ReSubsid's Project Developmnt

Kier Group PLC
15 May 2000


                            
       KIER CONSORTIUM COMPLETES FINANCIAL CLOSURE
             ON FIRST PFI HOSPITAL FOR WALES
     
Kier  Group  plc,  the  international  construction   and
services   company,  announces  that  its  wholly   owned
subsidiary,  Kier  Limited, part of a  consortium  formed
with   Baglan  Moor  Healthcare  Holdings  (Baglan   Moor
Healthcare),  in which it holds a 25% equity  stake,  has
completed  financial closure on the Neath &  Port  Talbot
Hospital  in  Baglan, South Wales.  This  project,  worth
£432m  over the 27 1/2 year concessionary period,  is  the
first  major  Welsh  hospital to be  provided  under  the
Private  Finance  Initiative.  As part  of  the  project,
Caxton  Facilities Management, Kier Group's Cardiff-based
subsidiary,   will   provide  the  non-clinical   support
services through an FM contract worth £160m.

The  new hospital will provide 270 beds, outpatients, day
hospital facilities, rehabilitation, palliative  care,  a
mental  health  unit  and  a  full  range  of  diagnostic
services.   Work  on the 30 month construction  programme
starts this week.

Under  the  concession agreement with Bro  Morgannwg  NHS
Trust  (the Trust), Baglan Moor Healthcare will construct
and  operate the new hospital facility for the Trust with
a  full range of support services over a 27 1/2 year period,
the  Trust  remaining in full control  of  core  clinical
services.

Other  members  of the Baglan Moor Healthcare  consortium
are  specialist healthcare designers SSL, Tilbury Douglas
plc and Charterhouse Project Equity Investments Ltd.  The
£66m  funding has been provided by Greenwich NatWest  via
an  Index-Linked  bond  supported by  Financial  Security
Assurance (UK) Ltd.

Kier Group Chairman, Colin Busby, commented:  'This is an
important achievement for Kier Group in two respects.  It
consolidates our position as a leading player in the  PFI
healthcare  sector.  Having secured the first  major  PFI
hospital in Scotland at Hairmyres for our consortium HDGH
Holdings  Ltd,  we have now repeated the  achievement  in
Wales at Baglan Moor.  It also marks a major step forward
in establishing our FM business with Caxton FM securing a
major  long term contract in the rapidly-growing hospital
services sector.'


Enquiries:

Colin Busby, Chairman & Chief Executive
Kier Group plc
Tel:  [phone]

Caroline Sturdy, Associate Director
Bell Pottinger Financial
Tel:  [phone]