Torch Partners - Recommended Cash Offer

Not for release, publication or distribution, in whole or in part, in the USA, Canada, Australia or Japan (EUREX: FMJP.EX - news)

1 November (Stuttgart: A0Z24E - news) 2005

Recommended cash offer

for

Redbus Interhouse plc

by

Torch Partners Corporate Finance Limited

on behalf of

TeleCity Group (Xetra: A0M59A - news) plc

Summary

The boards of directors of TeleCity Group and Redbus announce the terms of a recommended cash offer to be made by Torch Partners on behalf of TeleCity Group for the entire issued and to be issued share capital of Redbus (other than any shares in Redbus held by TeleCity Group or any of its subsidiaries on the date upon which the Offer is made). TeleCity Group is a recently incorporated company which has been established by 3i Group and the Oak Hill Investors. TeleCity Group has acquired from the 3i Investors and the Oak Hill Investors ownership of Inhoco, which has itself recently completed, through a recommended cash offer, the acquisition of TeleCity.

· The Offer will be 23p in cash for each Redbus Share, valuing the existing issued share capital of Redbus at approximately £58.9 million.

· The Offer price represents a premium of 16.5 per cent. over the Closing Price of 19.75p per Redbus Share on 31 October 2005 (being the last dealing day prior to the making of this announcement).

· The Offer price represents a premium of 53.3 per cent. over 15p, the price per share at which Redbus Shares were issued in the placing announced by Redbus on 10 February 2005.

· Redbus Shareholders will be offered a Share Alternative under which they will be able to elect to receive a combination of New TeleCity Group Shares and cash in lieu of the cash to which they would otherwise be entitled under the basic terms of the Offer.

· TeleCity Group has received irrevocable undertakings to accept the Offer, and to elect for the Share Alternative, in respect of, in aggregate, 176,301,691 Redbus Shares, representing approximately 68.8 per cent. of the existing issued share capital of Redbus.

Commenting on behalf of the directors of Redbus, Michael Tobin, Chief Executive of Redbus, said:

"This is excellent news for shareholders, employees and customers of Redbus, creating one of Europe (Chicago Options: ^REURUSD - news) 's most significant players in the industry."

Commenting on behalf of the directors of TeleCity Group, Ian Nolan, a managing director within 3i's European buyouts business and a director of TeleCity Group, said:

"Following our recent acquisition of TeleCity, we are delighted to be acquiring Redbus. We look forward to working with our new shareholders in the continued development of the enlarged Group."

This summary should be read in conjunction with the full text of this announcement, including Appendix I where the conditions of the Offer and the Share Alternative are set out.

This announcement does not constitute an offer or an invitation to purchase any securities.

Enquiries:

TeleCity Group
Ian Nolan, Director	020 7975 3349
Robert L. Morse, Director	001 650 234 0510
Torch Partners
(Financial Adviser to TeleCity Group)
Rupert Robson
Andrew Leathers	020 7917 6021
Redbus
Michael Tobin, Chief Executive Officer	020 7001 0115
Carl Fry, Finance Director	020 7001 0022
Teather ∓ Greenwood
(Financial Adviser to Redbus)
Jeff Keating
Sindre Ottesen	020 7426 9000
Weber Shandwick
(Financial PR Adviser to Redbus)
Terry Garrett	020 7067 0717

Torch Partners, which is authorised and regulated in the UK by the Financial Services Authority, is acting exclusively for TeleCity Group and for no-one else in relation to the Offer and will not be responsible to anyone other than TeleCity Group for providing the protections afforded to clients of Torch Partners or for providing or giving advice in relation to the Offer or any other matter referred to in this announcement.

Teather ∓ Greenwood, which is authorised and regulated in the UK by the Financial Services Authority, is acting exclusively for Redbus and for no-one else in relation to the Offer and will not be responsible to anyone other than Redbus for providing the protections afforded to clients of Teather ∓ Greenwood or for providing or giving advice in relation to the Offer or any other matter referred to in this announcement.

Redwood Capital Group has also provided advice to Redbus.

Unless otherwise determined by TeleCity Group, the Offer will not be made, directly or indirectly, in or into, or by use of the mails of, or by any means or instrumentality (including, without limitation, electronic mail, facsimile transmission, telex or telephone) of interstate or foreign commerce of, or any facilities of a national securities exchange of, the USA, or in or into Canada, Australia or Japan, and, subject to certain exceptions, the Offer will not be capable of acceptance by any such use, means or instrumentality or facilities or from or within the USA, Canada, Australia or Japan. The New TeleCity Group Shares to be issued pursuant to the Share Alternative have not been, nor will they be, registered under the United States Securities Act of 1933 (as amended) or under any of the relevant laws of any state or district of the USA, Canada, Australia or Japan. Accordingly, unless an exemption under such Act (Taiwan OTC: 3492.TWO - news) or other laws is available, the New TeleCity Group Shares may not be offered, sold or delivered, directly or indirectly, in the USA, Canada, Australia or Japan. Copies of this announcement are not being, and must not be, mailed or otherwise forwarded, transmitted, distributed or sent in, into or from the USA, Canada, Australia or Japan. Doing so may render invalid any purported acceptance of the Offer. Any persons (including, without limitation, nominees, trustees or custodians) who are overseas persons or who would, or otherwise intend to, forward this announcement, the Offer Document, the Equivalent Document, the Form of Acceptance or any related document to any jurisdiction outside the United Kingdom or to overseas persons should seek appropriate advice before taking any action.

This announcement has been issued by TeleCity Group and approved by Torch Partners for the purpose of section 21 of the Financial Services and Markets Act 2000. The principal place of business of Torch Partners is 211 Piccadilly, London, W1J 9HF.

Not for release, distribution or publication in the USA, Canada, Australia or Japan.

1 November 2005

Recommended cash offer

for

Redbus Interhouse plc

by

Torch Partners Corporate Finance Limited

on behalf of

TeleCity Group plc

1. Introduction

The boards of directors of TeleCity Group and Redbus announce the terms of a recommended cash offer to be made by Torch Partners on behalf of TeleCity Group for the entire issued and to be issued share capital of Redbus (other than any shares in Redbus held by TeleCity Group or any of its subsidiaries on the date upon which the Offer is made). TeleCity Group is a recently incorporated company which has been established by 3i Group and the Oak Hill Investors. TeleCity Group has acquired from the 3i Investors and the Oak Hill Investors ownership of Inhoco, which has itself recently completed, through a recommended cash offer, the acquisition of TeleCity.

Teather ∓ Greenwood, who is the financial adviser to Redbus, has informed the Redbus Board that, taking into account the factors set out below and the commercial assessment of the Redbus Board, it considers the basic cash terms of the Offer to be fair and reasonable.

2. The Offer

The Offer, which will be subject to the conditions and on the terms set out or referred to in Appendix I to this announcement and to be set out in the Offer Document and the Form of Acceptance, will be made on the following basis:

for each Redbus Share

23 pence in cash

The Offer values the existing issued share capital of Redbus at approximately £58.9 million and represents a premium of approximately 16.5 per cent. to the Closing Price of 19.75 pence per Redbus Share on 31 October 2005 (being the last dealing day prior to the making of this announcement). The Offer price also represents a premium of 53.3 per cent. over 15p, the price per share at which Redbus Shares were issued in the placing announced by Redbus on 10 February 2005.

3. The Share Alternative

Redbus Shareholders who accept the Offer may elect to receive, instead of all (but not part only) of the cash consideration to which they would otherwise be entitled under the basic terms of the Offer, a combination of New TeleCity Group Shares and cash, on the following basis:

for each £1 of cash consideration

0.24563755 New TeleCity Group Shares; and 3.93p in cash

The Share Alternative will remain open until 1.00pm on the first closing date of the Offer. If at that time the Offer is, or is capable of being declared, unconditional and it is so declared, or it is not so declared and is extended, the Share Alternative will remain open for 14 days thereafter, but may then be closed without prior notice. If the Share Alternative has been closed, TeleCity Group reserves the right to reintroduce a share alternative, subject to the rules of the City Code.

The Share Alternative is conditional upon the Offer becoming or being declared unconditional in all respects. An election for the Share Alternative will only be accepted in respect of the whole of the relevant Redbus Shareholder's registered holding of Redbus Shares.

