Acquisition

Balfour Beatty PLC
30 August 2007


30 August 2007


                     BALFOUR BEATTY ACQUIRES COWLIN GROUP,
               A LEADING UK REGIONAL CONTRACTOR, FOR £52 MILLION

                    Further step in established strategy of
             expanding Balfour Beatty's regional presence in the UK
             ======================================================


                               K E Y   P O I N T S

-  Provides strong, profitable presence in building construction markets in 
   South and Southwest England and in Wales
-  Excellent fit in terms of geography, culture and project type
-  Strong, well-respected brand with a quality reputation and a large secured 
   order book
-  Core activities in long-term partnerships and frameworks with high levels of
   repeat business
-  Experienced management with a strong track record of successful growth
-  Mature, established supply chain structure and proven risk management
-  Earnings enhancing in 2008 and beyond*

* The statement as to earnings per share enhancement does not constitute a
profit forecast and should not be interpreted to mean that Balfour Beatty's
future earnings per share will necessarily exceed or match those of any prior
year.

Commenting on the acquisition, Balfour Beatty Chief Executive, Ian Tyler said:

'The acquisition of Cowlin Group adds to our leading position in regional UK
building markets by establishing a strong base in an area where we currently
have only a limited presence. It is well-established in its regional design and
build, construction and refurbishment markets and has a strong management team
which has made excellent progress in growing the business over recent years.'



                      BALFOUR BEATTY ACQUIRES COWLIN GROUP,
                A LEADING UK REGIONAL CONTRACTOR, FOR £52 MILLION

                    Further step in established strategy of
             expanding Balfour Beatty's regional presence in the UK
             ======================================================

Balfour Beatty, the international engineering, construction, services and
investment group, announces today that is has acquired Cowlin Group, the leading
UK regional building business, for a cash consideration of approximately
£52 million from its current management. Cowlin Group has positive net cash
balances in excess of £20 million.

Rationale and Key Benefits
--------------------------

The acquisition is in line with Balfour Beatty's strategy to extend its UK
regional building and civil engineering businesses. The operations which make up
Balfour Beatty's leading presence in these markets deliver amongst the Group's
best and most reliable margins, and the markets themselves have positive growth
momentum. Cowlin will provide a strong, established presence in the south and
southwest of England and in Wales, markets where the Group currently has little
coverage.

The acquisition is expected to be earnings enhancing in 2008 and beyond*.

Cowlin Construction
-------------------

Cowlin Group, which trades as Cowlin Construction, is a building and
refurbishment contractor based in Bristol, serving South and Southwest England
and Wales. It operates through four main regional offices in Bristol, Cardiff,
Plymouth and Yeovil and has wide sector coverage with particular expertise in
education, healthcare, leisure, residential, commercial and industrial property.
Much of its business is done through long-term frameworks and partnership
arrangements.

The business was established in 1834. It has approximately 300 staff and 150
directly employed operatives. In healthcare, it constructs general hospitals,
special care units and research and teaching facilities. In education, it has an
extensive portfolio of work for local education authorities and universities. In
commercial and industrial property, it is active in office developments,
business parks, industrial units and headquarters buildings. It has over 50
years' experience in the luxury residential market.

It also has a specialist timber frame division based in Wales.

Performance
-----------

In the year ended 30 September 2006, Cowlin had revenues of £186 million and
profit before tax of £5.3 million. Net assets at 30 September 2006 were £5.8
million, while its confirmed order book exceeds £200 million with a further £130
million of prospective work under final negotiation.

The Market
----------

UK construction and building markets are growing significantly, underpinned by
government spending on infrastructure and by buoyant private sector investment.
With its strong relationships with both public and private sector customers,
Cowlin is well positioned to take advantage of this growth, as are Balfour
Beatty's other regional construction and infrastructure businesses.

* The statement as to earnings per share enhancement does not constitute a
profit forecast and should not be interpreted to mean that Balfour Beatty's
future earnings per share will necessarily exceed or match those of any prior
year.

                                      ENDS

Enquiries to: Tim Sharp
Tel: [phone]
www.balfourbeatty.com


Notes to Editors
----------------

1.  Balfour Beatty is the UK's leading building construction company. It
    currently operates through:

    -  Balfour Beatty Construction - the £750 million per annum revenue major 
       projects building business active in education, healthcare, defence and 
       industrial and commercial property markets. Amongst its current major 
       projects are the £530 million Birmingham Hospital, the £180 million 
       Stobhill and Victoria Hospitals in Glasgow and major PPP schools schemes 
       in Birmingham, Stoke, Bassetlaw, Rotherham and North Lanarkshire.

    -  Mansell - the £750 million per annum revenue regional building company 
       with a wide range of long-term framework partners and specialist 
       expertise in new build and refurbishment. It is a leader in the 
       fast-growing affordable housing market.

2.  Balfour Beatty strengthened its regional businesses by the acquisition of
    Mansell for the building business in 2003 and Birse for the civil 
    engineering business in 2006, both of which have been successfully 
    integrated into the Balfour Beatty organisation.

3.  Balfour Beatty is the UK leader in building services through Haden Young, 
    the mechanical and electrical contractor, and Balfour Kilpatrick, the 
    electrical services company. These two businesses have combined annual 
    revenues of approximately £500 million.

4.  Balfour Beatty is a leading player in the UK facilities management market
    through Haden Building Management which has annual revenues of approximately
    £300 million.

5.  Balfour Beatty is a world-class engineering, construction, services and
    investment business, well positioned in infrastructure markets which offer
    significant long-term growth. We work in partnership with sophisticated
    customers who value the highest levels of quality, safety and technical
    expertise. Our skills are applied in appropriate combinations to meet 
    individual customer need. Its financial position, with significant net cash 
    and with strong operating cash flows, offers continuing flexibility to add 
    additional capacity and expertise to the business mix and to make 
    appropriate investments in PPP and other long-term growth opportunities.




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