjerke & Luther team will further strengthen our market position in the Nordic region and brings us the opportunity to strengthen Harvey Nash already strong position in the technical and IT industry as well as exploit markets such as resources, oil and gas where we already have 10% of our Group's activity."

The acquisition is expected to be earnings enhancing in the year ended 31 January 2012 as the full year effect of earnings is felt. In the current year the impact will be broadly neutral with integration costs, the investment in Helsinki plus up front acquisition costs.


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