New TeleCity Group Shares issued pursuant to the Share Alternative will be issued credited as fully paid. Such New TeleCity Group Shares will be C Shares of 1p each. Such C Shares will form a separate class from the A Shares of 1p each in TeleCity Group (held by the 3i Investors) and a separate class from the B Shares of 1p each in TeleCity Group (held by the Oak Hill Investors), but will nonetheless, on issue, rank as regards income, capital and (save as regards voting on matters, such as the appointment of directors, relevant only to one class) voting rights pari passu with such A Shares and B Shares (which currently comprise the entire issued share capital of TeleCity Group), including in respect of the right to receive and retain all dividends and other distributions declared made or paid in respect of the ordinary share capital of TeleCity Group by reference to a record date falling after such issue. The New TeleCity Group Shares will be issued free from all liens, equities, encumbrances and other interests.

Fractions of New TeleCity Group Shares will not be allotted and the number of New TeleCity Group Shares allotted to each accepting Redbus Shareholder who validly accepts the Offer and elects for the Share Alternative will be rounded down to the nearest whole number. Cash entitlements under the Share Alternative will be rounded down to the nearest penny.

The issued share capital of TeleCity Group currently comprises 10,000,000 A Shares of 1p each and 10,000,000 B Shares of 1p each. Full acceptance of the Offer in respect of the existing issued share capital of Redbus, with all relevant accepting Redbus Shareholders electing for the Share Alternative, would give rise to the allotment of approximately 14,475,833 New TeleCity Group Shares, representing approximately 42.0 per cent. of the issued share capital of TeleCity Group as enlarged by such allotment.

The holders for the time being of a majority of the issued C Shares in TeleCity Group will be entitled (as will the holders for the time being of a majority of the A Shares and the holders for the time being of a majority of the B Shares) to appoint (and remove) up to three directors to the board of TeleCity Group.

The Articles of Association of TeleCity Group contain various provisions which are of a nature generally associated with private, rather than public, companies. In particular, such Articles contain significant restrictions, namely pre-emption rights, upon the transferability of shares in TeleCity Group, together with provisions conferring "drag along" and "tag along" rights.

No application has been or will be made for the New TeleCity Group Shares to be listed or dealt in on any stock exchange. An election for the Share Alternative will therefore represent an investment in an unquoted company, with consequent limitations upon the marketability of that investment. In accordance with the Prospectus Rules, the Equivalent Document, which will contain information in relation to TeleCity Group and the rights attaching to the New TeleCity Group Shares, will be published and will accompany the Offer Document.

Redbus Shareholders should note that Teather ∓ Greenwood does not give any advice or recommendation in relation to whether or not accepting Redbus Shareholders should elect for the Share Alternative.

The TeleCity Group Directors intend that, following successful completion of the Offer, TeleCity Group will (subject to necessary shareholder approvals) be re-registered as a private company.

Torch Partners has advised that, based on market conditions on 31 October 2005 (being the last dealing day prior to the making of this announcement), in its opinion, if the New TeleCity Group Shares had been in issue on that date, the value of the consideration receivable under the Share Alternative in lieu of each £1 of cash consideration under the basic Offer would have been not less than 70.93p (comprising 3.93p in cash and a value of not less than 67p in respect of New TeleCity Group Shares).

4. Financial effects of acceptance

The financial effects of acceptance of the Offer, and election for the Share Alternative, are set out in paragraph 2 of Appendix II.

5. Undertakings to accept the Offer

TeleCity Group has received irrevocable undertakings to accept the Offer, and to elect for the Share Alternative, in respect of, in aggregate, 176,301,691 Redbus Shares, representing approximately 68.8 per cent. of the existing issued share capital of Redbus. This total is made up as follows:

Chase Nominees Limited is the registered holder, as nominee of Butterfield, of 59,206,210 Redbus Shares, representing approximately 23.11 per cent. of the existing issued share capital of Redbus. Chase Nominees Limited has given an irrevocable undertaking to accept the Offer, and to elect for the Share Alternative, in respect of all of those Redbus Shares;

Vidacos Nominees Limited is the registered holder, as nominee of Sputnik, of 59,756,082 Redbus Shares, representing approximately 23.32 per cent. of the existing issued share capital of Redbus and, as nominee of Pogan, of 9,515,000 Redbus Shares, representing 3.71 per cent. of the existing issued share capital of Redbus. Vidacos Nominees Limited has given irrevocable undertakings to accept the Offer, and to elect for the Share Alternative, in respect of all of the Redbus Shares comprised in each of those holdings;

Forest Nominees Limited is the registered holder, as nominee of UK2, of 47,568,418 Redbus Shares, representing approximately 18.57 per cent. of the existing issued share capital of Redbus. Forest Nominees Limited has given an irrevocable undertaking to accept the Offer, and to elect for the Share Alternative, in respect of all of those Redbus Shares.

In addition, three Redbus Directors, Oliver Grace, Sergei Riabtsov and Bo Bendtsen, have each irrevocably undertaken to accept the Offer, and to elect for the Share Alternative, in respect of the 85,327 Redbus Shares held by each of them respectively.

Also, Michael Tobin and Carl Fry, each of whom is a Redbus Director, have each irrevocably undertaken to accept the Offer in respect of any Redbus Shares which he may acquire while the Offer remains open for acceptance upon exercise of any outstanding options granted under the Redbus Share Option Schemes (other than the Redbus Approved Scheme) and have each further undertaken that, save as otherwise agreed with TeleCity Group, he will not elect for the Share Alternative. The maximum aggregate number of Redbus Shares which may be allotted to Michael Tobin and Carl Fry upon exercise of such options (where the exercise price is less than 23p) is 6,529,583.

All of the abovementioned undertakings will remain binding in the event of a competing offer. However, each of the abovementioned undertakings will cease to be binding if the Offer has not become or been declared unconditional in all respects by 31 March 2006 or if the terms of the Share Alternative and/or the amount of the cash consideration payable under the Offer are amended without the prior written consent of Boris Jordan, President and Chief Executive Officer of Sputnik.

6. Background to and reasons for the Offer

The TeleCity Group Directors consider that the proposed acquisition of Redbus is a logical step in the consolidation of the European data centre market. They believe that Redbus and its customers, employees and other stakeholders will benefit in three principal ways from the transaction: from (i) the creation of an entity with enhanced ability to compete in the fragmented data centre market, (ii) the backing of additional financially strong investors and (iii) the opportunities derived from the complementarity of Redbus' expanding customer base with the skill set in associated services of TeleCity Group's existing subsidiary, TeleCity.

Creation of an Entity with Enhanced Ability to Compete in the Fragmented Data Centre Market

The combination of TeleCity Group's existing subsidiary, TeleCity, with Redbus will create a business with an enlarged presence in the highly competitive European markets of London, Amsterdam, Paris and Frankfurt. The TeleCity Group Directors believe that the Enlarged Group will be in an improved position to compete for demand in those marketplaces for reliable data centre space and associated services. The TeleCity Group Directors believe that Redbus would risk being disadvantaged vis-à-vis competitors who were successful in achieving consolidation, if Redbus were not to secure this opportunity.

Backing of Additional Financially Strong Investors

The TeleCity Group Directors believe that the creation of the Enlarged TeleCity Group, with the backing of financially strong investors, will give existing and potential customers further confidence to rely on the longevity of the businesses of Redbus and TeleCity. Given the propensity of data centre customers to remain with their data centre provider for extended periods of time and their desire for uninterrupted service, the TeleCity Group Directors believe that strong financial backing is a source of competitive advantage.

Complementarity of Redbus' operations with TeleCity

Redbus has a track record of growth and the generation of sales momentum. TeleCity Group's existing subsidiary, TeleCity, has a skill set in the provision of a range of services associated with data centre space. TeleCity Group expects to benefit from Redbus' track record of momentum in attracting new customers and the application of TeleCity's ability to fulfil the service requirements of the Enlarged Group's customer base.

In order to achieve the full benefits of the acquisition, the TeleCity Group Directors believe that Redbus' business will need to be integrated with TeleCity's business. The TeleCity Group Directors believe that integration will require careful execution and that such execution is best carried out without the demands of a public listing.

7. Redbus Directors' views on issues to be considered by Redbus Shareholders

In addition to the background to and reasons for the Offer described in paragraph 6 above, it is the opinion of the Redbus Directors that Redbus Shareholders should also consider:

the risks, rewards and timescales associated with Redbus' future development and move towards pre-tax profitability;

the low liquidity of Redbus Shares, given the tightly held nature of its shareholder base, and the resulting potential difficulty for Redbus Shareholders to exit their holdings in the open market;

the Redbus Directors believe that there will be a trend towards consolidation in the collocation market. In this changing environment, and without Redbus having the size or financial capacity to take a consolidating role as an independent company, the Redbus Directors believe Redbus' long term future is best served by merging its operations with TeleCity Group;

the expected long term commercial benefits for Redbus, and therefore for its employees, as a result of Redbus becoming part of a larger group; and

the ability, if they so wish, for Redbus Shareholders to participate in the Enlarged Group going forward

In light of the factors set out above, the Redbus Directors believe that it is in the best interests of Redbus Shareholders to be afforded the opportunity, through the Offer, of realising their investment for cash at the best available price at this time or, subject to the issues raised below with regard to the risks of investment in unquoted companies, to elect to participate in the Enlarged Group.

