Acquisition

Chamberlin & Hill PLC
16 March 2004

                             CHAMBERLIN & HILL PLC

                                 16 March 2004

This announcement is not for release, publication or distribution in or into the
United States, Canada, Australia, Japan or the Republic of Ireland



Proposed acquisition of the business, assets and liabilities of Russell Castings


                CHAMBERLIN & HILL EXPANDS FOUNDRY CAPABILITIES

                       WITH ACQUISITION OF RUSSELL CASTINGS



Key Points:

•       Proposed acquisition of Russell Castings, one of the principal UK iron
        foundries involved in the production of high integrity spheroidal 
        graphite ductile iron, austempered ductile iron and grey iron castings

•       Extends the overall product range of the Company and provides the
        capability to produce castings of a size that complement those currently
        manufactured

•       Potential to access new markets as Russell Castings has a different
        customer base from Chamberlin & Hill

•       Strengthen the market position of the Company in the foundry sector
        where the Directors believe further consolidation will occur

•       Initial consideration is £0.5 million payable upon completion and £0.5
        million payable on 1 October 2004



Barrie Williams, Chief Executive of Chamberlin & Hill, commented:

'The acquisition of Russell Castings provides a real growth opportunity for the
company expanding our range of castings and assuring continuity of supply for
our customers. We will look forward to the future with a greater sense of
optimism'

This summary should be read in conjunction with the full text of the attached
announcement.



Enquiries:

Chamberlin & Hill plc   Tom Brown, Chairman                Tel: [phone]
                        Barrie Williams, Chief Executive   Tel: [phone]
                        Peter Bell, Finance Director       Tel: [phone]

Ernst & Young LLP       Oliver Baker                       Tel: [phone]
                        John Stephan                       Tel: [phone]
                        Pratish Sthankiya                  Tel: [phone]



Ernst & Young LLP of 1 More London Place, London, SE1 2AF, is acting exclusively
for Chamberlin & Hill and no one else in connection with the Acquisition and
will not be responsible to anyone other than Chamberlin & Hill for providing the
protections afforded to clients of Ernst & Young nor for providing advice in
relation to the Acquisition.



                             CHAMBERLIN & HILL PLC

                                  16 March 2004

This announcement is not for release, publication or distribution in or into the
United States, Canada, Australia, Japan or the Republic of Ireland



Proposed acquisition of the business, assets and liabilities of Russell Castings

Introduction

Chamberlin & Hill announces the proposed acquisition of the business, assets
(excluding cash) and liabilities of Russell Castings, an iron foundry business
based in Leicester.  Russell Castings is a division of Elliott.

The initial consideration is £0.5 million payable upon completion and £0.5
million payable on 1 October 2004. The acquisition will be funded by an
extension of the Company's existing overdraft facility.

In view of the size of the acquisition of Russell Castings, Shareholders'
approval is required and will be sought at an Extraordinary General Meeting,
notice of which will be included in the Circular which is being published
shortly. The Board believes that the Acquisition is in the best interests of
Chamberlin & Hill and its Shareholders as a whole.

Further details relating to the Acquisition are summarised below and will be set
out in the Circular to Shareholders.

Background to and reasons for the Acquisition

The Directors believe that, with a strong balance sheet, Chamberlin & Hill is in
a position to take advantage of any opportunities which emerge from the present
market conditions in the foundry sector where the Directors believe further
consolidation is likely.  The Board has previously stated that its acquisition
strategy remains one of pursuing appropriate opportunities and believes that the
Acquisition of Russell Castings provides an excellent way of expanding
Chamberlin & Hill's niche sector foundries and consolidating its market position
as a leading manufacturer of iron castings in the UK.

The Directors believe that the product range of Russell Castings will extend the
overall product range of the Group and provide the Group with the capability to
produce castings of a size that complement those currently manufactured within
the Group. The Acquisition will provide the Group with the potential to access
new markets as Russell Castings has a different customer base from Chamberlin &
Hill. The Directors believe that the Acquisition will also provide the
opportunity to cross-sell products to the respective customer bases. In addition
Russell Castings brings certain technical capabilities and management skills to
Chamberlin & Hill whilst the breadth of manufacturing and casting expertise in
Chamberlin & Hill will bring benefits to the Russell Castings business.

