AAP Alpha Airports

RNS No 3548r
ALPHA AIRPORTS GROUP PLC
13 July 1999

                                       
                  ALPHA Airports Group Plc ("ALPHA Airports")
                                       
                 Proposed disposal of DynAir (the "Disposal")
                                       
*    Proposed disposal of ALPHA Airports' ground handling business, DynAir, to
     SAir Group for a total cash consideration of US$155.0 million (#99.5
     million)

*    Proceeds will be used to reduce Group borrowings and allow greater
     financial resources to be directed to development opportunities in
     Airline Catering and Retail in the UK and Europe

*    The Disposal is subject to shareholder approval at an Extraordinary
     General Meeting which has been convened for Thursday, 29 July 1999

*    A circular containing details of the Disposal and notice of the
     Extraordinary General Meeting is being sent to shareholders today

Commenting on the transaction, Kevin Abbott, ALPHA Airports' Chief Executive,
said:

"We are pleased with the terms of the proposed sale of DynAir. This disposal
will now enable the ALPHA Airports Group  to focus its management and
financial resources on the further development of its airline catering and
retail businesses."

13 July 1999

Press enquiries:

ALPHA Airports Group Plc
Kevin Abbott, Chief Executive                             Today: 0171 457 2345
Stuart Siddall, Finance Director                     Thereafter: 0181 580 3200

Schroders (New York)
Mark Francis                                                  001 212 492 6000
Matt Lew

Schroders (London)
David Wormsley                                                   0171 658 6000
Nick Reid
Richard Butland

Gavin Anderson & Company
Marc Popiolek                                                    0171 457 2345
Laura Hickman      

J. Henry Schroder & Co. Limited ("Schroders"), which is regulated by the
Securities and Futures Authority Limited, is acting for ALPHA Airports and for
no one else in relation to the Disposal and will not be responsible to anyone
other than ALPHA Airports for providing the protections afforded to its
customers or for providing advice in relation to the Disposal.


                 ALPHA Airports Group Plc ("ALPHA Airports")                  
                                      
                Proposed disposal of DynAir (the "Disposal")

1.   Introduction

ALPHA Airports has today agreed to dispose of DynAir, its ground handling
business, to the SAir Group for a total cash consideration of US$155.0
million (#99.5 million).  SAir Group is the holding company of the Swiss
based airline services group which owns Swissair and the Swissport ground
handling operations.  In view of its size, the Disposal is conditional,
inter alia, upon the approval of ALPHA Airports' shareholders which is to be
sought at an Extraordinary General Meeting to be held on Thursday, 29 July
1999.  A circular containing details of the Disposal will be posted to
shareholders today.

2.   Background to and reasons for the Disposal

Last year, the ALPHA Airports Board conducted a strategic review that
examined the options for the development of the Group, including its ability
to fund development opportunities effectively.  The Board concluded that the
Group and its constituent businesses would benefit from a more focused
application of both management and financial resources, through a reduction
in the number of core divisions.

A significant element of the strategic rationale for ALPHA Airports'
ownership of DynAir has been the opportunity to leverage DynAir's expertise
and to expand the business into Europe, alongside ALPHA Airports' other
businesses.  Over recent years, the DynAir and Group management teams have
examined a number of European growth opportunities for DynAir.  In each
case, the Board determined that either the investment would not deliver
acceptable returns or that the Group did not have sufficient resources to
invest in the opportunity.  The Board believes that DynAir is likely to be
of greater value to a larger group that can, through investment, leverage
the business' considerable strengths.

The Board believes that a sale of DynAir will enable the Group to focus its
management and financial resources more effectively on the retained
businesses.

3.   Financial effects of the Disposal

The consideration receivable from the Disposal of US$155.0 million (#99.5
million) will be used to reduce Group borrowings.  In addition, ALPHA
Airports' total available borrowing facilities will reduce from #114.1
million to #57.2 million upon completion of the Disposal.

The Board expects the Disposal to dilute short-term earnings per share until
some of the proceeds can be reinvested to generate superior returns to those
simply available through repayment of outstanding debt and on cash deposits.
The Board believes this short-term dilution is acceptable given the benefits
of greater financial flexibility, improved focus and the growth
opportunities available to the remaining businesses.

