Announcement for Immediate Release

27 June 2008

IAF Group Plc ("IAF" or the "Company")

Issue of Equity

The Board of IAF announces that it has raised a further £152,936 through the issue of 4,779,240 new ordinary shares of 1 pence each ("New Ordinary Shares"), representing 4.7 per cent of the enlarged issued share capital.  

The New Ordinary Shares have been issued at a price of 3.2 pence per New Ordinary Share, with warrants attached, being a discount of 5 per cent. to the closing mid market price on 26 June 2008, being the last day prior to this announcement, of 3.38 pence. The warrants will be issued on the same terms as those issued by the Company pursuant to those described in the circular sent to shareholders on 28 April 2008.  

The proceeds of the subscription will provide additional working capital for the Group.

The New Ordinary Shares have been issued to Mr R Davies, an existing shareholder, following which Mr Davies will hold 10,004,455 ordinary shares representing approximately 10.84 per cent. of the enlarged share capital.  

Application has been made for the New Ordinary Shares to be admitted to trading on AIM. The New Ordinary Shares will rank pari passu with the existing issued ordinary shares. Dealings are expected to commence on 3 July 2008.

Following the issue of the above 4,779,240 new ordinary shares, there will be a total number of 101,500,000 ordinary shares in issue at 27 June 2008. This number can be used as the denominator when determining any disclosable interest in the voting share capital of the Company. 

For further information please contact:

IAF Group Plc 

David Massie (Chairman and Chief Executive - IAF Group Plc) 

Tel: 020 7747 8940 

Dowgate Capital Advisers Limited 

Tony Rawlinson / Antony Legge

Tel: 020 7492 4777 

Bishopsgate Communications Limited 

Nick Rome / Nick Farmer 

Tel: 020 7562 3350 

nick@bishopsgatecommunications.com 

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