VT Acquires Merlin Communications

December 11, 2001

Vosper Thornycroft (VT) announces that it has agreed to acquire Merlin for approximately $136 million USD ($94 million GBP). Merlin’s principal business is the facilities management of communications operations, primarily for the BBC in relation to the BBC World Service and for the Ministry of Defense (MOD). It also operates a global short wave and medium wave transmission network. Merlin will complement and extend VT’s existing skills and experience in the provision of technical services and is and important step towards VT’s target to more than double turnover from its support services business over the next 3 financial years. For the year ended March 31, 2001, Merlin reported operating profit, excluding a business to be discontinued, of $7.2 million on turnover of $74.6 million. Merlin is being acquired with sufficient cash balances to fund the expected closure or disposal costs of the business to be discontinued Merlin has recently signed a number of new contracts including the 280 m Submarine Fleet communications Service PFI and the $34 million contract to replace the BBC World Service transmitter relay station in Oman. The consideration of approximately $95 million is being satisfied by a combination of cash, loan notes and the issue of up to $1.38 million new ordinary shares in VT. Acquisitions are expected to be completed by November 30, 2001. Application will be made to the UK listing Authority for up to $1.38 million new ordinary shares in VT to be admitted to the Official list and application will be made to the London Stock Exchange.

VT Acquires Merlin Communications

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