8. Independent advice

Oliver Grace, a Redbus Director, is, through several trusts under which he is a beneficiary, interested in Butterfield. Sergei Riabtsov, a Redbus Director, is Chief Investment Officer of, and shareholder in, Sputnik (whose investments are managed by Boris Jordan, who also manages the investments of Pogan). Bo Bendtsen, a Redbus Director, is, through a trust under which he is a beneficiary, interested in UK2. Each of Butterfield, Pogan, Sputnik and UK2 is acting in concert with TeleCity Group in relation to the Offer.

In view of the interests of Oliver Grace, Sergei Riabtsov and Bo Bendtsen in parties who are acting in concert with TeleCity Group in relation to the Offer, they have declared their conflict of interest and have been precluded from participating in the consideration of the Offer by the Redbus Board and in the formulation of any advice to Redbus Shareholders.

As a consequence of their potential future involvement with Redbus and TeleCity Group at a senior level, Michael Tobin and Carl Fry also are precluded by the rules of the City Code from providing any advice or recommendation to Redbus Shareholders.

Teather ∓ Greenwood, who is financial adviser to Redbus, has informed the Redbus Board that, taking into account the factors set out above and the commercial assessment of the Redbus Board, it considers the basic cash terms of the Offer to be fair and reasonable.

Redbus Shareholders should be aware that no application has been made, or is intended to be made, for New TeleCity Group Shares to be listed or dealt in on any stock or investment exchange. An election for the Share Alternative would, accordingly, represent an investment in an unquoted company with consequent limitations on the marketability of that investment. The choice whether or not to elect for the Share Alternative is a matter for each accepting Redbus Shareholder and will depend on a number of factors such as personal financial and taxation circumstances and investment objectives. Teather ∓ Greenwood cannot, and does not, give any advice or recommendation in relation to whether or not Redbus Shareholders should elect for the Share Alternative.

9. Information relating to the Redbus Group

Redbus is a leading European provider of advanced carrier-independent collocation facilities providing the optimum operating conditions for customers to house and protect their business-critical online, data or telecom applications.

Redbus operates seven fully fitted facilities in London (three separate facilities), Frankfurt, Amsterdam, Paris and Milan providing 213,000 gross square feet of space. Each data centre offers secure collocation in a controlled environment with high standards of physical security, power availability, infrastructure and support.

The company has over 800 clients including AOL (NYSE: AOL - news) , Richards Butler, NTT Verio, AT∓T, BT (LSE: BT-A.L - news) , Vodafone (LSE: VOD.L - news) , City Index, BBC and Google (NasdaqGS: GOOG - news) .

For the year ended 31 December 2004 Redbus reported EBITDA losses of £1.1 million (2003: £2.8 million) on a turnover of £16.0 million (2003: £13.7 million).

For the six months to 30 June 2005 Redbus reported EBITDA profits of £0.1 million (2004: loss of £0.8 million) on a turnover of £9.7 million (2004: £7.6 million).

10. Information relating to the TeleCity Group

TeleCity Group is a recently incorporated company which has been established by 3i Group and the Oak Hill Investors. 50 per cent. of the issued share capital of TeleCity Group is owned by the 3i Investors and the remaining 50 per cent. by the Oak Hill Investors. The directors of TeleCity Group are Ian Nolan, a managing director within 3i's European buyouts business, and Robert L. Morse, a principal of the Oak Hill Investors.

TeleCity Group has acquired from the 3i Investors and the Oak Hill Investors ownership of Inhoco (a company established by 3i Group and the Oak Hill Investors earlier this year specifically for the purposes of acquiring TeleCity). On 18 July 2005, Inhoco announced a recommended cash offer for TeleCity, which valued the then existing share capital of TeleCity at £57.9 million. That offer was declared wholly unconditional on 5 September 2005 and on 20 September 2005 notices were sent under section 429 of the Companies Act to those TeleCity Shareholders who had not then accepted such offer, with the result that all outstanding shares in TeleCity will shortly be compulsorily acquired by Inhoco and TeleCity will become a wholly-owned subsidiary of Inhoco.

TeleCity is a leading independent provider of data centre services in Europe, operating from nine facilities across six European markets. TeleCity currently provides environments and on-site supervision to support the IT infrastructure for on-line platforms, business continuity and production environments and critical back office systems for over 600 customers.

TeleCity achieved turnover of £25.8 million and EBITDA of £1.9 million in the year ended 31 December 2004, a 10 per cent. increase on revenues, and a 63 per cent. increase on EBITDA, in the year ended 31 December 2003. TeleCity's interim results for the half year to 30 June 2005 disclosed turnover of £14.4 million, an increase of £2.2 million (18 per cent.) over the corresponding period in the prior year, and an increase to £1.4 million in EBITDA, up £0.6 million (78 per cent.) on the first half of 2004.

11. Information relating to 3i and the Oak Hill Investors

3i is a world leader in private equity and venture capital and invests across Europe, the United States and Asia. 3i Group was established in 1945, listing on the London Stock Exchange (LSE: LSE.L - news) in 1994. It is a constituent of the FTSE 100 (Euronext: VFTSE.NX - news) index. 3i manages over £6.2 billion of assets (as at 31 March 2005), comprising its own balance sheet of around £4.3 billion and private equity limited partnerships of £1.9 billion, invested alongside 3i.

The Oak Hill Investors represent over $2.5 billion of committed equity capital, available for investment in private equity transactions. Over a period of nearly 20 years, the professionals at these Oak Hill partnerships have invested in more than 50 significant private equity transactions, including GECIS Global Holdings, The Container Store, Progressive Moulded Products, TravelCenters of America, Duane Reade, WideOpenWest, Blackboard (NasdaqGS: BBBB - news) , American Savings Bank (Washington Mutual (Xetra: 893906 - news) ), Bell ∓ Howell (Proquest), Oreck Corporation and Wometco Cable Corporation.

12. Information on financing

Full acceptance of the Offer by Redbus Shareholders will (assuming that all outstanding options under the Redbus Share Option Schemes which are, or, as a result of the Offer become, exercisable, and in respect of which the exercise price is less than 23p, are exercised and the resulting Redbus Shares assented to the Offer and that there are no elections for the Share Alternative, other than in accordance with the irrevocable commitments which have been given in the undertakings described in paragraph 5 of this announcement) result in cash consideration payable by TeleCity Group of approximately £22.7 million.

Such cash consideration will be financed principally through utilisation of the facilities under the Saberasu Term Loan Agreement, pursuant to which Saberasu Japan Investment II B.V. has agreed that, subject to TeleCity Group receiving acceptances under the Offer in respect of, and/or otherwise acquiring (directly or through subsidiaries), shares representing 75 per cent. or more of the issued share capital of Redbus, they will make available to Inhoco secured facilities of up to £30 million in aggregate (which Inhoco will make available to TeleCity Group).

TeleCity Group's subsidiary, Inhoco, has also entered into the 3i/Oak Hill Term Loan Agreement, pursuant to which the 3i Investors and the Oak Hill Investors have agreed to make available to Inhoco secured facilities of up to £12.5 million in aggregate, £2.5 million of which has been utilised in the repayment by Inhoco to the 3i Investors and the Oak Hill Investors of £2.5 million of unsecured subordinated optionally convertible undated funding instruments of Inhoco (issued in connection with Inhoco's acquisition of TeleCity) and the balance of which can be used for the purpose of financing acquisitions of Redbus Shares by Inhoco and for the purpose of intra-group loans to TeleCity Group to finance the Offer.

One of the purposes for which funds drawn down under the Saberasu Term Loan Agreement can be utilised is the repayment of facilities advanced to Inhoco pursuant to the 3i/Oak Hill Term Loan Agreement.

Further details in respect of the financing of the Offer will be contained in the Offer Document.

13. Management and employees of the Redbus Group

TeleCity Group has confirmed that, if the Offer becomes or is declared wholly unconditional, the existing employment rights, including pension rights, of all employees of Redbus will be fully safeguarded.