The Directors intend to explore the synergy opportunities for Russell Castings
with Chamberlin & Hill's existing foundries in Walsall, Bloxwich and Scunthorpe.
This may involve some potential restructuring and associated cost.

Terms of the Acquisition

On 15 March 2004, Chamberlin & Hill entered into an agreement to acquire from
Elliott the business, assets (excluding cash) and liabilities of Russell
Castings for an aggregate consideration of £1 million.  The consideration is
payable £0.5 million on Completion and £0.5 million on 1 October 2004. The
second payment will be reduced on a pound for pound basis to the extent that the
working capital of Russell Castings (excluding cash) at Completion is less than
£1 million.

The Property has been conditionally sold by Elliott to a property company and
Elliott itself will on completion of such sale be granted a lease which permits
it to occupy the site or to grant a sub-lease.  Chamberlin & Hill will on
Completion be granted the Property Lease by Elliott which permits Chamberlin &
Hill to occupy the Russell Castings site in Leicester rent free until 31 March
2005.  Chamberlin & Hill intends to use the site during the period of the
Property Lease whilst it evaluates its options for the longer term manufacture
of Russell Castings' products.

Information on Russell Castings

Russell Castings is one of the principal UK iron foundries involved in the
production of high integrity spheroidal graphite ductile iron, austempered
ductile iron and grey iron castings primarily in the weight range of 1kg to
500kg.

Russell Castings is a well established business, having traded for over 130
years since formation in 1864. In 1953 Russell Castings was one of the first
foundries in the UK to actively promote the sale of ductile iron castings and
from that time has been recognised for the commercial development of the full
range of ductile iron materials. Today, it operates from a 4.2 acre site in
Leicester, which is not being acquired.

Elliott acquired Russell Castings in 1967, initially as a source of castings for
its machine tool activities. From the mid 1980's, Russell Castings's strategy
has been to diversify its customer portfolio by concentrating upon higher value,
more complex castings and the provision of value added packages. More emphasis
was put on customer service, delivery times, higher quality castings and added
value with the objective of building a stable, higher profit foundry.

The industries served by Russell Castings are diverse, being part of the
strategy to avoid over-exposure to any one particular industrial sector. Sectors
include commercial vehicles, materials handling, hydraulic valve and motor,
railways and water and gas. Russell Castings has over 200 customers, the largest
of which accounted for 19.9 per cent. of its turnover in the year ended 30 March
2003.

The financial record of Russell Castings as set out below has been extracted
without material adjustment from the Accountants' Report set out in Part II of
the Circular. Shareholders should read the whole of the Circular and not rely on
the summarised information below.


For the year ended 30 March 2003 and the two years ended 31 March        2003          2002          2001
2002 and 2001                                                            £000          £000          £000

Turnover                                                                9,771        10,512        11,817
Operating profit                                                          522           344           742
Profit before tax                                                         506           342           733

At 30 March 2003, the net assets of Russell Castings amounted to £3.2 million.

In common with the UK engineering and manufacturing industries in general,
Russell Castings has seen lower demand in the past two years, together with some
business lost to competition.

Financial effects of the Acquisition

The Directors of Chamberlin & Hill expect the acquisition of Russell Castings to
be earnings enhancing in the year ending 31 March 2005. This statement should
not be interpreted to mean that Chamberlin & Hill's future earnings per share
will necessarily be greater than its historic published earnings per share.

The Board is proposing to take advantage of Chamberlin & Hill's significant
amount of unused debt capacity to finance the Acquisition and any restructuring
or related capital expenditure involved.

Current trading and prospects

The Group announced on 6 November 2003 its interim results for the six months to
30 September 2003.  The Group reported a profit before tax of £0.6 million
(2002: £0.7 million) on sales of £13.2 million (2002: £13.8 million).  The Group
had net cash of £0.3 million and net assets of £13.8 million as at 30 September
2003.

