Acquisition

Balfour Beatty PLC
10 August 2005


10 August 2005


 BALFOUR BEATTY ACQUIRES PENNINE GROUP, THE UK GROUND ENGINEERING SPECIALISTS,
            AND AGREES TO ACQUIRE SBB, THE GERMAN SIGNALLING COMPANY
            =========================================================
                                        
                Acquisitions strengthen Balfour Beatty's position
                    in ground engineering and rail signalling
                    -----------------------------------------

Balfour Beatty, the international engineering, construction and services group,
announces today that it has acquired Pennine Group, the UK ground engineering
business, for approximately £8 million and agreed to acquire SBB, the specialist
German signalling contractor, for €14 million.

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

'Balfour Beatty is, through Stent, already a leader in the piling sector and the
acquisition of Pennine gives us a strong, complementary presence in ground
engineering. We can now offer the full range of foundation solutions in the UK.
The acquisition of SBB will offer us an important opportunity to broaden our
signalling capability and to develop further our excellent existing relationship
with Deutsche Bahn in Germany.'

Pennine operates throughout the UK and specialises in the treatment and
preparation of poor ground by the use of specialist vibration techniques - using
proprietary equipment which it also manufactures. It also operates selectively
overseas, including in Spain.

SBB is a leader in the German market for electrical signalling installations. It
will become a part of Balfour Beatty Rail Power Systems, Balfour Beatty's
Munich-based subsidiary which specialises in rail electrification and power
systems for international rail markets.

Pennine
-------

In the UK, growth prospects for ground improvement are attractive, driven by the
trend to develop brownfield sites and increasing requirements for environmental
remediation. Pennine has a good reputation for delivering cost-effective,
value-added, reliable solutions to a wide range of construction customers. There
is also significant potential to expand further Pennine's operations overseas,
including in the Middle East where ground conditions favour the technology used
by Pennine.

In the financial year ending March 2005, Pennine had sales of £16 million and
operating profit of approximately £1.5 million.

The Group employs 130 staff and is based at Bacup in Lancashire.

SBB
---

SBB currently operates, predominantly, in the former East Germany, but has
recently extended its operations to the west. The majority of its work is in the
renewal and installation of signalling systems under existing framework
contracts with Deutsche Bahn. SBB is a profitable company with a skilled
signalling workforce and fits well with our recent acquisition of Bombardier's
UK-based Solid State Interlocking business.

In 2004, SSB had sales of approximately €10 million. The company has 85
employees and is based in Stassfurt near Leipzig.

The acquisition is subject to clearance from the German Cartel Office, which is
expected in late August.

                                      ENDS

Enquiries to:

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


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

1.  Balfour Beatty is a world-class engineering, construction and services 
    group, well positioned in infrastructure markets which offer significant
    growth potential. Its partnerships with public and private customers
    generate secure, sustainable income. 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.

2.  Stent Foundations designs and constructs foundations for all types of
    building, structures and civil engineering works. Amongst its recent major
    foundation contracts are:

      -  the new Wembley National Stadium
      -  the City of Manchester Stadium
      -  Channel Tunnel Rail Link Contracts 440 and 420
      -  M25 widening at Heathrow Airport
      -  the new Arsenal Stadium at Ashburton Grove
      -  University College London Hospital.

3.  In October 2004, Balfour Beatty acquired Bombardier Transportation's UK
    Solid State Interlocking (SSI) signalling resources. This acquisition, in
    conjunction with Balfour Beatty's existing signalling expertise, created a
    broad range of signalling related services to service the needs of Network
    Rail and other customers.

4.  Balfour Beatty Rail Power Systems is a major supplier to rail network owners
    and operators in Germany, Italy, Sweden, Austria, Spain, Portugal, China and
    Malaysia.



                      This information is provided by RNS
            The company news service from the London Stock Exchange