Micap plc announces positive results of a recent study on use of Micap encapsulated fungicides to improve control of fungal damage to cereal crops - 20 th October 2004

Micap plc (“Micap”, LSE: MIC) today announces new business opportunities in the area of agrochemicals.

Further to the recently-reported success in the evaluation of Micap technology for herbicides, promising new results have now been obtained in fungicide applications. Micap has funded laboratory trials at the University of Nottingham comparing the performance of a commercial fungicide formulation with a formulation based on Micap technology. The target for the study was the ear blight fungus Fusarium, which represents a significant commercial threat to cereal farmers.

The outcome of the study showed that a standard Micap formulation performed well compared to a commercial product for stem based disease control. Additionally, in mature plants, when wheat ears were infected, the Micap formulation of the fungicide tebuconazole outperformed the commercial product, resulting in an increased grain yield.

In addition, subsequent studies have demonstrated a substantial reduction in the levels of Fusarium mycotoxin present in the grain of Micap-treated plants. This is a likely reflection of the benefit of sustained release of the active ingredient. The use of the Micap encapsulation technology for the delivery of fungicides offers the potential to control mycotoxin contamination of grain to below 0.75ppm, the target level currently under review by the European Union.

Michael Brennand, Chief Executive of Micap, said: “We are delighted at these encouraging study results and look forward to the continued development of fungicidal applications.”

Dr. Steve Rossall, senior lecturer in plant pathology at Nottingham University , commented: “The results produced by the Micap technology in the Fusarium study were very promising, particularly since the formulation of the Micap product had not been optimised.”

Discussions are currently underway with a major multinational to carry out field trials incorporating the Micap formulation of tebuconazole used in the study.

Ongoing studies include the evaluation of Micap formulations of a number of azole fungicides against their commercial equivalents, whilst trials of seed dressing applications are currently at the planning stage.

About Micap

Micap listed on AIM in August 2003 and is a UK technology licensing company specialising in the micro encapsulation of active ingredients within yeast cells.  For further details visit www.micap.co.uk

Microencapsulation is a process whereby tiny droplets of liquid or particles of solid material are coated with a continuous film of polymeric material.  Microcapsules have several benefits, including conversion of liquids to solids; separating reactive compounds; protecting substances against environmental factors; and improving the material handling properties.  Micap's unique proprietary technology involves using killed yeast cells as natural capsules to protect the active ingredient.  Yeast encapsulation can protect active ingredients against high temperatures, the effects of the sun, pressure and degradation through exposure to the air.  The natural affinity of yeast cells for mucous membranes can also be exploited for targeted drug delivery.

About Fusarium blight

The global market for agrochemicals is around $30bn and is split into three main sectors: herbicides, fungicides & insecticides.

Fusarium is a stem-based pathogen of cereals which primarily affects the ears, causing reduced yield and importantly a contamination of the grain with mycotoxins, which are potentially harmful to people. Fusarium Ear Blight infection was estimated to cause a loss in excess of $2.5bn to farmers in the US between 1998-2000 (Ngenje et al, Oct 2001).

Mycotoxins

Mycotoxins are toxic chemicals produced by moulds growing on food commodities or animal feedstuffs. In order to protect public health, they are subject to government regulation in most countries.