Hi-Media Group Acquires Fotolog

Aug 31, 2007

Hi-Media Group, a website publishing and services company specializing in online advertising and electronic commerce, has entered into an agreement to acquire Fotolog, Inc., a photo-blogging community, for a combination of cash and stock valued at approximately $90 million, net of transaction expenses. Consideration anticipated to be paid to Fotolog shareholders would consist of Hi-Media stock (approximately 77% of total consideration) and cash (approximately 23% of total consideration), giving eligible Fotolog shareholders 7,414,852 newly-issued shares of Hi-Media (anticipated to represent approximately 19% of Hi-Media's issued and outstanding share capital upon completion of the acquisition).

(www.fotolog.com, www.hi-media.com)