Proposed Acquisition of P&O Trans European for GBP152.5 million

RNS Number:8173E
Wincanton PLC
09 December 2002

Proposed Acquisition of P&O Trans European for GBP152.5 million

“An ideal opportunity to continue the successful expansion of Wincanton”

Wincanton Plc (“Wincanton”), a leading provider of complex supply chain
solutions, is pleased to announce the proposed acquisition of P&O Trans European
(“Trans European”) on a debt free basis for GBP152.5 million in cash. This
acquisition increases the scale, range and geographic scope of Wincanton’s
service offering to customers, confirming its position as the second largest
logistics company in the UK and opening up new markets in Continental Europe.

Key Points

Trans European

– An established pan-European contract logistics provider with
extensive coverage in the UK and Western Europe and growing presence in Eastern
Europe.

– A broadly-based business serving blue chip customers in the
petrochemical, automotive, and other industrial sectors. Growing presence in
consumer goods and retail.

– Full range of integrated logistics solutions on a dedicated and
shared user basis including cross border “4PL” supply chain services.

Reasons for Acquisition

– Confirms Wincanton’s position as one of the largest supply chain
solutions companies in the UK.

– Creates a pan-European platform in a single step.

– Enables Wincanton to meet demand from its existing blue-chip
customer base to provide services on a broader geographic base.

– Complementary fit of Wincanton’s retail and consumer customer base
with Trans European’s predominantly industrial customer base.

Management

– Creation of two operating boards, one for the UK and one for
Continental Europe. Paul Bateman and Gerard Connell will sit on both boards.

– Wincanton and Trans European in UK and Ireland to be integrated into
a single management structure under Graeme McFaull, currently Managing Director,
Consumer Logistics and an experienced member of Wincanton’s main board.

– Continental European businesses will report to Peter Brown,
currently Managing Director, Industrial Logistics and another
experienced member of Wincanton’s main board.

Financial Background

– Acquisition is expected to enhance Wincanton’s earnings, measured
before reorganisation costs and goodwill amortisation, in first full year of
ownership.

– Operational efficiencies of not less than GBP2 million p.a. within
18 months of acquisition.

– Acquisition is supported by a strong asset base with only a small
element of goodwill.

– In year ended 31 December 2001 Trans European reported operating
profit before goodwill amortisation and discontinued operations of GBP14.5
million (2000: GBP13.3 million) on sales before discontinued operations of
GBP690.9 million (2000: GBP596.9 million).

– Acquisition funded by new five year committed bank facilities of
GBP270 million.

Paul Bateman, Chief Executive of Wincanton, said:

“The earnings enhancing acquisition of Trans European is an ideal opportunity to
continue the successful expansion of Wincanton. Our strategy has long been to
expand our range of services and geographical coverage for our customers. Trans
European fits both these requirements.”

An analyst presentation will take place at the offices of Buchanan
Communications on Monday 9th December 2002, at 10.00 a.m., 107 Cheapside, London,
EC2

For further details please contact Buchanan Communications

For further enquiries please contact:

Wincanton
Paul Bateman, Chief Executive 020 7466 5000 (today)
Gerard Connell, Group Finance Director 01963 828282 (thereafter)
Charles Carr, Director of Marketing & Communications