14. Redbus Share Option Schemes

The Offer will extend to any Redbus Shares unconditionally allotted or issued pursuant to the exercise of options under the Redbus Share Option Schemes prior to the time at which the Offer closes (or such earlier time as TeleCity Group may, subject to the City Code, decide, not being earlier than the time at which the Offer becomes or is declared unconditional as to acceptances or, if later, the first closing date of the Offer). TeleCity Group will, if the Offer becomes or is declared wholly unconditional, make appropriate proposals to the holders of outstanding options under the Redbus Share Option Schemes.

15. General

(a) Appendix I to this announcement contains the conditions of the Offer and the Share Alternative and a summary of certain further terms of the Offer. Appendix II provides further information in connection with the Offer (including as regards the financial effects of acceptance) and Appendix III contains definitions of certain expressions used in this announcement.

(b) The Offer will be subject to the applicable requirements of the City Code, the Panel and London Stock Exchange plc.

(c) The Offer Document and the Equivalent Document will be posted to Redbus Shareholders in due course.

(d) Under the terms of the Merger Agreement, TeleCity Group has undertaken to Redbus that TeleCity Group will declare the Offer unconditional in all respects (if it has not previously done so), provided that:

	(i)	the condition set out in paragraph (b) of Appendix 1 to this announcement (the "Merger Control Condition") has been satisfied; and
	(ii)	valid and complete acceptances of the Offer have been received (and not withdrawn) in respect of not less than 192,168,515 Redbus Shares (representing 75 per cent. of the existing issued share capital of Redbus), including valid elections for the Share Alternative in respect of not less than 176,301,691 Redbus Shares; and
	(iii)	nothing has come to the attention of TeleCity Group which indicates that any condition of the Offer (other than the Merger Control Condition or the condition set out in paragraph (a) of Appendix 1 to this announcement) may not have been, or may not be, satisfied (or may have been, or may be, breached),

and has also undertaken to Redbus that TeleCity Group will not waive, amend, replace or withdraw the Merger Control Condition.

(e) Assuming that TeleCity Group receives acceptances under the Offer in respect of and/or otherwise acquires 75 per cent. or more of the Redbus Shares and the Offer becomes or is declared unconditional in all respects, TeleCity Group intends to procure the making of an application by Redbus to London Stock Exchange plc for the cancellation of the admission to trading of Redbus Shares on AIM and also intends that Redbus will be re-registered as a private company. It is anticipated that such cancellation of admission to trading will take effect no earlier than twenty business days after the date on which the Offer becomes or is declared unconditional in all respects. The cancellation of the admission of Redbus Shares to AIM will significantly reduce the liquidity and marketability of any Redbus Shares not assented to the Offer and their value may be affected in consequence.

(f) TeleCity Group intends, assuming that it receives sufficient acceptances under the Offer to entitle it to do so, to use the procedures set out in sections 428 to 430F (inclusive) of the Companies Act to acquire compulsorily, on the same terms as the Offer, any outstanding Redbus Shares not assented to the Offer.

(g) It is also proposed that, following successful completion of the Offer, each of Inhoco and TeleCity will be re-registered as a private company and that some form of consolidation will be effected between TeleCity and Redbus.

(h) Any person who, alone or acting together with any other person(s) pursuant to an agreement or understanding (whether formal or informal) to acquire or control securities of Redbus, owns or controls, or becomes the owner or controller, directly or indirectly, of one per cent. or more of any class of securities of Redbus or TeleCity Group is generally required under the provisions of Rule 8 of the City Code to notify London Stock Exchange plc and the Panel of every dealing in such securities during the Offer Period.

(i) Unless otherwise stated, the financial information relating to Redbus which is stated in this announcement has been extracted from the audited annual report and accounts of Redbus for the year ended 31 December 2004 or, as appropriate, Redbus' announcement of its unaudited interim results for the six months ended 30 June 2005.

(j) Unless otherwise stated, the financial information relating to TeleCity which is stated in this announcement has been extracted from the audited annual report and accounts of TeleCity for the year ended 31 December 2004 or, as appropriate, TeleCity's announcement of its unaudited interim results for the six months ended 30 June 2005.

(k) The Offer values the whole of the issued share capital of Redbus at approximately £58.9 million, based on the Offer price of 23 pence in cash and 256,224,686 Redbus Shares being in issue as at 31 October 2005 (as sourced from the register of members of Redbus as at 31 October 2005).

Enquiries:

TeleCity Group
Ian Nolan, Director	020 7975 3349
Robert L. Morse, Director	001 650 234 0510
Torch Partners
(Financial Adviser to TeleCity Group)
Rupert Robson
Andrew Leathers	020 7917 6021
Redbus
Michael Tobin, Chief Executive Officer	020 7001 0115
Carl Fry, Group Finance Director	020 7001 0022
Teather ∓ Greenwood
(Financial Adviser to Redbus)
Jeff Keating
Sindre Ottesen	020 7426 9000
Weber Shandwick
(Financial PR Adviser to Redbus)
Terry Garrett	020 7067 0717
Redwood Capital Group
(who have given advice to Redbus)
Jeen Pae

This announcement does not constitute an offer or an invitation to sell, purchase or subscribe for any securities. The laws of relevant overseas jurisdictions may affect or prohibit the availability of the Offer and/or the Share Alternative to persons not resident in the United Kingdom or who are citizens, residents or nationals of jurisdictions outside the United Kingdom or who are nominees of, or custodians or trustees for, citizens, residents or nationals of other countries. Such persons should inform themselves about, and observe, any applicable requirements. Further details in relation to overseas shareholders will be contained in the Offer Document.

Torch Partners, which is authorised and regulated in the UK by the Financial Services Authority, is acting exclusively for TeleCity Group and no-one else in connection with the Offer and will not be responsible to anyone other than TeleCity Group for providing the protections offered to clients of Torch Partners or for providing or giving advice in relation to the Offer or any other matter referred to in this announcement.

Teather ∓ Greenwood, which is authorised and regulated in the UK by the Financial Services Authority, is acting exclusively for Redbus and for no-one else in relation to the Offer and will not be responsible to anyone other than Redbus for providing the protections afforded to clients of Teather ∓ Greenwood or for providing or giving advice in relation to the Offer or any other matter referred to in this announcement.

Redwood Capital Group has also provided advice to Redbus.

The TeleCity Group Directors, the 3i Investment Committee and the Oak Hill Investment Committees accept responsibility for the information contained in this announcement, other than that relating to Redbus, the Redbus Group, the Redbus Directors and members of their immediate families, related trusts and persons connected with them (within the meaning of section 346 of the Companies Act) and other than the opinion of Teather ∓ Greenwood contained in paragraph 8 of this announcement and except that neither the TeleCity Group Directors nor the Oak Hill Investment Committees accept responsibility for information contained in this document relating to 3i Group or any of its subsidiaries, the 3i Investors or the 3i Investment Committee and neither the TeleCity Group Directors nor the 3i Investment Committee accept responsibility for information contained in the document relating to the Oak Hill Investors or the Oak Hill Investment Committees. To the best of the knowledge and belief of the TeleCity Group Directors, the 3i Investment Committee and the Oak Hill Investment Committees (each of whom has taken all reasonable care to ensure that such is the case), the information contained in this announcement for which they respectively accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.

The Redbus Directors accept responsibility for the information contained in this announcement relating to Redbus, the Redbus Group and the Redbus Directors and members of their immediate families, related trusts and persons connected with them (within the meaning of section 346 of the Companies Act), other than the opinion of Teather ∓ Greenwood contained in paragraph 8 of this announcement. To the best of the knowledge and belief of the RedbusDirectors (who have taken all reasonable care to ensure that such is the case), the information contained in this announcement for which they accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.

This announcement has been issued by TeleCity Group and approved by Torch Partners for the purpose of section 21 of the Financial Services and Markets Act 2000. The principal place of business of Torch Partners is 211 Piccadilly, London, W1J 9HF.

