BC95 Citi Fun 24

RNS Number:6807C
Abbot Group PLC
18 October 2002

                                                                 18 October 2002


     Disposal of 50 per cent. interest in Powergen Renewables joint venture
                              for #57.5 million in cash


Abbot Group plc ("Abbot"), the international energy services provider, announces
that it has agreed to dispose of its 50 per cent. interest in Powergen
Renewables Holdings Limited ("Powergen Renewables") to Powergen UK Plc ("
Powergen") for a total consideration of #57.5 million, including the repayment
of debt, payable in cash on completion.  The proceeds will be used to repay
borrowings.

Powergen Renewables is one of the largest developers and operators of wind
generated electricity farms in the United Kingdom and Ireland, both onshore and
offshore.

The consideration of #57.5 million represents a profit on the disposal of #46. 1
million, taking into account the costs of the transaction. The current book
value of Abbot's total investment in Powergen Renewables is #10.5 million,
including debt of #5.3 million.  The transaction is immediately earnings
enhancing.

Following the disposal, and based on its debt position at the time of its
interim results at 30 June 2002, Abbot's total borrowings would be reduced to
#38.2 million, representing pro forma gearing of 26 per cent..

Completion of the acquisition is expected to take place on 18 October 2002.

Abbot was advised by Cazenove & Co. Ltd and PricewaterhouseCoopers in connection
with the disposal.

Rationale for the Disposal

During the past few years, Abbot has developed from a North Sea drilling
contractor to become an international energy services provider, as a result of
both successful overseas marketing and through acquisitions.  This development
culminated in the acquisition of Deutag in 2001, creating a major European-based
company in the international onshore and offshore oil drilling contracting
industry.

Abbot's investment in Powergen Renewables is governed by a joint venture
agreement with Powergen.  Under the terms thereof, E.ON's acquisition of
Powergen in July 2002 enabled Abbot to review its investment in Powergen
Renewables. The board of directors of Abbot concluded that shareholder value was
best served by exiting the business at this time.

Whilst the board of directors of Abbot believe that this investment would have
continued to provide it with profitable growth, it would nevertheless have
resulted in an increasing level of capital expenditure in the years ahead.  The
board therefore concluded that shareholder interest was best served by focussing
on the profitable expansion of its core international drilling business.

Information on Powergen Renewables

Powergen Renewables has operated as a joint venture between Abbot and Powergen
since Abbot acquired a 50 per cent. interest in the business at the end of 1998.

As of 30 June 2002, Powergen Renewables' total generating capacity amounted to
approximately 130MW.  In addition, the company had recently received all
approvals from the Government and other agencies for the development of the 76MW
Scroby Sands wind farm offshore Great Yarmouth.

At 30 June 2002, the date of Abbot's interim accounts, Abbot's share of the net
assets of Powergen Renewables amounted to #5.7 million.  In the six months to
that date, the joint venture contributed no pre-tax profits to Abbot (#0.1
million in the year ended 31 December 2001).

Commenting on the disposal, Alasdair Locke, Executive Chairman, said "This
transaction represents an excellent return on Abbot's investment in the
renewable energy business, as well as providing us with substantial additional
resources. We believe that we will continue to achieve excellent returns for our
shareholders by concentrating our resources into our international drilling
operations as our acquisition of Deutag has already successfully demonstrated.
We are, therefore, committed to making appropriate investments to achieve
further profitable expansion, while at the same time disposing of non-core
assets.  Current trading remains in line with expectations and we are confident
of achieving a satisfactory outcome in the current year."


For further information:

Alasdair Locke                  Malcolm Moir                    Peter Willetts
Executive Chairman              Managing Director               Justin Griffiths
Abbot Group plc                 Cazenove & Co. Ltd              Tavistock Communications Limited
Tel: 020 7600 2288              Tel: 020 7588 2828              Tel: 020 7600 2288



                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

DISFFLFEASESEIS

Citi Fun 24 (LSE:BC95)
Gráfica de Acción Histórica
De Jun 2024 a Jul 2024

Citi Fun 24 (LSE:BC95)
Gráfica de Acción Histórica
De Jul 2023 a Jul 2024