Acquisition

Centrica PLC
25 July 2001


July 25, 2001


Centrica announces first major acquisition for AA

Centrica plc, which owns the Automobile Association, announced today that it
has agreed to acquire Halfords garages, the largest independent chain of car
repair, service and maintenance centres in the UK.

The purchase, from The Boots Company for a consideration of £5.75 million in
cash, is Centrica's first major acquisition investment on behalf of the AA and
is expected to complete on 31 August.

The agreement includes all 129 car repair centre businesses. This will allow
the AA to build on its core strategy of providing essential motoring services
for members and other motorists.

Through this deal, the AA will further strengthen its customer relationships
by broadening its range of services to cover everyday car maintenance and
repair.

Most of the garages are located on the same sites as Halfords retail stores.
These retail stores will remain part of The Boots Company, run entirely
separately. Around 1200 staff will transfer to Centrica.

Roger Wood, Centrica's Executive Director responsible for AA Road Services,
said: 'We are extremely pleased to acquire Halfords garages. Halfords has
established a strong position in this market and the AA will build on that
reputation under its own brand so as to offer high quality service to members
and motorists generally.'

The acquisition will allow the AA to introduce a range of other benefits for
members and customers, including vehicle servicing, on site vehicle
inspections and the services that Halfords currently provides such as free
brake and tyre checks.

 David Thompson, Deputy Chief Executive and Finance Director of The Boots
Company, said: 'This is a good deal for customers, staff and shareholders. The
AA's expertise in motoring services will provide new opportunities to grow the
garage business. We are looking forward to working closely with the AA,
ensuring a smooth transfer of the garage business as a prelude to a good
relationship for the future.'

Enquiries:

Centrica Investor Relations:            01753 758114

Centrica Media Relations:               07979 560554

Motoring, consumer and transport media enquiries

AA Press Office:                        01256 492927





Notes:


 1. In Britain, energy and services group Centrica plc trades under the British
    Gas/Scottish Gas, Goldfish, One.Tel and AA brands. In Canada, Centrica
    trades through the established Direct Energy brand and in the United
    States through Energy America.

 2. Centrica acquired the Automobile Association in September 1999.