RNS Number:5277T
Brammer PLC
22 December 2003


FOR IMMEDIATE RELEASE


Brammer plc


Proposed sale of the Livingston Calibration Business


Highlights:


-          The proposed Disposal of Brammer's continental European calibration
and equipment management services businesses (the "Livingston Calibration
Business") to Air Liquide for cash consideration of Euro32 million (#22.5 million)


-          Brammer is in discussions regarding the disposal of its equipment
rental and UK calibration businesses (the "Livingston Rental Business")


-          Brammer Industrial Services ("BIS") is the leading European supplier
of technical components and related services to the maintenance, repair and
operations markets


-          The net proceeds of the Disposal will be used to reduce the Brammer
Group's indebtedness and significantly strengthens the Brammer balance sheet,
positioning the group to accelerate progress in its strategic objectives


-          The Disposal is conditional, inter alia, upon the approval of
Brammer's shareholders, which is to be sought at an Extraordinary General
Meeting


Commenting on the Disposal, Ian Fraser, Chief Executive of Brammer, said:


 "This Disposal will allow Brammer to focus on developing BIS and capitalise on
its leading position in the European industrial services market for the benefit
of both customers and shareholders."



Enquiries:


Brammer plc                               0161 928 3363
David Dunn, Chairman
Ian Fraser, Chief Executive
Paul Thwaite, Finance Director

Dresdner Kleinwort Wasserstein            020 7623 8000
Chris Treneman, Managing Director

Citigate Dewe Rogerson                    020 7638 9571
Martin Jackson
Anthony Kennaway



Dresdner Kleinwort Wasserstein Limited, which is authorised and regulated by the
Financial Services Authority, is acting for Brammer plc and no-one else in
connection with the contents of this announcement and will not be responsible to
anyone other than Brammer plc for providing the protections afforded to
customers of Dresdner Kleinwort Wasserstein Limited, or for affording advice in
relation to the contents of this announcement or any matter referred to herein.
Dresdner Kleinwort Wasserstein Limited has given and has not withdrawn its
consent to the issue of this announcement with the inclusion of the references
to its name in the form and context in which it is included.



Brammer plc


Proposed disposal of the Livingston Calibration Business


Introduction


The Board of Brammer announces that it has reached agreement to sell its
continental European calibration and equipment management services businesses
(the "Livingston Calibration Business") to Air Liquide for a cash consideration
of Euro32 million (#22.5 million), calculated on a debt and cash-free basis, and
subject to adjustment to reflect the amount of cash and debt in the business at
completion.


In view of the size of the Disposal relative to the Group, the Disposal is
conditional upon, inter alia, the approval of Shareholders at an Extraordinary
General Meeting of the Company.


Information on the Livingston Calibration Business


The Livingston Calibration Business comprises of the European (excluding the UK)
calibration services businesses and the European equipment management services
business. The calibration business is located in France, Germany, Spain and The
Netherlands and provides calibration services for its customers' test and
measurement equipment. The equipment management services business provides
outsourced management for customers' test and measurement equipment. The
Livingston Calibration Business reported sales of #38.7 million and an operating
profit of #2.8 million for the year ended 31 December 2002, and as at 31
December 2002 had net assets of #1.8 million.


Principal terms and conditions of the Disposal


Under the Sale and Purchase Agreement, Brammer will sell (or procure the sale
of) the Livingston Calibration Business to Air Liquide for a cash consideration
of Euro32 million (#22.5 million) (calculated on a debt and cash-free basis, and
subject to adjustment to reflect the amount of cash and debt in the business at
completion of the Disposal). Completion of the Disposal is conditional, inter
alia, upon the approval by Shareholders of the Disposal at the EGM, and is
anticipated to take place by 31 March 2004.


Strategy and background to and reasons for the Disposal


Following the downturn in the technology and telecoms markets in mid-2001, the
Board undertook a re-evaluation of the Group's long-term strategy. This review
concluded that the Group should focus its resources on further developing
Brammer Industrial Services as the leading European supplier of technical
components and related services to the maintenance, repair and operations
markets. In addition, the Board concluded that, at an appropriate time, the
Group should seek to divest itself of the Livingston Division.


In forming this view, the Board recognised that, despite the difficult
conditions in recent years in the European industrial market that BIS serves,
BIS has continued to develop an important market position across Europe,
increasing its market share and developing extensive pan-European relationships
with both customers and suppliers. The Directors also believe that a focused BIS
business, separated from the capital demands of the Livingston Division, will be
better able to exploit the significant opportunities for further development,
including:


*         continued leverage of BIS' pan-European coverage to win market share,
particularly through corporate accounts and the development of Insites (sales
operations located within a customer's premises);

*         driving further purchasing economies from BIS' position as the largest
customer to the majority of its main suppliers;

*         enhanced consolidation opportunities given the strengthened balance
sheet of the Continuing Group. The European market for the distribution of
bearings, power transmission and related products remains highly fragmented with
most geographic markets still served by a large number of small distributors.
The Directors believe that BIS accounts for approximately four per cent. of the
market with the next biggest competitor representing less than two per cent. of
the market;

*         further operating efficiencies through increased investment in
logistics, infrastructure and back-office systems; and

*         continued cross-selling of a broader range of products to existing
customers.