Appendix I

Conditions

Conditions of the Offer

The Offer is subject to the following conditions:

valid acceptances being received (and not, where permitted, withdrawn) by 1.00 p.m. on the first closing date of the Offer (or such later time(s) and/or date(s) as TeleCity Group may, with the consent of the Panel or in accordance with the rules of the City Code, decide) in respect of not less than 90 per cent. (or such lesser percentage as TeleCity Group may decide) of the Redbus Shares to which the Offer relates, provided that this condition will not be satisfied unless TeleCity Group and/or any of its wholly-owned subsidiaries shall have acquired or agreed to acquire, whether pursuant to the Offer or otherwise, Redbus Shares carrying, in aggregate, more than 50 per cent. of the voting rights then normally exercisable at a general meeting of Redbus (on such basis as may be required by the Panel, including for this purpose (to the extent, if any, required by the Panel) any voting rights attaching to any Redbus Shares which are unconditionally allotted or issued before the Offer becomes or is declared unconditional as to acceptances, whether pursuant to the exercise of conversion or subscription rights or otherwise); and for this purpose:

	(i)	the expression "Redbus Shares to which the Offer relates" shall be construed in accordance with sections 428 to 430F of the Companies Act; and
	(ii)	shares which have been unconditionally allotted shall be deemed to carry the voting rights which they will carry upon issue;
(b)	(iii)	the German Federal Cartel Office informing TeleCity Group that the Acquisition may be put into effect in accordance with section 40(1) of the German Act against Restraints of Competition 1958 (as amended); or
	(iv)	the period specified in section 40(1) of the German Act against Restraints of Competition 1958 (as amended) lapsing without the German Federal Cartel Office having informed TeleCity Group of the determination it has made (if any) under section 40(1) of the German Act against Restraints of Competition 1958 (as amended);
(c)	no Relevant Authority having taken, instituted, implemented or threatened any action, suit, proceeding, investigation, enquiry or reference, or made, proposed or enacted any statute, regulation, decision or order or required any action to be taken or information to be provided or otherwise having taken or refrained from having taken any other action, and there not continuing to be in force any statute, regulation, rule, order or decision that, in any such case, will or could reasonably be expected to:
	(i)	make the Offer or its implementation or the acquisition or proposed acquisition by TeleCity Group (or any other member of the Wider TeleCity Group) of any Redbus Shares or control or management of Redbus or any member of the Wider Redbus Group void, voidable, unenforceable or illegal under the laws of any jurisdiction, or otherwise, directly or indirectly, restrain, restrict, prohibit or delay, or impose material additional or amended conditions or obligations with respect to, or otherwise challenge or interfere with, any of the foregoing; or
	(ii)	require, prevent, delay, restrict, or alter the proposed terms for, the divestiture by any member of the Wider TeleCity Group or any member of the Wider Redbus Group of all or any part of their respective businesses, assets or properties, to such an extent as is material in the context of the Wider TeleCity Group taken as a whole or, as the case may be, the Wider Redbus Group taken as a whole, or impose any material limitation on the ability of any of them to conduct or to own, use or operate all or any part of the respective businesses, assets or properties owned by, or the use or operation of which is enjoyed by, any of them, or result in any of them ceasing to be able to carry on business, or being materially restricted in its carrying on of business, under any name under which it currently does so; or
	(iii)	impose any material limitation on the ability of any member of the Wider TeleCity Group or any member of the Wider Redbus Group, directly or indirectly, to acquire or to hold or to exercise effectively any rights of ownership of shares or other securities (or the equivalent) in any member of the Wider Redbus Group or any member of the Wider TeleCity Group, or to exercise management or voting control over any member of the Wider Redbus Group; or
	(iv)	require any member of the Wider TeleCity Group or any member of the Wider Redbus Group to acquire, or to offer to acquire, any shares or other securities or indebtedness (or the equivalent) in or of, or any asset owned by, any other person, or to dispose of or repay, or to offer to dispose of or repay, any shares or other securities or indebtedness (or the equivalent) in or of, or any asset owned by, any member of the Wider TeleCity Group or the Wider Redbus Group; or
	(v)	otherwise adversely affect the business, assets, financial or trading position or profits, prospects or value of any member of the Wider Redbus Group or any member of the Wider TeleCity Group in a manner which is material in the context of the Offer or either such Group taken as a whole,
	and all applicable waiting and other time periods during which any Relevant Authority could decide to take, institute, implement or threaten any such action, suit, proceeding, investigation, enquiry or reference having expired, lapsed or been terminated;
(d)	all necessary filings having been made and all statutory or regulatory obligations in any jurisdiction having been complied with, and all appropriate waiting or other time periods under any applicable legislation or regulations of any jurisdiction having expired, lapsed or been terminated, in each case in connection with the Offer or the acquisition or proposed acquisition of any Redbus Shares, or of control or management of Redbus (or any other member of the Wider Redbus Group) by TeleCity Group (or any other member of the Wider TeleCity Group) and all Relevant Authorisations reasonably deemed by TeleCity Group to be necessary or appropriate for, or in respect of, the Offer or any acquisition or proposed acquisition of any Redbus Shares, or of control or management of Redbus (or any other member of the Wider Redbus Group), by TeleCity Group (or any other member of the Wider TeleCity Group) or to permit or enable TeleCity Group (or any other member of the Wider TeleCity Group) to carry on the business of any member of the Wider Redbus Group having been obtained in terms and in a form reasonably satisfactory to TeleCity Group, from all appropriate Relevant Authorities and from all appropriate persons, authorities or bodies with whom any member of the Wider TeleCity Group or the Wider Redbus Group has entered into contractual arrangements, and all such Relevant Authorisations remaining in full force and effect, and there being no notice or intimation of any intention to revoke, modify, restrict, suspend or not to renew any of them;
(e)	save as Disclosed prior to the date of this announcement, there being no provision of any Relevant Instrument which, in consequence of the making or implementation of the Offer, the acquisition or proposed acquisition by any member of the Wider TeleCity Group of any Redbus Shares or any change in the control or management of Redbus or any other member of the Wider Redbus Group, or otherwise, provides for, or will or could reasonably be expected to result in, any of the following (in each case to an extent which is material in the context of the Wider Redbus Group as a whole):
	(i)	any money borrowed by, or any other indebtedness (actual or contingent) of, any member of the Wider Redbus Group being or becoming repayable or capable of being declared repayable immediately or prior to its stated maturity, or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or inhibited; or
	(ii)	the creation of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any member of the Wider Redbus Group or any such security (whenever arising or having arisen) becoming enforceable or being enforced; or
	(iii)	any Relevant Instrument or any right, liability, obligation, interest or business of any member of the Wider Redbus Group (or any related arrangement) being terminated or adversely modified or adversely affected, or any adverse action being taken, or any obligation arising, under any Relevant Instrument; or
	(iv)	any asset or right (including, without limitation, intellectual property rights) or interest of, or any asset or right the use or operation of which is enjoyed by, any member of the Wider Redbus Group being or falling to be disposed of other than in the ordinary course of business, or charged, or ceasing to be available to any such member, or any right arising under which any such asset, right or interest will or could be required to be disposed of or charged, or will or could cease to be so available; or
	(v)	the interest or business of any member of the Wider Redbus Group in or with any company, firm, body or person, or any arrangements relating to any such interest or business, being terminated or adversely modified or affected; or
	(vi)	the creation of liabilities, whether actual or contingent, of any member of the Wider Redbus Group, or the business, assets, financial or trading position or profits, prospects or value of any member of the Wider Redbus Group being prejudiced or adversely affected; or
	(vii)	any member of the Wider Redbus Group ceasing to be able, or being restricted in being able, to carry out business under any name under which it currently does so; or
	(vii)	any member of the Wider Redbus Group or any member of the Wider TeleCity Group being required to acquire, or to offer to acquire, any shares or other securities or indebtedness (or the equivalent) in or of, or any asset owned by, any other person or to dispose of or repay, or to offer to dispose of or repay, any shares or other securities or indebtedness (or the equivalent) in or of, or any asset owned by, any member of the Wider Redbus Group or the Wider TeleCity Group,
	and no event having occurred which, under any provision of any Relevant Instrument, would or could reasonably be expected to result in any of the events or circumstances referred to in sub-paragraphs (i) to (viii) of this paragraph (e);
(f)	save as Publicly Announced or Disclosed prior to the date of this announcement, no member of the Wider Redbus Group having, since 31 December 2004:
	(i)	made (in the case of Redbus) any alteration to its memorandum or articles of association or (in the case of any other member of the Wider Redbus Group) any alteration to its memorandum or articles of association or other constitutional documents which is or could reasonably be considered to be material; or
	(ii)	recommended, declared, paid or made, or proposed the recommendation, declaration, paying or making of, any dividend, bonus or other distribution, whether in cash or otherwise (other than to Redbus or a wholly-owned subsidiary of Redbus); or
	(iii)	issued or agreed to issue, authorised or proposed the issue of additional shares of any class, or of securities convertible into, or rights, warrants or options to subscribe for or acquire, any such shares or securities or any loan capital (other than issues to Redbus or a wholly-owned subsidiary of Redbus, and save for options granted prior to the date of this announcement under the Redbus Share Option Schemes, and save for Redbus Shares allotted on the exercise of any such option) or redeemed, purchased or reduced, or authorised or proposed the redemption, purchase or reduction of, any part of its share capital; or
	(iv)	(other than to Redbus or a wholly-owned subsidiary of Redbus) issued, authorised or proposed the issue of any debentures or securities or, save in the ordinary course of business, incurred or increased any indebtedness or contingent liability which is (alone or in aggregate) material in the context of the Wider Redbus Group as a whole; or
	(v)	entered into or varied or implemented, or authorised, proposed or announced its intention to enter into, vary or implement, any contract, scheme, transaction, commitment (whether in respect of capital expenditure or otherwise) or other arrangement which is outside the ordinary course of trading or which is, or will or could reasonably be expected to be, restrictive on the business of any member of the Wider Redbus Group or which involves, or will or could reasonably be expected to involve, an obligation of an onerous or unusual nature or magnitude which in any such case is material in the context of the Wider Redbus Group as a whole; or
	(vi)	authorised or proposed, or effected, any merger, demerger, reconstruction or amalgamation, or any acquisition or disposal or transfer of, or any mortgage, charge or other security interest or third party right or encumbrance in respect of, any right, title or interest in any shares or other asset (other than in the ordinary course of trading) which in any such case is material in the context of the Wider Redbus Group as a whole; or
	(vii)	entered into, or varied (other than in respect of increases to remuneration required under the terms of the relevant agreement) the terms of, or made any offer (which remains capable of acceptance) to enter into or vary the terms of, any service contract, or other agreement or arrangement, with any of the directors or senior executives or senior employees of any member of the Wider Redbus Group; or
	(viii)	been unable or admitted in writing that it is unable to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or a substantial part thereof or ceased or threatened to cease carrying on all or a substantial part of its business; or
	(ix)	taken or proposed any action or had any proceedings instituted, threatened or proposed for its winding-up (voluntary or otherwise) or dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar or analogous officer of all or any of its assets or revenues or for any similar or analogous matters in any jurisdiction; or
	(x)	waived or compromised any claim, other than in the ordinary course of business; or
	(xi)	entered into any commitment, agreement or arrangement, or passed any resolution or made any offer, with respect to, or announced an intention to effect or to propose, any of the transactions, matters or events referred to in this paragraph (f);
(g)	since 31 December 2004, and save as Publicly Announced or Disclosed prior to the date of this announcement:
	(i)	no material adverse change or deterioration having occurred in the business, assets, financial or trading position or profits, prospects or value of any member of the Wider Redbus Group which is or could reasonably be expected to be material in the context of the Wider Redbus Group as a whole;
	(ii)	no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the Wider Redbus Group is or may become a party (whether as a claimant, defendant or otherwise), and no investigation or enquiry by, or complaint or reference to, any Relevant Authority against or in respect of any member of the Wider Redbus Group, having been instituted, announced or threatened or remaining outstanding, which in any such case is or could reasonably be expected to be material and adverse in the context of the Wider Redbus Group as a whole;
	(iii)	no steps having been taken which will result in, or could reasonably be expected to result in, the withdrawal, cancellation, termination or adverse modification of any licence or permit held by any member of the Wider Redbus Group in circumstances where such withdrawal, cancellation, termination or adverse modification could reasonably be expected to have a material adverse effect upon the Wider Redbus Group taken as a whole; and
	(iv)	no contingent or other liability having arisen or increased or become apparent which might reasonably be expected adversely to affect any member of the Wider Redbus Group and which is or could reasonably be expected to be material in the context of the Wider Redbus Group as a whole;
(h)	TeleCity Group not having discovered:
	(i)	that any financial or business or other information concerning the Wider Redbus Group as contained in the information publicly disclosed at any time by or on behalf of any member of the Wider Redbus Group, or disclosed at any time by or on behalf of any member of the Wider Redbus Group in writing in connection with the Offer to any member of the Wider TeleCity Group or its agents or advisers, is materially misleading or contains a material misrepresentation of fact or omits to state a fact necessary to make the information contained therein not materially misleading; or
	(ii)	any information which materially affects the import of any such information as is mentioned in sub-paragraph (i) of this paragraph (h); or
	(iii)	that any undertaking in which any member of the Wider Redbus Group has a significant economic interest and which is not a subsidiary of Redbus is subject to any liability, contingent or otherwise, which is not, prior to the date of this announcement, Publicly Announced or Disclosed and which is, or could reasonably be expected to be, material in the context of the Wider Redbus Group as a whole; or
	(iv)	that any circumstance exists whereby a person or class of persons would be likely to have any claim or claims in respect of any service now or previously carried out by any past or present member of the Wider Redbus Group and which is, or could reasonably be expected to be, material in the context of the Wider Redbus Group as a whole; and
(I)	save as Disclosed prior to the date of this announcement, TeleCity Group not having discovered:
	(i)	that there has been any release, emission, disposal, spillage or leak of any waste or hazardous substance or any substance likely to impair the environment or harm human health on or about or from any property or water now or previously owned, occupied, used or controlled by any past or present member of the Wider Redbus Group (whether or not constituting a non-compliance by any person with any applicable law, statute, ordinance or any regulation, rule or other requirement of any Relevant Authority) which, in any such case, will or would be likely to give rise to any liability (whether actual or contingent) on the part of any member of the Wider Redbus Group which is, or could reasonably be expected to be, material in the context of the Wider Redbus Group as a whole; or
	(ii)	that any past or present member of the Wider Redbus Group has not complied with any applicable laws, statutes or ordinances, or any regulations, rules or other requirements of any Relevant Authority, relating to the disposal, discharge, spillage, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or harm human health, or otherwise relating to environmental matters, which is, or could reasonably be expected to be, material in the context of the Wider Redbus Group taken as a whole; or
	(iii)	that there is, or is reasonably likely to be, any liability (actual or contingent) on the part of any member of the Wider Redbus Group to make good, repair, reinstate or clean up any property or water now or previously owned, occupied or used or controlled by any past or present member of the Wider Redbus Group under any environmental legislation, regulation, notice, circular, order or requirement of any Relevant Authority which is, or could reasonably be expected to be, material in the context of the Wider Redbus Group as a whole.

