Acquisition & Placing

Tanfield Group PLC
28 June 2007


28 June 2007

                             THE TANFIELD GROUP PLC
                         ('Tanfield' or the 'Company')


                Proposed acquisition of Snorkel Holdings LLC and
                     Proposed placing to raise £115 million


The Tanfield Group Plc, the leading manufacturer of zero emission electric
vehicles and aerial work platforms, is pleased to announce the proposed
acquisition (the 'Acquisition') of the entire issued share capital of Snorkel
Holdings LLC ('Snorkel') and a conditional placing to raise £115 million (before
expenses) (the 'Placing').


Snorkel is a worldwide supplier of high quality industrial aerial work
platforms. The products have a wide range of working at height applications and
are supported by service, parts and training teams. Snorkel has significant
manufacturing capabilities along with strong sales and distribution, in the USA
and Australasia.


HIGHLIGHTS


• Conditional agreement to acquire the entire share capital of Snorkel for
US$100m (£50m) and assume approximately US$25.0 million (£12.5 million) of
debt. The Acquisition is to be satisfied as to US$95.0 million in cash,
which is to be funded from the Placing. In addition, the Acquisition is to
be satisfied as to US$5.0 million by granting to the sellers of Snorkel (the
'Sellers') the right to receive 1,535,662 ordinary shares of £0.01 each in
the Company (the 'Consideration Shares') on the first or second anniversary
of completion of the Acquisition


• The Placing will raise £115 million (before expenses) for the Company


• Net proceeds of the Placing to fund the cash portion of the
consideration for the Acquisition as well as to provide Snorkel with additional
working capital which the Directors expect will expedite growth and improve
margins through more efficient purchasing. In addition, the placing proceeds
will be used to pay down approximately $25million (£12.5 million) of debt in the
Snorkel Group and will leave the Enlarged Group debt free


• A portion of the Placing proceeds will also provide additional working
capital to establish Smith Electric Vehicles in the USA, capitalising on the
current opportunities available for zero emission commercial vehicles in
North America


• Significant increase in Tanfield's geographic coverage, product range
and scale of operations - the Enlarged Group will have a global sales footprint
and a more efficient global supply chain


• Enlarged and diversified powered access customer base, providing
immediate cross-selling opportunities


• The Directors believe the Acquisition will deliver product synergies
and little overlap between Tanfield's Powered Access division and Snorkel and
that there is substantial operating and revenue synergy potential across the
Enlarged Group


• The Directors expect the Acquisition to be earnings enhancing in the
first full financial year following the acquisition


• Smith Electric Vehicles continues to make good progress with major
fleet operators for its higher function commercial electric vehicles. Tanfield's
Powered Access division, led by UpRight Powered Access, continues to demonstrate
significant growth


Commenting, Darren Kell, Chief Executive of Tanfield said:

'This is a transformational acquisition for Tanfield, significantly
strengthening our position as a leading global manufacturer of aerial work
platforms and commercial electric vehicles.


This acquisition is an excellent strategic and cultural fit with our existing
UpRight Powered Access division.


The addition of manufacturing capability in the USA and Australasia, plus
established sales networks in these territories, will create a Powered Access
division with comprehensive global coverage.


There is very little overlap between the UpRight and Snorkel product ranges;
presenting significant cross-selling opportunities in UpRight's core territories
of Europe and the Middle East and Snorkel's core markets of North America and
the Asia-Pacific region.


This fundraising will also provide Tanfield with the resources to establish
Smith Electric Vehicles in North America, with a view to recreating the
first-to-market success already enjoyed by Smith Electric Vehicles in the UK and
mainland Europe.'


For further information:

The Tanfield Group Plc                    Tel: [phone]
Darren Kell, Chief Executive              [e-mail]
Charles Brooks, Finance Director

Fishburn Hedges                           Tel: [phone]
James Benjamin                            Mob: [phone]
                                          [e-mail]

Cenkos Securities plc                     Tel: [phone]
Stephen Keys

St. Helen's Capital plc                   Tel: [phone]
Seb Wykeham
Ruari McGirr



                        website: www.tanfieldgroup.co.uk


                             THE TANFIELD GROUP PLC


                Proposed acquisition of Snorkel Holdings LLC and

                     Proposed placing to raise £115 million


The Company announces that it has entered into a conditional agreement to
acquire Snorkel Holdings LLC and a conditional placing agreement to raise £115
million (before expenses) through an institutional placing of new Ordinary
Shares by Cenkos Securities, the Company's Nominated Adviser and Joint Broker
and St Helen's Capital plc, the Company's Joint Broker.