Since a low point in November 2003 trading volumes have started to improve,
albeit slowly, in line with demand.  Exceptional increases in the cost of metals
and foundry coke have reduced margins until these price rises can be passed on
to customers.

Looking ahead to the new financial year, additional volume of sales of at least
£2 million per annum has been secured for the Walsall and Bloxwich foundries
following the closure of one of our competitors, the Henley foundry, at the end
of 2003.  The Directors believe that this, combined with our expectations for
the acquisition of Russell Castings, will enhance the ongoing prospects of the
Enlarged Group.

Extraordinary General Meeting

Included with the Circular which will shortly be distributed to Shareholders is
a notice convening the EGM to be held at Chamberlin & Hill plc, Chuckery Road,
Walsall, WS1 2DU at 9.30 a.m. on 2 April 2004. At the meeting a resolution will
be proposed to approve the Acquisition Agreement.



Enquiries:

Chamberlin & Hill plc   Tom Brown, Chairman                   Tel: [phone]
                        Barrie Williams, Chief Executive      Tel: [phone]
                        Peter Bell, Finance Director          Tel: [phone]

Ernst & Young LLP       Oliver Baker                          Tel: [phone]
                        John Stephan                          Tel: [phone]
                        Pratish Sthankiya                     Tel: [phone]



Ernst & Young LLP of 1 More London Place, London, SE1 2AF, is acting exclusively
for Chamberlin & Hill and no one else in connection with the Acquisition and
will not be responsible to anyone other than Chamberlin & Hill for providing the
protections afforded to clients of Ernst & Young nor for providing advice in
relation to the Acquisition.


Definitions

The following words and expressions have the following meanings in this
announcement unless the context requires otherwise:


'Acquisition'                   The proposed acquisition of Russell Castings as described in Part I of
                                the Circular

'Acquisition Agreement'         The conditional sale and purchase agreement dated 15 March 2004 between
                                (1) Elliott, (2) Russell Castings Limited, (3) Platt Malleable Castings
                                and (4) Chamberlin & Hill, details of which are set out in Part IV of
                                the Circular

'Chamberlin & Hill' or          Chamberlin & Hill plc
'Company'

'Circular'                      The Circular to be sent shortly to Shareholders setting out details of
                                the Acquisition

'Completion'                    Completion of the Acquisition in accordance with the terms of the
                                Acquisition Agreement

'Directors' or 'Board'          The directors of Chamberlin & Hill as at the date of this document whose
                                names are set out on in paragraph 2 of Part V of the Circular

'Elliott' or 'Vendors'          Elliott Industries Limited

'Enlarged Group'                The Group as enlarged by the Acquisition

'Extraordinary General Meeting' The extraordinary general meeting of the Company to be held at Chuckery
or 'EGM'                        Road, Walsall, WS1 2DU on 2 April 2004 at 9.30 a.m., notice of which is
                                set out at the end of the Circular

'Group' or 'Chamberlin & Hill   Chamberlin & Hill and its existing subsidiary undertakings
Group'

'Ordinary Shares'               Ordinary shares of 25p each in the capital of the Company

'Platt Malleable Castings'      Platt Malleable Castings Limited, a wholly owned subsidiary of
                                Chamberlin & Hill, whose name will be changed to Russell Castings
                                Limited immediately following Completion

'Property'                      Elliott's freehold premises at Bonchurch Street, Leicester registered
                                under title number LT220237

'Property Lease'                The lease to occupy the Property between (1) Elliott and (2) Chamberlin
                                & Hill to be entered into pursuant to the Acquisition Agreement, details
                                of which are set out in Part IV of the Circular

'Russell Castings' or 'Business'The business, assets and liabilities of Elliott, trading as Russell
                                Castings and proposed to be purchased by Platt Malleable Castings
                                pursuant to the Acquisition Agreement

'Shareholders'                  Holders of Ordinary Shares





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