TeleCity Group reserves the right to waive all or any of the above conditions, in whole or in part, except condition (a). TeleCity Group shall be under no obligation to waive or treat as satisfied any of the other conditions by a date earlier than the latest date specified above for the satisfaction thereof (or, if no such date is specified, the date when the Offer, if such be the case, shall become or be declared unconditional in all respects) notwithstanding that the other conditions of the Offer may at an earlier date have been waived or fulfilled and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment.

The Offer will lapse unless the conditions set out above (other than condition (a)) are fulfilled or (if capable of waiver) waived or, where appropriate, have been determined by TeleCity Group to be or to remain satisfied no later than midnight on the twenty-first day after the later of the first closing date of the Offer and the date on which the Offer becomes or is declared unconditional as to acceptances, or such later date as the Panel may agree.

If TeleCity Group is required by the Panel to make an offer for Redbus Shares under the provisions of Rule 9 of the City Code, TeleCity Group may make such alterations to any of the conditions (including, without limitation, condition (a) above), or any of the terms of the Offer as are necessary to comply with the provisions of that Rule.

The Share Alternative

The Share Alternative is conditional upon the Offer becoming or being declared unconditional in all respects.

Appendix II

Further information

1. Further details of the Offer

1.1 The formal Offer by Torch Partners will be subject to the terms and conditions set out in Appendix I and this Appendix II and as will be set out in the Offer Document and accompanying Equivalent Document and Form of Acceptance, or as may be required to comply with the provisions of the City Code.

1.2 The Offer will not extend to any shares in Redbus held by TeleCity Group or any of its subsidiaries on the date upon which the Offer is made, but will extend to any Redbus Shares unconditionally allotted or issued prior to the time at which the Offer closes (or such earlier time as TeleCity Group may, subject to the City Code, decide, not being earlier than the time at which the Offer becomes or is declared unconditional as to acceptances or, if later, the first closing date of the Offer), whether pursuant to the Redbus Share Option Schemes or otherwise.

1.3 The Redbus Shares are to be acquired fully paid and free from all liens, charges and encumbrances, rights of pre-emption and any other third party rights or interests and together with all rights attaching thereto, including the right to receive and retain all dividends or other distributions declared, paid or made on or after the date of this announcement.

