Axon acquires another leading SAP Consultancy in the US             01/12/2006

Axon Group plc, the leading Business Transformation consultancy, announces that its subsidiary Axon Solutions Inc. has acquired Zytalis Inc., a leading provider of SAP consulting services to corporations in the High-Technology and Discrete Manufacturing sectors.

The initial consideration is US$15m (£7.7m), payable in cash, which is approximately 0.5 times 2006 revenues. In addition, deferred cash consideration payments of up to $14.6m (£7.5m) will be paid over the course of 2008-2010 subject to business performance.

California-based Zytalis, whose clients include some of the foremost Fortune 100 companies in the US, has a ten year track record in the delivery of complex SAP solutions and, more recently, it has engaged on a number of joint assignments with Axon.

Mark Hunter, Chairman and CEO of Axon, said:
'Axon is now the largest independent SAP consultancy in the world, and we have driven significant growth in the US through the leverage of our deep expertise in the Aerospace & Defence, Utilities and Government sectors. The acquisition of Zytalis, a company with a capability, culture and focus very similar to our own, will create further opportunities for expansion into the High-Technology and Discrete Manufacturing sectors. I would like to welcome Martin and his team on board and I look forward to working with them.'

Martin Lidington, CEO and Founder of Zytalis, said:
'Axon has consistently demonstrated its ability to acquire leading industry-specialist SAP consulting companies and to integrate them in a way that gets the best out of both organisations. We are excited by this deal and we look forward to delivering increased value both for our clients and our people'

Mark Hunter added:
'Our business continues to have strong forward momentum. In addition to the strategic aspects of this deal, we also anticipate that it should increase our FY2007 revenues and profits by approximately 10%. I look forward to reporting further progress in the New Year'

For further information, please contact:

Axon
Mark Hunter/Iain McIntosh 01784 480 800

Bell Pottinger
Geoff Callow/Chris Hamilton 020 7861 3232