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BetBull Acquires German Bookmaker

6 September 2005

LONDON – (PRESS RELEASE) -- betbull has agreed to acquire 100% of the Leip Group, one of Germany's leading retail bookmakers. The agreement is subject to several conditions precedent and expected to become effective on October 1st. This landmark deal is a cornerstone in betbull's move to establish itself as a leading Continental European retail betting player.

In the year ended 31 December 2004 the Leip Group's (unaudited) accounts showed a profit before tax of EUR1 million (EBITDA EUR 1.4 million) on bets placed of EUR51.7 million and revenue of EUR8.1 million. Overall, the Leip Group accepts bets from over 80 retail shops and operates its own high street outlets under the "Wettenleip" brand. The year 2005 to date unaudited results for the Leip Group indicate strong growth both in terms of revenue and profits.

The Directors believe that the Leip Group together with betbull has the expertise, personnel, outlets, licenses, and scale to quickly grow in the German retail betting market and to realise imminent opportunities in other Continental European countries. Alexander Leip, founder of the Leip group, will join betbull's Board of Directors as an executive and remain Managing Director of the Leip group.

The plan is to grow the retail betting business through the opening of new shops, the introduction of new products and systems and acquiring and integrating other retail betting businesses as appropriate.

The total purchase price consideration consists of EUR10.0 million and 700,000 betbull ordinary shares with customary lock up provisions. In addition, success based earn-out payments have been agreed upon subject to reaching ambitious hurdles over the next five years.

The expected closing of the transaction on October 1st entails a fund raising for betbull and is conditional, among other things, on the approval of betbull's shareholders, satisfactory auditor's reports on the interim statements of the Leip Group, and the approval of relevant Lotteries & Gaming Authorities. The extraordinary shareholders' meeting is scheduled for September 29th in London.

A more detailed account of the transaction is contained in the invitation to the extraordinary shareholders meeting which will be published on betbull's website Wednesday 7th September and will be given in the shareholders meeting itself.

betbull also announces its 2nd quarter results. During the period 1st April through 30th June 2005:

- betbull launched the German betting exchange and kicked off promotions on German race tracks. is licensed in Germany.

- Marketing spending was kept to a minimum, in line with the Company's B2B strategy, but investment was made in sponsorship deals with leading German race-courses promoting the co-operative model where racing associations and bookmakers pool bettors and liquidity and receive a profit share in exchange.

- Income from operations (still in a start up phase) increased on a quarter by quarter basis to EUR21,000 as of period end June 30th 2005.

- betbull retains a healthy cash position of GBP7.3 million or EUR10.5 million (as at 30th June 2005).

- Fixed costs were significantly reduced.

Commenting on the announcement of the acquisition of the Leip Group, Gunter Schmid, CEO of betbull said, "With the acquisition of the Leip Group, betbull will have left the start-up phase behind. We have scanned several opportunities in the European gaming sector and decided for the acquisition of the Leip Group as our preferred choice - a profitable and cash generative business in a European key market with huge growth potential. Our vision is to grow the business organically and through acquisitions building upon the lead in the rapidly expanding, yet still immature retail betting sector."

Simon Bold, COO of betbull, further added, "This is a fantastic opportunity for betbull to be a part of the retail business in Germany in the World Cup year 2006. The German retail sector is ready for the changes that we can bring about in terms of opportunities, speed and convenience. With my background in retail bookmaking I am confident that we can create substantial value there. This acquisition is only the start of our Continental European retail growth strategy."

Alexander Leip, Managing Director of Wettenleip, further added: "betbull makes an excellent fit with my business and team. I am looking forward to growing the German retail betting business to the next level together with Simon, Gunter, and their team."

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