Proposed Acquisition of E'town Corp. - Part 1

Thames Water PLC
22 November 1999

                       THAMES WATER PLC ('THAMES WATER')
                       ---------------------------------
                                       
             PROPOSED ACQUISITION OF E'TOWN CORPORATION ('E'TOWN')
             -----------------------------------------------------
                                       
                 PROVIDES FOR FURTHER NORTH AMERICAN EXPANSION
                 ---------------------------------------------
                                       

Part 1

Summary
-------

*         Thames Water announces that it has reached agreement to acquire
          E'town, one of the largest investor owned water utilities in the
          United States, at a price of GBP367.9 million; in addition, Thames
          Water will be assuming the net debt of E'town, which at the end of
          September 1999 stood at GBP206.7 million.

*         In 1998 E'town achieved operating profits of USD51.6 million on
          turnover of USD145.5 million.  E'town, which operates in New Jersey,
          is a highly attractive business bringing:

          -         a growing utility operation based in a heavily populated
          area;
          -         established operating & maintenance (O&M) contracts with
                    significant development potential; and
          -         a strong management team with a proven track record.

*         Significant new opportunities are in prospect in the North American
          water and waste water market, and Thames Water and E'town believe
          that together they will be in a strong position to secure additional
          business.  They also see opportunities for sharing best operating
          practices between the two companies.  Thames Water expects that the
          transaction will enhance earnings for Thames Water shareholders in
          the first full year following completion (on a pre-goodwill basis
          and taking account of certain tax credits) with further enhancement
          expected in the following year.

*         The acquisition will accelerate the growth in the proportion of
          Thames Water's business operating outside its regulated UK utility.
          Annualised North American turnover is expected to treble to
          approximately GBP150 million.

*         The transaction is subject, inter alia, to the approval of E'town
          shareholders, anti-trust clearance and New Jersey utility regulatory
          approval, expected to be secured before the last quarter of 2000.
          It is intended that the purchase will be funded from Thames Water's
          existing and new debt facilities.

Commenting on the acquisition, Bill Alexander, Chief Executive of Thames Water
said:

'This transaction will reinforce our position as the leading company solely
focused on providing water and waste water operations and services around the
world.

Thames Water has been building its presence in the US for some time and we
have concluded that the scale and speed with which we can secure new business
would be significantly enhanced by this acquisition.  E'town has a proven
track record, is well placed for growth and operates in a region with strong
potential.  In addition, we share a passion for excellence in customer service
and together our capability to address opportunities on a broader front will
be considerably strengthened.'

Commenting on the acquisition, Anne Evans Estabrook, Chairman of E'town said:

'The Board of E'town believes that the offer by Thames Water is in the best
interests of our shareholders, customers and employees who will all benefit
from the advantages of E'town becoming part of a larger international group.

The offer has the Board's full support and management looks forward to
developing the business vigorously as part of Thames Water.'

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

A presentation for investment analysts will be held today at 9.30am at
Smeaton's Vaults, The Brewery, Chiswell Street, London, EC1.

A conference call for analysts and shareholders will be held today at 3.00pm.
Please call Emma Moran at Bell Pottinger on 0171 353 9203 if you wish to
participate.



Enquiries:

Thames Water Plc    0171 636 8686       E'town Corporation  [phone]

Bill Alexander                          Andrew M Chapman
David Luffrum

Lazard              0171 588 2721       Salomon Smith Barney          +1 212
816 0989

Christopher Fisher                      Henry A Clarke
Mark McMaster
John Wilford

Bell Pottinger      0171 353 9203

David Beck


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