It should be noted that the Placing is subject to the terms of a placing
agreement between the Company, the Directors and Cenkos (the 'Placing
Agreement') and is conditional upon, inter alia, the passing of the special
resolution at the Extraordinary General Meeting of the Company to be held on 23
July 2007 the ('Extraordinary General Meeting') and the Placing Agreement
otherwise becoming unconditional in all respects and not being terminated in
accordance with its terms. Both the Acquisition and the Placing are subject to
admission of the shares to be issued under the Placing to AIM ('Admission').

The Directors will utilise the net proceeds of the Placing to fund the cash
portion of the consideration for the Acquisition as well as to provide Snorkel
with additional working capital which the Directors expect will expedite growth
and improve margins through more efficient purchasing. In addition, the placing
proceeds will be used to pay down approximately $25million (£12.5 million) of
debt in the Snorkel Group and will leave Tanfield, as enlarged by the
Acquisition (the 'Enlarged Group') debt free. The Directors also intend to use a
proportion of the proceeds to provide additional working capital to establish
Smith Electric Vehicles in the USA which the Directors anticipate will put the
Company into a position to capitalise on the current opportunities available for
zero emission commercial vehicles in North America.


The Directors believe that the Acquisition will allow the combined businesses of
Snorkel and the Company's existing subsidiary, UpRight, to compete effectively
with the industry leaders in nearly all product categories and, at the same
time, provide the Enlarged Group with a global sales footprint and more
efficient supply chain.


The Acquisition


The Company has conditionally agreed to acquire the entire share capital of
Snorkel for US$100.0 million (£50.0 million) and will assume approximately
US$25.0 million (£12.5 million) of debt. The Acquisition is to be satisfied as
to US$95.0 million in cash, which is to be funded from the Placing, and is
described in further detail below. In addition, the Acquisition is to be
satisfied as to US$5 million by granting to the Sellers the right to receive the
Consideration Shares on the first or second anniversary of completion of the
Acquisition. The number of Consideration Shares to be issued by the Company may
be reduced by the amount of any claims made by the Company against the Sellers
under the representations, warranties and indemnities given by the Sellers in
the Acquisition Agreement.


US$5.0 million of the cash consideration will be paid into an escrow account so
as to be available to meet any claims made by the Company against the Sellers
under the representations, warranties and indemnities given by the Sellers in
the Acquisition Agreement.


Snorkel is a worldwide supplier of high quality industrial aerial equipment
including self-propelled booms, articulated and telescopic booms, aerial lifts
and self-propelled scissorlifts. The products are designed for use on a wide
range of surfaces and are supported by service, parts and training teams.


The Directors believe that the geographic fit between Snorkel and the Company to
be complimentary. Snorkel has a significant sales presence in North America,
Australia and New Zealand, whereas the Company's subsidiary, UpRight, has a
distribution network concentrated in Western and Eastern Europe, Russia and the
Baltics, the Middle East and the Asia-Pacific region. In summary, the Directors
believe that the Enlarged Group will have a strong distribution and sales
presence in North and South America, Australasia, Europe, the Middle East and
Asia-Pacific region and will have manufacturing capabilities in Europe, the USA
and Australasia. The Directors expect the Enlarged Group to benefit from global
supply chain efficiencies.


In addition, the Directors believe Snorkel's product range, which is focussed on
medium to large articulated and telescopic booms, to be an excellent
complementary fit with the Company's existing UpRight product suite, which has a
particularly strong small to medium sized lift offering. There is little product
overlap and the Directors expect the Enlarged Group to benefit from
cross-selling opportunities, with a comprehensive product portfolio enabling it
to meet customers' requirements.


For the year ended 31 December 2006, Snorkel had turnover of US$131.49 million
(£65.75 million) and achieved profit before tax of US$9.65 million (£4.83
million); net assets at 31 December 2006 were US$17.59 million (£8.80 million).
The Directors expect the Acquisition to be marginally earnings enhancing for the
Company in the financial year ending 31 December 2007 and significantly
enhancing thereafter.


