Invensys' Aerospace Division Acquired for $175m

Smiths Industries PLC
16 December 1999


Smiths Industries acquires 
Invensys' aerospace division for $175 million

In a move to extend its range of aerospace electronics into a closely-related
area of systems and components for aircraft, Smiths Industries plc has agreed
to acquire the aerospace division of Invensys plc for a total of $175 million
(£109 million). The business, based in the United States, specialises in
products for electrical power management and aircraft utilities, in which
Smiths Industries is already a technology leader. Invensys is making the
disposal as part of its strategy to refocus on industrial automation and
control.

The acquisition of this complementary activity will strengthen Smiths
Industries' position as a supplier of highly-integrated systems for both civil
and defence aerospace applications. Keith Butler-Wheelhouse, Chief Executive
commented: 'This was an opportunity too good to miss, and Allen Yurko and I
have dealt directly on a willing seller/willing buyer basis. The business has
good synergies with our existing aerospace operations. It is exactly the type
of acquisition we are looking for to broaden our capability as a first-tier
supplier to the major aircraft manufacturers.'

The business being acquired employs 850 people at four main locations in New
York, Illinois, Ohio and California. Sales and profits (before interest and
tax) recorded by the Invensys aerospace division, in the 12 months ended 30
September 1999, were $120 million and  $19 million respectively. Once integrated
within Smiths Industries Aerospace, the business will benefit from: 
    Utilising the Smiths Industries marketing organisation and customer
    relationships,
    Enhanced aftermarket revenues through the Smiths Industries' Product
    Support operations,
    The integration of product lines wherever this gives an expanded systems
    capability, and
    Combined future product development programmes.

Smiths Industries will pay the total consideration in cash on completion, and
will fund the purchase from dollar-denominated debt. The book value of net
tangible assets being acquired is approximately $50 million, and the balance
of the consideration comprises goodwill, which Smiths Industries plans to
amortise over 20 years. Completion is expected by the end of January, and is
subject to approval by the US authorities under the Hart-Scott-Rodino process.

The most widely-recognised trading name in the acquisition is Barber-Colman
Aerospace, which makes complete environmental control systems for aircraft.
This capability is a logical extension to the total utilities management
systems supplied by Smiths Industries for both civil and military aircraft.
Other units within the business being acquired include: Aerospace Avionics,
making power conversion units and cockpit warning panels, primarily for
military applications; Lambda Advanced Analog, making hybrid circuit power
supplies for spacecraft, military and industrial use; Lambda Novatronics
making special-application electronic power systems, and Tech Development,
making turbine air motors. Each of these product lines provides opportunities
to enhance the level of systems integration being offered by Smiths Industries
to the aircraft prime manufacturers.

Smiths Industries Aerospace, which this acquisition will join, is a world
leader in the development of advanced aerospace electronics and a first-tier
supplier of systems to the major aircraft manufacturers, the UK Ministry of
Defence and the US Department of Defense. In addition to aerospace, Smiths
Industries plc is a leading supplier of medical systems and specialised
industrial products. The company employs 15,000 people and generated profits
of £241 million on sales of £1.3 billion in the year-ended 31 July 1999.
Further information is available on the company's website:
www.smiths-industries.com.

Invensys plc is a global leader in the Automation and Controls industry. With
its head office in London, England it operates in all regions of the world
through four focused divisions - Intelligent Automation, Industrial Drive
Systems, Power Systems and Controls. The Group was formed on 
4 February 1999 through the merger of BTR plc and Siebe plc.

Further enquiries:

Russell Plumley
Richard Bayliss:          [phone]
Smiths Industries plc

Barry Francis            [phone]
Ceri Williams           [phone]
Invensys plc

Simon Holberton       [phone]
Ben Brewerton
Brunswick