Released :
14/11/2011

14 November 2011
Sterling Green Group plc
("Sterling Green" or "the Company")
Partial Disposal of the Group's Debt Management Book

The Company announces that it has entered into a conditional sale and purchase agreement ("the Sale and Purchase Agreement") to dispose of the majority of its debt management book ("Debt Books) to DRSP Limited , a private limited company whose primary business function is to provide software and support services to the IVA industry ("the Disposal"). Following completion of the proposed Disposal DRSP intends to sub contract the management of the Debt Books to an established third party operating in the debt management sector.

The sale of the Debt Books will be satisfied by an estimated consideration of £ 1.05 million on completion of the proposed Disposal, subject to agreed post completion adjustments.

Under Rule 15 of the AIM Rules, as the Disposal constitutes a fundamental change to the trading business of the Company, the Sale and Purchase Agreement is conditional, inter alia, on the passing of a resolution at a general meeting of the Company to be held at 10.00am on 1 December 2011

Reasons for the Disposal

The Company was admitted to trading on AIM in April 2007 and its strategy at that time was to seek to grow the Group's debt management book with the view to build up an increasing level of monthly recurring income. Whilst the Group has been successful in growing its client base and the associated revenues derived from those clients, it has struggled in a very competitive environment, to generate sufficient income and profits to fully offset the costs associated with the Company being on AIM. The Company has seen a marked increase in costs associated with acquiring robust client leads and in order to grow the business, the Group has taken on debt to fund specific marketing campaigns and/ or payments to lead providers. As a result, the on-going running costs are now at a level that would require substantial growth in the Group's client base in order to continue to be able to service the debt and maintain the Group's lead generation programme. The Directors believe that the Group does not have the necessary capital or ability to raise sufficient capital to compete with other larger competitors and the Disposal represents the best chance for Shareholders to realise some value from their investment in the Company.

Investing Strategy

Following the Disposal, Sterling Green will have limited trading activities, which in the absence of a sale, the Directors anticipate will continue for the foreseeable future. The Group will retain cash balances of approximately £ 500,000 after repaying debt, certain other long term creditors and expenses relating to the Disposal. The Directors believe that the funds which will be in the Company could be attractive to a number of potential acquisition targets seeking admission to AIM by reversing into a liquid cash shell.

The Directors intend to seek to acquire another company or business in exchange for the issue of Ordinary Shares in a single transaction (a "reverse takeover"). The Directors' main investment criteria are that such a company should be:

* a business operating in the Software and Computer Services sector within
the UK and Europe;

* one which requires little or no funding in excess of the cash resources
available to the Company following the Disposal; and

* one whose growth prospects, if achieved, will be earnings enhancing for
shareholders.

These criteria are not intended to be exhaustive; however the Company may make an investment which does not fulfil all the investment criteria if the Directors believe that it is in the interests of Shareholders as a whole to proceed with such an investment. Any acquisition by the Company will be put to Shareholders for their approval at the appropriate time.

A circular will be sent to shareholders shortly convening a general meeting to
be held on 1 December 2011.
J M Edelson
Chairman
14 November 2011
Further enquiries:
Sterling Green Group plc Tel: 0161 975 5757

Michael Edelson

Merchant Securities Limited Tel: 020 7628 2200

Simon Clements/David Worlidge

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