Statement re Serious Fraud Office

SERIOUS FRAUD OFFICE

Severn Trent Plc announces today that Severn Trent Water Ltd has decided to
plead guilty to two offences relating to leakage data supplied to Ofwat in 2001
and 2002.

The pleas will be entered later today at the City of London Magistrates' Court.
A third charge relating to leakage data supplied to Ofwat in 2000 will not be
pursued by the Serious Fraud Office.

Tony Wray, Chief Executive of Severn Trent Plc, said:

"The Severn Trent Board has co-operated fully with the SFO at all times during
this investigation. We have now studied carefully the details of the charges
which relate to the responsibilities of a previous regime.

"Having taken legal advice, we have decided that the best course of action is
for the Company to plead guilty at the earliest opportunity to two of the three
charges which were originally made by the SFO.  The third charge will not be
pursued.

"The SFO will set out the facts of the case at a later hearing in Crown Court
prior to sentencing. Until that stage has been reached we will not be making
any further comment on the detail behind the charges.

"What I can say at this time is that we deeply regret the mistakes of the
previous regime. Severn Trent's new Board and management team has taken, and
will continue to take, all actions appropriate to ensure the maintenance of
both high ethical and professional standards and resilient and effective
controls throughout our organisation.

"A comprehensive root and branch reorganisation of Severn Trent Water has been
completed since I became Managing Director in March 2005 and, now, as Chief
Executive of Severn Trent, I and my new management team are determined to
continue to drive improvements in all our activities for the benefit of all our
customers and other stakeholders."

Severn Trent Water Ltd is to plead guilty to two offences contrary to section
207 of the Water Industry act 1991, as follows:

(A) That in furnishing the June Return 2001, STW made a statement which it knew
to be false in a material particular, or recklessly made a statement which was
false in a material particular, in that the June Return for 2001 falsely stated
that the Company's Estimate of leakage for that year was 340.24 mega-litres per
day when:

(1) this was not the figure produced by the use of the Company's Domestic
Consumption Monitor;

(2) and it was not the best estimate available to the Company using the
estimation methods required

(B) In furnishing the June Return 2002, STW made a statement which it knew to
be false in a material particular, or recklessly made a statement which was
false in a material particular, in that the June Return for 2002 falsely stated
that the Company's Estimate of leakage for that year was 340.28 mega-litres per
day when:

(1) this was not the figure produced by the use of the Company's Domestic
Consumption Monitor;

(2) the figure was calculated using a false distribution input level which had
been adjusted without justification; and

(3) it was not the best estimate available to the Company using the estimation
methods required.

On 31 October 2005 the SFO informed Severn Trent that, as a result of a
referral by Ofwat, it was undertaking a criminal investigation into alleged
reporting irregularities concerning leakage data supplied to Ofwat by Severn
Trent Water between 2000 and 2003.

For further information contact:

Peter Gavan, Director of External Affairs
Severn Trent
0121 722 4310

Andrew Marsh, Media Relations, Severn Trent
0121 722 4555

Gill Dickinson, Media Relations, Severn Trent
0121 722 4380

A conference call will be chaired by Tony Wray, Chief Executive of Severn
Trent, at 0830 am on Tuesday 8 April 2008. Call details are as follows:

Telephone number: [phone]

PIN code: 769508#

This call will be recorded and available immediately after the live call has
concluded. It can be accessed for playback for 30 days as follows:

Telephone number: [phone]

Conference reference: 212191#

It will also be available on the Severn Trent website (www.severntrent.com)