Re Contract

Balfour Beatty PLC
16 June 2003

BALFOUR BEATTY JOINT VENTURE REACHES FINANCIAL CLOSE FOR £100 MILLION ROTHERHAM
SCHOOLS PROJECT



Balfour Beatty plc, the international engineering, construction and services
group, announces today that Transform Schools (Rotherham) Ltd, a concession
joint venture between Balfour Beatty plc and Innisfree, has reached financial
close for its £100 million PFI schools project for the Metropolitan Borough of
Rotherham.



The concession contract includes the construction of 10 new schools and the
upgrade and refurbishment of a further five.  The contract, which covers a mix
of both secondary and primary schools, also includes energy management, repairs
and maintenance, caretaking, cleaning and catering.



Mike Welton, Chief Executive of Balfour Beatty plc, commenting today, said: 'We
are delighted to be working with Rotherham Metropolitan Borough Council in
providing schools that will offer a much enhanced learning environment and in
supporting the Council's objective of raising educational standards across the
Borough.'



Rotherham Borough Council Leader, Mark Edgell, said: 'This is a real opportunity
to transform Rotherham's school buildings.  Our pupils and teachers deserve the
kind of environment where teaching and learning can flourish.  Balfour Beatty
has an excellent record of partnership working with other schemes, and we are
confident this will be a success.'



The concession period will run for 31 years.  Construction work, which commenced
on 1 April 2003, is scheduled to be complete in 42 months.  Facilities
management services will commence on 1 April 2004.



The project is the largest community schools initiative of its type,
incorporating grant aided youth, Life Long Learning and SureStart facilities.
Balfour Beatty has worked with Rotherham Borough Council to ensure the new and
improved facilities are made available to the widest possible cross-section of
the community through a Not for Profit Company - the first time such
arrangements have been introduced alongside a PFI contract.



A joint venture of Balfour Beatty Construction Limited and Balfour Kilpatrick
Limited, the Group's multi-services and power systems business, will assume
responsibility for the construction programme.  Haden Building Management, also
a Balfour Beatty company, will provide facilities management and services.



This is the second schools concession won by Balfour Beatty in joint venture
with Innisfree.  In October 2000, Transform reached financial close with the
Stoke-on-Trent City Council for the £153 million Stoke Schools contract, the
largest grouped schools project in England, under which the company is building
nine new schools and progressively refurbishing the remainder of the entire 122
schools estate.



Also in the education sector, Balfour Beatty Construction is the design and
build partner in the Babcock and Brown PFI consortium which has reached
financial close on three major school developments with a combined construction
value of over £81 million.





Enquiries to:

Tim Sharp

Tel: [phone]

www.balfourbeatty.com





Notes to Editors





Balfour Beatty and PPP



In addition to its education interests, Balfour Beatty has a range of Public
Private Partnerships:-



1.         Balfour Beatty has three healthcare concessions, the Edinburgh Royal
Infirmary and North Durham Hospital, through Consort Healthcare, and the
University College London Hospital.  The total construction value of these three
projects is approaching £500 million, with more than £330 million accruing
through long-term asset management contracts.  Balfour Beatty's equity
contribution to these three hospital projects is £24 million.



Balfour Beatty is also preferred bidder for Blackburn Hospital, which it
anticipates will reach financial close in the near future.



2.         Balfour Beatty has four road concessions - the A1/M1 Link in
Yorkshire through Yorkshire Link, the A50 in Derbyshire and the A30/A35 in Devon
and Dorset and, more recently, the M77 motorway in Scotland, through Connect.
The equity investment in this sector is £38 million, the construction value is
£516 million with associated service contracts in excess of £100 million.



3.         As part of the Metronet consortium, Balfour Beatty is responsible for
infrastructure development and maintenance for the Bakerloo, Central and
Victoria Lines and the Sub-Surface Lines for the London Underground PPP.  It is
also responsible for the maintenance, operation and development of London
Underground's high-voltage power distribution system, as a member of the
Seeboard Powerlink joint venture.



4.         The Group's prototype involvement in private finance came through its
25.5% interest in Barking Power Station, a project which has operated since 1995
and which was built by a consortium led by Balfour Beatty.



5.         The Aberdeen Waste Water project, a 30-year concession for the
finance, design, building, operation and maintenance of four water treatment
plants in the north of Scotland, reached financial close in 2000.




                      This information is provided by RNS
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