For the ALPHA Airports Group, the profit on disposal after estimated
disposal costs of #5.5 million and net of goodwill of #58.0 million
previously written off is approximately #2.3 million, based upon pro forma
net assets as at 31 January 1999.  Estimated disposal costs of #5.5 million
includes a provision of #1.5 million for estimated environmental
liabilities.  The profit on disposal after estimated disposal costs but
before goodwill previously written off will be approximately #60.3 million.
The Directors are continuing to evaluate any additional potential
environmental liabilities that may arise from indemnities provided as part
of the Disposal.

4.   Information on DynAir

DynAir is a leading provider of ground handling services in the USA.  DynAir
was acquired by the Group in 1995 for US$122 million and has since been
expanded, predominantly in the USA, and now operates at 57 airports in the
USA, Italy and Russia.

Services provided fall into three broad categories:

*    General airport services, which includes management of reservations,
     overnight mail handling, ground support and equipment maintenance,       
     baggage handling, aircraft cleaning and de-icing, passenger ticketing,
     transportation services, parking management, line maintenance, security  
     and warehousing;
*    Fuelling, which includes aircraft re-fuelling, tank farm management and
     fuel distribution; and
*    Cargo handling, which includes the design and operation of air freight
     hubs, build-up and breakdown of cargo and mail, documentation preparation
     and customs clearance, and on and off loading of aircraft.

In the year ended 31 January 1999, DynAir generated operating profit of #9.6
million (US$16.0 million) on sales of #121.1 million (US$201.0 million). The
book value of the DynAir Group's assets was #33.7 million (US$55.3 million)
as at 31 January 1999, which included #7.0 million (US$11.5 million) of
cash.

5.   Principal terms of the Disposal

The Disposal comprises the sale of those companies which form ALPHA Airports
Group's ground handling services operations comprising principally ALPHA US
Holdings Inc and DynAir Services Inc and all its subsidiaries. The Disposal
is subject to the approval of shareholders which will be sought at the
Extraordinary General Meeting. Under the terms of the conditional agreement
setting out the terms of the Disposal, the Group will receive total
aggregate cash consideration of US$155.0 million (#99.5 million), payable in
full on completion. The consideration includes US$7.5 million (#4.8 million)
in respect of cash retained in DynAir. The consideration is subject to
adjustment to the extent that, on completion, net assets sold are higher or
lower than US$52.5 million (#33.7 million).

6.   Current trading and future prospects

Overall trading within the Group, including DynAir, since the start of the
current financial year has been in line with expectations.

On 30 June 1999, intra EU duty free and tax free allowances were abolished.
Whilst ALPHA Airports was disappointed that the EU decided to proceed with
the abolition, the Company is well placed to tackle the challenges of a
changing travel retail industry.

On 11 June 1999, the Board was pleased to announce the acquisition of the
British Airways in-flight catering facility at Gatwick for #14.0 million. As
part of the purchase agreement, British Airways and ALPHA Airports have
entered into a new 10 year service agreement for the continued supply of in-
flight catering and ancillary services at Gatwick and eight UK regional
airports.

In the ALPHA Airports Group's 1998/99 Annual Report it was indicated that a
restructuring provision of up to #2 million may be required in respect of
ALPHA Airport's Paris Orly kitchen on account of the loss of a major
customer later this year. As a result and in the absence of replacement
business, the full amount of #2 million will impact ALPHA Airports Group's
full year results.

The Board believes the prospects for Airline Catering are satisfactory. As
stated in the Group's 1998/99 Annual Report, Retail profits are expected to
be affected adversely by the abolition of intra EU duty free and tax free
allowances and the reduction of profits of #1.5 million on the expiry of the
Gatwick Management contract.  Overall, the ongoing Group's prospects for the
current financial year remain in line with the Board's expectations.

7.   Board Changes

On completion of the Disposal, Patrick Deasy, who is President of DynAir and
a director of ALPHA Airports, will transfer with DynAir. Patrick Deasy will
receive a bonus of US$250,000 to remain with the DynAir Group until 31
December 1999. On completion Patrick Deasy will therefore resign from the
ALPHA Airports Board and cease to be employed by the Group. Due to his
interest, by reason of his involvement in the Disposal, Patrick Deasy has
abstained from the recommendation to shareholders to approve the Disposal.
The Board wishes to record its thanks to Patrick Deasy for his service to
ALPHA Airports.


END

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