1.4 The Offer will lapse if, in respect of the Acquisition: (a) there is a reference to the Competition Commission or (b) the European Commission either (i) initiates proceedings under Article 6(1)(c) of Council Regulation (EEC) 4064/89 or (ii) makes a referral to a competent authority in the United Kingdom under Article 9(1) thereof and, following such referral, there is a reference to the Competition Commission, in any such case before 1.00 p.m. on the first closing date of the Offer or the time and date on which the Offer becomes or is declared unconditional as to acceptances, whichever is the later. If the Offer lapses, the Offer will cease to be capable of further acceptance and Redbus Shareholders and TeleCity Group will thereupon cease to be bound by any Form of Acceptance submitted before the time when the Offer lapses.

2. Financial effects of acceptance

The following table sets out, for illustrative purposes only and on the bases and assumptions set out in the notes below, the financial effects of acceptance of the Offer on capital value for an accepting holder of 100 Redbus Shares (with and without election for the Share Alternative), assuming that the Offer becomes or is declared unconditional in all respects:

		Cash	Share
	Notes		Alternative
		£	£
Cash consideration for 100 Redbus Shares under the Offer		23.00	-
Estimated value of New TeleCity Group Shares and cash receivable in respect of 100 Redbus Shares under the Share Alternative	(i) (ii)	-	16.31
Market value of 100 Redbus Shares	(iii)	19.75	19.75
Increase (decrease) in capital value		3.25	(3.44)
This represents a percentage increase (decrease) of approximately		16.5%	(17.4%)

Notes:

(i) The estimated value of New TeleCity Group Shares and cash is based upon Torch Partners' opinion (as referred to in paragraph 3 of this announcement) that, had the New TeleCity Group Shares been in issue on 31 October 2005 (and based on market conditions on that day), the value of the consideration receivable under the Share Alternative in lieu of each £1 of cash consideration under the basic Offer would have been not less than 70.93p.

(ii) The estimated value of the New TeleCity Group Shares and cash takes no account of the rounding down to the nearest whole number of the number of New TeleCity Group Shares to be allotted.

(iii) The market value of 100 Redbus Shares is based on the Closing Price of 19.75p per Redbus Share on 31 October 2005 (being the last dealing day prior to the making of this announcement).

3 Overseas shareholders

3.1 The making of the Offer to certain persons not resident in the United Kingdom, or who are citizens, residents or nationals of jurisdictions outside the United Kingdom, or who are nominees of, or custodians or trustees for, citizens, residents or nationals of other countries (overseas shareholders), may be prohibited or affected by the laws of the relevant overseas jurisdictions. Such overseas shareholders should inform themselves about and observe any applicable legal requirements. It is the responsibility of any overseas shareholder wishing to accept the Offer to satisfy himself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required, compliance with other formalities needing to be observed and the payment of any issue, transfer or other taxes due in such jurisdiction. Any such overseas shareholder will be responsible for payment of any issue, transfer or other taxes, duties or other requisite payment(s) due in such jurisdiction(s), by whomsoever payable, and TeleCity Group and any person acting on its behalf shall be entitled to be fully indemnified and held harmless by such overseas shareholder for any issue, transfer or other taxes or duties or other requisite payments as TeleCity Group or any person acting on behalf of TeleCity Group may be required to pay in respect of the Offer insofar as they relate to such overseas shareholder.

3.2 The Offer will not be made, directly or indirectly, in or into, or by use of the mails of, or by any means or instrumentality of interstate or foreign commerce of, or any facilities of a national securities exchange of, the USA, or in or into Canada, Australia or Japan, and, subject to certain exceptions, the Offer will not be capable of acceptance by any such use, means or instrumentality or facilities or from or within the USA, Canada, Australia or Japan.

3.3 The New TeleCity Group Shares to be issued pursuant to the Share Alternative have not been, nor will they be, registered under the United States Securities Act of 1933 (as amended) or under any of the relevant securities laws of any state or district of the USA, Canada, Australia or Japan. Accordingly, unless an exemption under such Act or other laws is available, the New TeleCity Group Shares may not be offered, sold or delivered, directly or indirectly, in the USA, Canada, Australia or Japan.

3.4 Copies of this announcement are not being, and must not be, mailed or otherwise forwarded, transmitted, distributed or sent in, into or from the USA, Canada, Australia or Japan. Doing so may render invalid any purported acceptance of the Offer. Any persons (including, without limitation, nominees, trustees or custodians) who are overseas persons or who would, or otherwise intend to, forward this announcement, the Offer Document, the Equivalent Document, the Form of Acceptance or any related document to any jurisdiction outside the United Kingdom or to overseas persons should seek appropriate advice before taking any action.

4 Disclosure of interests

4.1 As at the date of this announcement:

(a) Butterfield owns 59,206,210 Redbus Shares, representing approximately 23.11 per cent. of the existing issued share capital of Redbus;

(b) Sputnik owns 59,756,082 Redbus Shares, representing approximately 23.32 per cent. of the existing issued share capital of Redbus;

(c) UK2 owns 47,568,418 Redbus Shares, representing approximately 18.57 per cent. of the existing issued share capital of Redbus;

(d) Pogan owns 9,515,000 Redbus Shares, representing approximately 3.71 per cent. of the existing issued share capital of Redbus;

(e) The Redbus Shares owned by Sputnik and Pogan (totalling 69,271,082 Redbus Shares, representing approximately 27.04 per cent. of the existing issued share capital of Redbus) are controlled by Boris Jordan (President and Chief Executive Officer of Sputnik), who manages the investments of both Sputnik and Pogan (and who is the holder of approximately 36 per cent. of the issued share capital of Sputnik);

(f) Oliver Grace, a Redbus Director, owns 85,327 Redbus Shares, representing approximately 0.03 per cent. of the existing issued share capital of Redbus, and is also, through several trusts under which he is a beneficiary, interested in the Redbus Shares owned by Butterfield, as referred to in (a) above;

(g) Bo Bendtsen, a Redbus Director, owns 85,327 Redbus Shares, representing approximately 0.03 per cent. of the existing issued share capital of Redbus, and is also, through a trust under which he is a beneficiary, interested in the Redbus Shares owned by UK2, as referred to in (c) above;

(h) Sergei Riabtsov, a Redbus Director, owns 85,327 Redbus Shares, representing approximately 0.03 per cent. of the existing issued share capital of Redbus.

4.2 The shareholdings in Redbus of Butterfield, Sputnik, UK2, Pogan, Oliver Grace, Bo Bendtsen and Sergei Riabtsov described in paragraph 4.1 above are subject to irrevocable undertakings to accept the Offer, and to elect for the Share Alternative, which have been given to TeleCity Group, in the case of Butterfield, Sputnik, UK2 and Pogan, by the respective registered holders of those Redbus Shares.

4.3 Oliver Grace, Sergei Riabtsov and Bo Bendtsen each receive fees from Redbus for their services as non-executive directors, at the rate of £3,750 per quarter and such fees, after deduction of applicable taxes (the net amount being £2,925 per quarter), are then applied in subscription for new shares in Redbus at the prevailing market price. Such fees are outstanding in respect of the period since 1 October 2004 and accordingly, during the period while the Offer remains open, each of them will acquire additional shares with a market value of £11,700 (50,869 shares at the Offer price of 23p per share) and may, depending upon when (and whether) the Offer becomes or is declared unconditional in all respects, become entitled to acquire further shares on the same basis by reference to the period since 1 October 2005. These additional Redbus Shares will be subject to the irrevocable undertakings given to TeleCity Group by Oliver Grace, Sergei Riabtsov and Bo Bendtsen, as described in paragraph 5 of this announcement.

4.4 Save (Milan: SAVE.MI - news) as disclosed in this announcement, neither TeleCity Group, nor any of its subsidiaries, nor any of the TeleCity Group Directors, nor any member of the immediate family, or related trust, of a TeleCity Group Director, nor, so far as TeleCity Group is aware, any person acting, or deemed to be acting, in concert with TeleCity Group for the purposes of the Offer, owns or controls any Redbus Shares or holds any options to purchase any Redbus Shares or holds any derivatives referenced to Redbus Shares, or has any arrangement in respect of any Redbus Shares.

4.5 For the purposes of paragraph 4.4 above, "arrangement" includes any indemnity or option arrangement and any agreement or understanding, formal or informal, of whatever nature relating to RedbusShares which may be an inducement to deal or refrain from dealing in Redbus Shares.

4.6 In the interests of confidentiality, TeleCity Group has not made enquiries in this respect of certain of the persons who may be deemed by the Panel to be acting in concert with TeleCity Group for the purposes of the City Code. Such enquiries will now be made and any relevant information so obtained will be disclosed to the Panel and will be incorporated in the Offer Document (and, if required by the Panel, will be the subject of a separate announcement).