Completion of the Acquisition is subject to a number of conditions, including
inter alia: the passing of a special resolution at the Extraordinary General
Meeting; completion of the Placing in accordance with the terms of the Placing
Agreement and Admission. In addition, the Company has reserved the right to
terminate the Acquisition in the event that there is a material breach of
warranty or condition before Admission. The Acquisition is also conditional on
clearances being obtained from, or any waiting period having expired without
challenge by, the United States antitrust enforcement agencies under the United
States Hart-Scott-Rodino Improvements Act of 1976. The principal agreement for
the Acquisition is governed by the laws of the State of Kansas.


Smith Electric Vehicles USA


The higher function zero emission vehicles produced by Smith Electric Vehicles
are receiving significant interest from major fleet operators based in North
America. Some of the Placing proceeds will be used to provide working capital to
establish manufacturing capabilities in the USA for Smith Electric Vehicles'
product portfolio and the Directors expect the launch of a US version of the
Smith Edison van and the Smith Newton truck in early 2008. The Directors believe
that the US market represents a significant opportunity for Smith Electric
Vehicles and one that requires investment in assembly facilities as well as
wider infrastructure to support vehicles in the field.


The Directors intend to leverage Tanfield's existing UpRight distribution
network in Europe, the Middle East and Asia-Pacific, along with the existing
Snorkel support infrastructure in Australasia and the USA, to provide global
service and maintenance for Smith products.


The Placing


The Placing will raise £115million (before expenses) for the Company. The
Placing is subject to the terms of the Placing Agreement between Cenkos
Securities, the Company and the Directors which contains, inter alia, warranties
and indemnities in favour of Cenkos Securities in relation to the Group and any
information made available to investors relating to the Placing.

The shares issued under the Placing will, when issued, rank pari passu in all
respects with the existing Ordinary Shares, including the rights to all
dividends and other distributions declared, made or paid following Admission.
Application will be made for the Placing Shares to be admitted to AIM.

Following strong appetite from institutional investors for the Placing, Roy
Stanley, Darren Kell and Brendan Campbell have, conditional upon completion of
the Acquisition, agreed to exercise options over 3,500,000, 2,972,000 and
300,000 Ordinary Shares (the 'Option Shares') respectively and to sell
8,500,000, 2,972,000 and 300,000 Ordinary Shares respectively at the Placing
Price. Following these sales, Roy Stanley, and Brendan Campbell will hold
19,649,292 and 6,119 Ordinary Shares respectively, representing 6.71 per cent.
and 0.002 per cent. of the Company's issued share capital as enlarged by the
Placing. In addition, following the sales, Roy Stanley, Darren Kell and Brendan
Campbell will hold options over 4,500,000, 6,556,671 and 1,950,000 Ordinary
Shares respectively with Darren Kell holding a further option to acquire
3,052,170 Ordinary Shares currently held by Roy Stanley.


Current trading and prospects


Smith Electric Vehicles continues to make good progress with major fleet
operators for its higher function commercial electric vehicles and recently won
its first contract from the Royal Mail, which has ordered both the Edison and
Newton higher function delivery vehicles, for trials. The vehicles will be
deployed in parcel and post distribution operations in London.


In line with a growing order book and increased interest in both Newton and
Edison, Tanfield is installing extra electric vehicle production capacity at
Vigo Centre, its 250,000sq ft assembly facility in Tyne & Wear, UK.


Tanfield's Powered Access division, led by UpRight Powered Access, continues to
demonstrate significant growth. The re-launch of the AB46 articulated boom lift
was well received at two major construction equipment exhibitions; international
show Bauma and UK exhibition SED 2007 and the Company has received orders for
over two hundred AB46 machines to date.


Installation of the third crane line at Vigo Centre is nearing completion and
will further increase production output, which presently stands at an average
rate of over 130 machines per week.


UpRight is making strong progress in the USA. During May 2007, the facility in
Fresno, California built 150 machines, well in excess of its target of 20 units
per week. UpRight has also won an order from a major US end user for 80
machines, to the value of US$800,000 (£400,000).


The proposed Acquisition will, the Directors believe, bring significant benefits
to the Group and the Directors continue to view the future with confidence.


Extraordinary General Meeting


In order that the Company is able to implement the issue of the Placing Shares
it will be necessary for the Company to increase its authorised share capital,
authorise the Directors to allot relevant securities under section 80 of the
Companies Act 1985 and dis-apply statutory pre-emption rights which arise under
the provisions of section 89 of that Act and a resolution to this effect will be
proposed in the circular containing the notice of Extraordinary General Meeting
to be posted to shareholders today.

