Microgen reports on Trace takeover bid

The Increased Offer Document was posted to Trace Shareholders on 20 June 2007.

Level of acceptances

Microgen announces that, as at 1.00 p.m. (London time) on 20 July 2007, the third closing date of the Increased Cash Offer, valid acceptances of the Increased Cash Offer had been received in respect of 2,566,219 Trace Shares, representing approximately 18.01 per cent. of the Trace Shares.

The valid acceptances include 1,127,880 Trace Shares, representing approximately 7.92 per cent. of the Trace Shares, received pursuant to an irrevocable commitment from Herald Investment Management limited and 10,000 Trace Shares, representing approximately 0.07 per cent. of the Trace Shares, received pursuant to an undertaking from Daniel Chapchal, Chairman of Trace, to procure acceptance of the Increased Cash Offer of the Trace Shares held in his SIPP.

Microgen has acquired 3,680,000 Trace Shares in aggregate, representing approximately 25.83 per cent. of the Trace Shares. Therefore, as at 1.00 p.m. (London time) on 20 July 2007, Microgen owned or had received valid acceptances in respect of a total of 6,246,219 Trace Shares, representing approximately 43.84 per cent. of the Trace shares which it is entitled to count towards the satisfaction of the acceptance condition under the Increased Cash Offer.

In addition, Microgen has also received an undertaking to accept the Increased Cash Offer from Colin Clarke, a Trace Independent Director, in respect of the 1,426,453 Trace Shares (representing 10.01 per cent. of the Trace Shares) owned by him and his connected parties upon the lapsing of his existing irrevocable commitment to the Tulip Revised Offer. Such lapsing will occur in the event that the Tulip Revised Offer lapses or is withdrawn.

Save as disclosed above, neither Microgen nor any person acting in concert with it for the purpose of the Increased Cash Offer has an interest in (or a right to subscribe for or any short positions (whether conditional or absolute and whether in the money or otherwise), including any short positions under a derivative, any agreement to sell or any delivery obligation or right to require another person to purchase or take delivery in respect of) or has borrowed or lent any Trace Shares during the Offer Period.

Trace Shareholders who wish to accept the Offer and who have not already done so should:

1. in respect of Trace Shares held in certificated form, complete and return the BLUE New Form of Acceptance in accordance with the instructions set out in the Increased Offer Document and on the BLUE New Form of Acceptance, so as to be received as soon as possible and, in any event, by no later than 1.00 p.m. (London time) on 27 July 2007; or
2. in respect of Trace Shares held in uncertificated form (that is, through CREST), Trace Shareholders should submit a TTE instruction in accordance with the instructions in the Increased Offer Document for settlement as soon as possible and, in any event, by no later than 1.00 p.m. (London time) on 27 July 2007.

This announcement should be read in conjunction with the Increased Offer Document dated 20 June 2007 and the expressions used in this announcement (unless the context otherwise requires) have the same meaning as in the Increased Offer Document. The Increased Offer Document is available for inspection on Microgen's website and copies of the Increased Offer Document and the New Form of Acceptance (for use by holders of Trace Shares in certificated form only) are available for inspection during normal business hours on any weekday (Saturdays, Sundays and public holidays excepted) at the registered office of Clyde & Co LLP at 51 Eastcheap, London EC3M 1JP until the end of the Offer Period.

Capitalised terms used, but not defined in this announcement have the same meaning as given to them in the Increased Offer Document.