Appendix III

Definitions

The following definitions apply throughout this announcement unless the context requires otherwise:

3i Group	3i Group plc
3i Investments	3i Investments plc, a wholly owned subsidiary of 3i Group
3i Investment Committee	the members of the Investment Committee of 3i Investments for the purposes of the Acquisition
3i Investors	3i Group and 3i Pan European Buy-outs 2004-06, L.P.
3i/Oak Hill Term Loan Agreement	a facility agreement dated 31 October 2005 made between (1) Inhoco and (2) the 3i Investors and the Oak Hill Investors
Acquisition	the proposed acquisition by TeleCity Group of Redbus pursuant to the Offer
AIM	the market known as AIM and operated by London Stock Exchange plc
AIM Rules	the AIM rules published by London Stock Exchange plc and for the time being in force
associated undertaking	to be construed in accordance with the Companies Act (but for this purpose ignoring paragraph 20(1)(b) of Schedule 4A thereto)
Australia	Australia, its possessions and territories and all areas subject to its jurisdiction and any political subdivision thereof
Butterfield	Butterfield Trust (Bermuda) Limited (a company incorporated in Bermuda)
Canada	Canada, its possessions and territories and all areas subject to its jurisdiction and any political subdivision thereof
City Code	the City Code on Takeovers and Mergers
Closing Price	the closing middle market quotation of a Redbus Share as derived from the AIM appendix to the Daily Official List
Companies Act	the Companies Act 1985, as amended
Daily Official List	the Daily Official List published by London Stock Exchange plc
Disclosed	fairly disclosed in writing by or on behalf of Redbus or its advisers to TeleCity Group or its advisers in connection with the Offer
EBITDA	earnings before interest, taxation, depreciation and amortisation
Enlarged Group or Enlarged TeleCity Group	the Group as enlarged by the Acquisition
Equivalent Document	the document which will be of even date with the Offer Document and which will contain equivalent information to that of a prospectus for the purposes of Rule 1.2.2(2) of the Prospectus Rules in relation to the New TeleCity Group Shares
Form of Acceptance	the form of acceptance, election and authority for use in connection with the Offer
Group	TeleCity Group and its existing subsidiary undertakings
Inhoco	Inhoco 3236 plc (registered in England and Wales with number 5505790), a subsidiary of TeleCity Group
ISP	internet service provider
Japan	Japan, its possessions and territories and all areas subject to its jurisdiction and any political subdivision thereof
Merger Agreement	the merger agreement dated 31 October 2005 made between (1) TeleCity Group and (2) Redbus
New TeleCity Group Shares	the new C Shares of 1p each in TeleCity Group to be issued pursuant to the Share Alternative
Oak Hill CP	Oak Hill Capital Partners II (Cayman), L.P. (an exempted limited partnership organised under the laws of the Cayman Islands)
Oak Hill CP II	Oak Hill Capital Partners II (Cayman II), L.P. (an exempted limited partnership organised under the laws of the Cayman Islands)
Oak Hill CP-Management	Oak Hill Capital Management Partners II (Cayman) , L.P. (an exempted limited partnership organised under the laws of the Cayman Islands)
Oak Hill Investment Committees	the members of the Investment Committees of Oak Hill CP and Oak Hill SOF who approved the investment by Oak Hill CP and Oak Hill SOF in TeleCity Group
Oak Hill Investors	Oak Hill CP, Oak Hill CP II, Oak Hill CP-Management, Oak Hill SOF, Oak Hill SOF II and Oak Hill SOF III
Oak Hill SOF	OHSOF (Offshore I), L.P. (an exempted limited partnership organised under the laws of the Cayman Islands
Oak Hill SOF II	OHSOF (Offshore II), L.P. (an exempted limited partnership organised under the laws of the Cayman Islands)
Oak Hill SOF III	OHSOF (Offshore III), L.P. (an exempted limited partnership organised under the laws of the Cayman Islands)
Offer	the recommended offer to be made on behalf of TeleCity Group for the Redbus Shares on the terms and subject to the conditions described in this announcement and to be set out in the Offer Document and the Form of Acceptance (including, where the context so requires, any subsequent revision, variation, renewal or extension thereof)
Offer Document	the formal offer document to be sent to Redbus Shareholders containing the Offer
Offer Period	the period commencing on the date of this announcement and ending on the latest of: (i) 1.00 p.m. on the first closing date of the Offer; (ii) the date and time when the Offer becomes or is declared unconditional as to acceptances; and (iii) the date and time when the Offer lapses
overseas person	any person who is not resident in the United Kingdom, or who is a citizen, resident or national of a jurisdiction outside the United Kingdom, or who is a nominee of, or custodian or trustee for, any citizen(s), resident(s) or national(s) of any country other than the UK
Panel	the Panel on Takeovers and Mergers
Pogan	Pogan Invest Corp (a company incorporated in the British Virgin Islands)
Prospectus Rules	the Prospectus Rules of the Financial Services Authority
Publicly Announced	disclosed in the annual report and accounts of Redbus for the year ended on 31 December 2004 or in the interim statement of unaudited results of Redbus in respect of the period ended on 30 June 2005 which was published on 10 August 2005 or in this announcement or in any other announcement made by or on behalf of Redbus to the Regulatory News Service of London Stock Exchange plc since 30 June 2005 and prior to the date of this announcement
Relevant Authorisation	an authorisation, order, grant, recognition, confirmation, determination, consent, licence, clearance, permission, allowance or approval
Relevant Authority	any government, government department or governmental, quasi-governmental, supranational, statutory, regulatory or investigative body or authority, any trade agency, or any court, tribunal or any association, institution or other person or body whatsoever in any jurisdiction
Relevant Instrument	any agreement, arrangement, licence, permit, lease or other instrument or obligation whatsoever to which any member of the Wider Redbus Group is a party or by or to which any such member or any of its assets is or may be bound, entitled or subject
Redbus	Redbus Interhouse plc (registered in England and Wales with number 153088)
Redbus Approved Scheme	the Redbus Interhouse plc Approved Schedule to the Unapproved Executive Share Option Scheme 2001
Redbus Board or Redbus Directors	the board of directors of Redbus
Redbus Group	Redbus and its subsidiary undertakings
Redbus Share Option Schemes	the Redbus Approved Scheme, the Redbus Stock Option Plan and the Redbus Unapproved Scheme
Redbus Shares	the existing issued and fully paid ordinary shares of 1p each in the capital of Redbus (excluding any such shares held by TeleCity Group or any of its subsidiaries on the date upon which the Offer is made) and any further such shares which are unconditionally allotted or issued (including pursuant to the exercise of options granted under the Redbus Share Option Schemes) after the date of this announcement and before the Offer closes (or before such other time as TeleCity Group may decide in accordance with the terms and conditions of the Offer)
Redbus Stock Option Plan	the 1990 Stock Option Plan of Redbus
Redbus Unapproved Scheme	the Redbus Interhouse plc Unapproved Executive Share Option Scheme 2000
Saberasu Term Loan Agreement	the facility agreement dated 31 October 2005 made between (1) TeleCity Group and (2) Saberasu Japan Investments II B.V.
Share Alternative	the alternative under which Redbus Shareholders who validly accept the Offer may elect to receive a combination of New TeleCity Group Shares and cash in lieu of all (but not part only) of the cash to which they would otherwise be entitled under the Offer
Sputnik	Sputnik Group Limited (a company incorporated in the Bahamas)
subsidiary and subsidiary undertaking	to be construed in accordance with the Companies Act
substantial interest	in relation to an undertaking, an interest, direct or indirect, in 20 per cent. or more of the voting rights exercisable in relation to such undertaking or in the capital or any class of the capital of such undertaking
Teather ∓ Greenwood	Teather ∓ Greenwood Limited
TeleCity	TeleCity plc (registered in England and Wales with number 3819054)
TeleCity Group	TeleCity Group plc (registered in England and Wales with number 5603875)
TeleCity Group Directors	the directors of TeleCity Group, being Ian Nolan and Robert L Morse
Torch Partners	Torch Partners Corporate Finance Limited
UK2	UK2 Group Limited (a company incorporated in Gibraltar)
undertaking	to be construed in accordance with the Companies Act
USA	the United States of America, its possessions and territories, all areas subject to its jurisdiction or any sub-division thereof, any state of the United States and the District of Columbia
Wider TeleCity Group	TeleCity Group and its subsidiary undertakings, associated undertakings and any other undertakings in which TeleCity Group and such undertakings (aggregating their interests) have a substantial interest
Wider Redbus Group	Redbus and its subsidiary undertakings, associated undertakings and any other undertakings in which Redbus and such undertakings (aggregating their interests) have a substantial interest