SAR - Alvis PLC

BAE SYSTEMS PLC
22 August 2003

                                                        FORM SAR 3


                                       Date of disclosure     22 AUGUST 2003

                 DISCLOSURE UNDER RULE 3 OF THE RULES GOVERNING
                   SUBSTANTIAL ACQUISITIONS OF SHARES ('SARs')

                 
Date of acquisition     22 AUGUST 2003

Acquisition in          ALVIS PLC          (name of company)


(1) Class of voting shares    Number of shares/rights   If rights over shares
    (eg ordinary shares)      over shares acquired      acquired, as opposed
                                                        to the shares
                                                        themselves, specify
                                                        nature of rights

    ORDINARY SHARES OF 25P                     shares   AGREEMENT TO ACQUIRE 
                              31,882,534       rights   SHARES FROM GKN (UNITED
                                                        KINGDOM) PLC

(2) Resultant total holding   Resultant total holding   Total percentage
    of voting shares (and %   of rights over shares
    of total voting shares    (and % of total voting
    in issue)                 shares in issue)

                    (     %)  31,882,534       (28.95%)            (28.95%)


(3) Party making disclosure      BAE SYSTEMS PLC

(4)  (a)  Name of person acquiring shares or rights over shares 
          BAE SYSTEMS PLC

          and, if different, beneficial owner

     (b)  Names of any other persons acting by
          agreement or understanding (see SAR 5)    N/A


Signed, for and on behalf of the party named in (3) above

(Also print name of signatory)     ANN-LOUISE HOLDING

Telephone and extension number     01252 383185

Note. Under SAR 5, the holdings of and acquisitions by persons acting by
agreement or understanding must be aggregated and treated as a holding of or
acquisition by one person.  Note 3 on SAR 5 requires persons who must aggregate
holdings to disclose certain disposals.

For full details of the SARs disclosure requirements, see Rules 3 and 5 of the
SARs.  If in doubt, contact the Panel on Takeovers and Mergers, Monitoring 
Section, Tel. No: 020 7638 0129.


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