LIVONIA, Mich., March 15 -- Valassis, the leading company in marketing services and Connective Media(TM), in response to numerous shareholder inquiries about the Federal Trade Commission ("FTC") investigation, wishes to provide further information to its shareholders. On November 9, 2004, Valassis received a letter from the FTC advising Valassis that the FTC is conducting a non-public investigation to determine whether Valassis may have engaged in unfair acts or competition in violation of Section 5 of the Federal Trade Commission Act by soliciting an agreement with a competitor to fix prices and allocate customers. The documents and information requested by the FTC staff to date indicate that the FTC is primarily interested in the announcement of an FSI price improvement initiative in the July 22, 2004 quarterly earnings press release and public conference call. In the letter, the FTC pointed out that neither the letter itself or the existence of this non-public investigation should be construed as indicating that a violation has occurred or is occurring. Since the investigation began, Valassis has been fully cooperating and is providing requested documents and information. Generally an FTC investigation begins with gathering information. Should the FTC staff conclude that further steps are required, the matter may be referred to the FTC Commissioners for formal action. The investigation concerning Valassis remains in a preliminary, non-public phase, although Valassis has chosen to disclose its existence. Questions of what kind of speech may be considered "soliciting" and subject to Section 5 have not been clearly answered either by judicial decisions or FTC rule-making that would give guidance as to what is and what is not permissible. In this instance, the conduct being investigated appears to be the announcement and discussion of the July 2004 FSI price initiative. Valassis investors and potential investors have in recent years demonstrated a high level of interest in FSI price levels and market share. We believe that the announcement was appropriate because it served a legitimate business function, discharged a federal securities law disclosure obligation and was not motivated by anti-competitive intent. The primary relief generally sought by the FTC in these types of cases is equitable in nature in the form of a decree delineating acceptable future conduct. Although we cannot predict the timing or outcome of this investigation, one consequence of an adverse result might be that future public speech regarding changes to Valassis' FSI pricing policies might be subject to restriction. We do not expect any relief to otherwise restrict the operation of our FSI business.