Re Contract

Balfour Beatty PLC
30 October 2000


BALFOUR BEATTY REACHES FINANCIAL CLOSE - STOKE SCHOOLS PFI CONTRACT
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Balfour Beatty plc, the international engineering, construction and services
group, announces today that Transform Schools, a concession joint venture
between Balfour Beatty plc and Innisfree, has reached financial close with the
Stoke-on-Trent City Council for the £153 million Stoke Schools PFI contract,
the largest grouped schools project to have progressed this far in the UK.

In the initial five years of the 25-year concession, Transform, working with
its design and build contractor Stoke Schools JV, a joint venture between
Balfour Beatty Construction and Balfour Kilpatrick - both Balfour Beatty
subsidiaries, will assume responsibility for building nine new schools and a
progressive programme of refurbishment of the rest of the estate, under a
contract valued at £80 million.

Mike Welton, Chief Executive of Balfour Beatty plc, commenting today, said:
'We are delighted to have brought this major scheme to financial close and to
be able to begin working with Stoke-on-Trent City Council.  In creating 21st
Century standards for the city's schools, we will help make a real difference
to the quality of education in the city.'

Transform Schools, through Haden Building Management, also a Balfour Beatty
company, will provide energy management and ongoing repairs and maintenance
for all 122 schools within Stoke-on-Trent from early November 2000.  As the
design, new build and refurbishment is completed, Transform, with Haden, will
enhance this service to maintain the buildings in the entire Schools Estate to
defined environmental standards.

The project was originally conceived as an energy saving project.
Consequently, a principal feature of the contract is that the programme of
refurbishment works and the design of new buildings will ensure efficient use
of energy and water to deliver substantial reductions in the consumption of
energy and water by the schools over the life of the project.

The financial closure of the Stoke Schools project takes Balfour Beatty's
portfolio of PFI concessions to 11.  Balfour Beatty was one of the first and
is amongst the most successful entrants into the privately financed
infrastructure market.  This portfolio is an increasingly important part of
its business and represents significant embedded value for the group.

Enquiries to:
Tim Sharp
Tel: [phone]
www.balfourbeatty.com


Notes to Editors
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1.  In the healthcare sector, Balfour Beatty has three concessions, the
Edinburgh Royal Infirmary and North Durham Hospital, through Consort, and the
University College London Hospital.  The total construction value of these
three projects is approaching £500 million, with more than £330 million
accruing through long-term asset management contracts.  Balfour Beatty's
equity contribution to its three hospital projects is £24 million.

2.  The group's prototype involvement in private finance came through its
25.5% interest in Barking Power Station, a project which has continued to
produce substantial profits since its opening in 1995 and which was built by a
consortium led by Balfour Beatty.

3.  Also in the power sector, Balfour Beatty has been, since April 1999,
responsible for the maintenance, operation and development of London
Underground's high-voltage power distribution system, as a member of the
Seeboard Powerlink joint venture.  The concession company is served by PADCo
(a joint venture with Seeboard and ABB, in which Balfour Beatty has a 25%
stake), which takes practical responsibility for the £98 million, five-year
initial capital works and the associated maintenance.  Dundee Energy
Recycling, a joint venture with Macquarie Infrastructure Group and Dundee City
Council, has recently commissioned a £35 million-plus energy-from-waste plant
in Dundee.

4.  Balfour Beatty has three road concessions - the A1/M1 Link in Yorkshire
through Yorkshire Link, and the A50 in Derbyshire and the A30/A35 in Devon and
Dorset through Connect.  The equity investment in this sector is £16 million,
the construction value was £384 million with associated service contracts of
approaching £100 million.

5.  Balfour Beatty recently reached financial close on the £80 million
Aberdeen Waste Water project, a 30-year concession for the finance, design,
building, operation and maintenance of four water treatment plants in the
north of Scotland.

6.  As part of the Metronet consortium, Balfour Beatty has prequalified for
both the deep line concessions for the London Underground PPP and for the sub-
surface lines.