KURA Kurawood

    KURAWOOD PLC                                  

                              UPDATE RE: FUNDING                               

Further to the announcement of 13 August 2008, the Board of Kurawood plc (the
"Company") announces that Fox Capital Limited ("Fox"), a company controlled by
two directors of the Company, Roy Tilleard and Justin Martin, has today made an
unsecured loan facility available to the Company of �100,000 (the "Loan"). The
Loan carries an interest rate of 6% above the Bank of England Base Rate, and is
available to be drawn down as required by the Company. Upon fulfilment of the
following conditions, the Loan is convertible into ordinary shares in the
Company at a price of 12p per share:

  * shareholder approval being given for a waiver of rule 9 of the Takeover
    Code, insofar as the Loan to be made by Fox increases their holding, and
    voting rights in the Company beyond 30% on conversion. Fox currently have
    an interest in 28.16% of the Company's issued share capital; and
   
  * raising of a minimum of a further �400,000 for the Company; Fox has agreed
    to subscribe for this further amount at a price of 12p per share.
    Shareholder approval will also be sought for such subscription for the
    purposes of rule 9 of the Takeover Code.
   
The Company is in advanced discussions with Fox. Subject to the approval of
shareholders, it is proposed that Fox will also be granted a warrant to
subscribe for such number of new ordinary shares at 12p per share as would give
it an interest of 51 per cent. of the Company's enlarged issued ordinary share
capital. The warrant would be able to be exercised in part or in full, and at
any time between the grant of shareholder approval for the waiver, and the
second anniversary of such approval being granted. It is envisaged that
shareholder approval will be sought, by way of a circular to shareholders
convening a General Meeting, as soon as practicable.

Under AIM Rule 13, the Loan and other arrangements set out above constitute a
Related Party Transaction as Fox is a related party as defined in the AIM Rules
for Companies because two of its controllers, Roy Tilleard and Justin Martin,
are directors of the Company. The remaining directors of the Company, Peter
McArthur and Peter Hammonds, who are deemed to be independent directors for
these purposes, consider, having consulted with Dowgate Capital Advisers
Limited, the Company's nominated adviser, that the terms of the Loan and other
arrangements are fair and reasonable insofar as the Company's shareholders are
concerned.

The Company has cash remaining of approximately �130,000, and the directors are
confident that this, and the additional �500,000 to be raised pursuant to these
proposals, will secure the Company financially for the next 12 months, allow
the Company to pursue its business plan and deliver on its strategy.

Since 13 August 2008, the Company has discharged its liabilities to Barclays by
repaying the �2 million term loan in full and intends to put a specialist trade
facility in place as and when the Company's trading levels develop
sufficiently.

Enquiries:

Justin Martin, Kurawood plc Tel: 01624 820 040

James Caithie, Dowgate Capital Advisers Limited Tel: 020 7492 4777

Ruari McGirr/Mark Anwyl, St Helen's Capital plc Tel: 020 7628 5582



END

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