Over the last two years the Board has undertaken a significant and extensive
rationalisation of the Livingston Division in order to return it to
profitability and reduce the Group's exposure to the technology and telecom
markets whilst awaiting an appropriate opportunity to sell all or part of the
Livingston Division. During this period, the Livingston Calibration Business has
performed more resiliently than the Livingston Rental Business and has
maintained its profitability at the trading profit (defined as operating profit
before exceptional items and goodwill) level. However, in order to reduce the
costs in the Livingston Calibration Business, the Group has incurred total
exceptional restructuring costs of #4.8 million in respect of the Livingston
Calibration Business in the 18 months ended 30 June 2003.


Having received a proposal from Air Liquide in line with the Group's strategy,
the Board concluded that it should pursue the Air Liquide proposal. Following
commencement of these discussions, the Board has also received an approach for
the remainder of the Livingston Division, comprising the Livingston Rental
Business, which the Board is also currently pursuing. These discussions are
ongoing, and accordingly there can be no certainty that satisfactory agreement
will be reached with the prospective purchaser of the Livingston Rental
Business.


Current trading and future prospects of the Continuing Group


Overall sales and trading remain broadly in line with the Board's expectations.


Despite the medium term growth opportunities open to BIS, its markets continue
to be difficult. In the Group's interim results for the six months ended 30 June
2003, announced on 2 September 2003, the Board reported that both sales and
operating profit before goodwill amortisation and exceptional items in BIS grew
by 12 per cent.. Trading in the second half has been slower with reported sales
likely to be slightly above the same period last year. However, corporate
account activity and Insite sales showed strong growth across the period. The
Directors are confident that BIS continues to win new business across its major
markets and remain confident in its prospects.


Trading in the Group's rental businesses has remained difficult, and rental
revenues over the last three months have been slightly below the levels of the
previous quarter. Asset disposals have been at satisfactory prices and
depreciation has been reduced. Further cost reductions have also been achieved.


The sale of the Livingston Calibration Business is likely to result in
exceptional profit, which if it had been completed on 30 June 2003 would have
been approximately #7.2 million. In light of the prevailing market conditions,
the Board envisages that it may be prudent to consider as part of its normal
year-end review, making further provisions in respect of the rental inventory
assets which may offset the exceptional pre-tax profit on the Disposal. The net
proceeds of the Disposal will be used to reduce the net debt position of the
Continuing Group.


Financial effects of the Disposal


The Board believes that the effect of the Disposal will be an exceptional
pre-tax profit, which, if the Disposal had been completed on 30 June 2003, would
have been of #7.2 million. Whilst the Group will no longer consolidate any
future profits generated by the Livingston Calibration Business after the
completion of the Disposal, its interest costs will be reduced as a result of
the receipt of the net proceeds of the Disposal.



Further information


A circular to Shareholders providing further information on the Disposal and
containing a notice of the Extraordinary General Meeting to approve the
Disposal, will be posted to Shareholders shortly.


Enquiries:


Brammer plc                              0161 928 3363
David Dunn, Chairman
Ian Fraser, Chief Executive
Paul Thwaite, Finance Director

Dresdner Kleinwort Wasserstein           020 7623 8000
Chris Treneman, Managing Director

Citigate Dewe Rogerson                   020 7638 9571
Martin Jackson
Anthony Kennaway


Dresdner Kleinwort Wasserstein, which is authorised and regulated by the
Financial Services Authority, is acting for Brammer plc and no-one else in
connection with the contents of this announcement and will not be responsible to
anyone other than Brammer plc for providing the protections afforded to
customers of Dresdner Kleinwort Wasserstein, or for affording advice in relation
to the contents of this announcement or any matter referred to herein. Dresdner
Kleinwort Wasserstein has given and has not withdrawn its consent to the issue
of this announcement with the inclusion of the references to its name in the
form and context in which it is included.


APPENDIX


The following principal definitions apply throughout this announcement unless
the context requires otherwise:


"Air Liquide"                           L'Air Liquide S.A.;

"BIS"                                   Brammer Industrial Services Division;

"Company" or "Brammer"                  Brammer plc;

"Continuing Group"                      Brammer and its subsidiary undertakings, excluding the Livingston
                                        Calibration Business;

"Directors" or "Board"                  the directors of the Company or a duly authorised committee
                                        thereof;

"Disposal"                              the disposal of the Livingston Calibration Business in accordance
                                        with the Sale and Purchase Agreement;

"Dresdner Kleinwort Wasserstein"        Dresdner Kleinwort Wasserstein Limited;

"Extraordinary General Meeting" or      the extraordinary general meeting of the Company, notice of which
"EGM"                                   will be sent to Shareholders shortly;

"Group" or "Brammer Group"              Brammer and its subsidiary and associated undertakings;

"Livingston Calibration Business"       Brammer's European (excluding the UK) calibration services
                                        businesses and the European test and measurement services
                                        business;

"Livingston Division"                   Brammer's Livingston division;

"Livingston Rental Business"            the whole of Brammer's equipment rental business and Brammer's UK
                                        calibration services businesses;

"Sale and Purchase Agreement"           the conditional agreement dated 19 December 2003 between (amongst
                                        others) the Company and Air Liquide relating to the Disposal;

"Shareholders"                          holders of Shares;

"Shares"                                ordinary shares of 20p each in the capital of the Company;

"United Kingdom" or "UK"                the United Kingdom of Great Britain and Northern Ireland.



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