If the resolution to be proposed at the Extraordinary General Meeting is passed,
following Admission and admission of the Option Shares, the Company's authorised
and issued share capital will be 500,000,000 shares and 370,286,089 shares
respectively.



Notes to editors

The Tanfield Group Plc is the world's leading developer and manufacturer of
road-going commercial electric vehicles and aerial work platforms. Tanfield is
headquartered in Newcastle with operations in the USA and Japan. It has two main
divisions:


Smith Electric Vehicles, was founded in 1920 and acquired by Tanfield in October
2004. Since its acquisition, Smith is developing into a world leader in new
technology electric vans and trucks with greatly enhanced performance, speed and
range capabilities. This makes them attractive for all fleet operators in large
towns, cities and closed industrial environment. For the first time, these fleet
operators have an economically viable, zero emission alternatives to using
diesel vans and trucks. Smith has an unrivalled UK-wide service and support
network, which already maintains over 5,000 vehicles for major fleet operators.
This core element of the business is beginning to fulfil its potential in terms
of addressing the requirements of large urban fleet operators, who want to
reduce their operational costs and more importantly, greatly reduce their carbon
footprint. Smith's airport offering is complemented by two specialist airport
vehicle sub-divisions; Jumbotugs and Norquip.

www.smithelectricvehicles.com


UpRight Powered Access, is firmly established as the UK's biggest manufacturer
of self-propelled aerial work platforms (such as 'cherry-pickers', 'scissor
lifts', 'trailer mounts', etc) and UpRight is globally one of the industry's
strongest aerial lift brands in what is a $7bn market. UpRight has assembly
facilities in the UK and USA, plus a wholly-owned subsidiary in Japan. Products
are sold through a strong global network of over 150 independent, full-service
distributors across Europe, North America, Middle East and Asia-Pacific regions.
Tanfield has been successful in extending the UpRight product range and
achieving significant increases in average weekly order intake, boosted in part
by working at height regulations.

www.upright.com

Cenkos Securities ('Cenkos'), which is authorised and regulated by the UK
Financial Services Authority, is acting for  Tanfield and no one else in
connection with the subject matter of this announcement and will not be
responsible to  anyone other than Tanfield for providing the protections
afforded to clients of Cenkos or for providing advice in  relation to the
subject matter of this announcement..


St Helen's Capital plc ('St Helen's'), which is authorised and regulated by the
UK Financial Services Authority, is acting for Tanfield and no one else in
connection with the subject matter of this announcement and will not be
responsible to anyone other than Tanfield for providing the protections afforded
to clients of St Helen's or for providing advice in relation to the subject
matter of this announcement..


This announcement does not constitute an offer to sell or the solicitation of an
offer to acquire ordinary shares in the share capital of Tanfield ('Shares').


The information contained in this announcement is not for release, publication
or distribution to persons in the United States, Australia, France, Canada,
Japan, New Zealand or the Republic of South Africa. This announcement is not an
offer of securities for sale into the United States. The Shares have not been
and will not be registered under the US Securities Act of 1933, as amended, and
may not be offered or sold, directly or indirectly, in the United States absent
registration or an exemption from registration. The Shares have not been and
will not be registered with any regulatory authority of any state within the
United States. There will be no public offer of securities in the United States.


Certain statements in this announcement are forward-looking statements. These
forward-looking statements speak only as at the date of this announcement. Such
statements are based on current expectations and beliefs and, by their nature,
are subject to a number of known and unknown risks and uncertainties that could
cause actual results and performance to differ materially from any expected
future results or performance expressed or implied by the forward-looking
statement. There are several factors which could cause actual results to differ
materially from those expressed or implied in the forward-looking statements.
These factors include Tanfield's ability to successfully combine the businesses
of Tanfield and Snorkel and to realise expected synergies from that combination,
changes in global, political, economic, business, competitive, market or
regulatory forces, future exchange and interest rates, changes in tax rates and
future business combinations or dispositions. The information and opinions
expressed in this announcement are subject to change without notice and none of
Tanfield, Cenkos or St Helen's assumes any responsibility or obligation to
update publicly or review any of the forward-looking statements contained
herein, regardless of whether those statements are affected by the results of
new information, future events or otherwise.


No statement in this announcement is intended to be a profit forecast and no
statement in this announcement should be interpreted to mean that Earnings per
Share for the current or future financial years would necessarily match or
exceed the historical published Earnings per Share.






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