Contract Win

Kier Group PLC
4 May 2001


                               KIER GROUP PLC
                         KIER ANNOUNCES PFI DOUBLE

Kier Group, the construction, support services and house building group, 
announces the signing of a further PFI project in the healthcare sector, 
consolidating its strong position in this market.  Kier Group also 
announces its appointment as preferred bidder for a PFI project in the 
education sector.

Kier, with equity investor Innisfree, has today reached financial close on 
a new PFI hospital for Reading on behalf of the Berkshire Healthcare NHS 
Trust.

Kier forms 50% of the consortium, Prospect Healthcare, which will build and 
run the non-clinical services of the new hospital at Prospect Park, 
Reading, over a 30-year concessionary period in a project worth £198m.  
Facilities management provider is ISS Mediclean.  Construction work by Kier 
Build, part of the Kier Group, will begin shortly under a £24.5m, 22-month 
contract with Prospect Healthcare.

The new 203-bed hospital will cater for a range of acute, intensive care, 
rehabilitation and long-term needs for mental health patients.

This represents Kier Group's third major PFI healthcare contract and is the 
first major mental health PFI project in the country.  The Company recently 
handed over Scotland's first major PFI hospital at East Kilbride three 
months ahead of schedule and work on Wales' first major PFI hospital at 
Baglan Moor is progressing well.

The success at Reading comes shortly after Kier, with its partner, Dexia 
Public Finance Bank, was appointed preferred bidder for an important 
education scheme by Essex County Council.  Under the Tendring Primary 
Schools Public Private Partnership project, four primary schools in North 
East Essex will be rebuilt and a further eight extensively remodelled and 
refurbished; the schools will also be maintained and serviced over a 32-
year period.  Construction will be carried out by Kier Regional under a 
£14m design and build contract and facilities management services of 
approximately £0.75m per annum will be provided by Kier's support services 
division.

Kier Group chief executive Colin Busby said:  'These two successes confirm 
our momentum in building up our PFI activities, particularly in healthcare, 
and in adding further long-term contracts to our support services order 
book.  PFI and PPP will play a growing part in the provision of 
infrastructure in health, education and many other public services.  Kier 
will continue to play its part in these initiatives'.