RNS No 8564k
ELECO PLC
7th January 1999

                          Eleco plc
                          ('Eleco')
                              
Change of Name, Proposed Asset Disposals and withdrawal from
                    Strawboard production
                              
Eleco announces that the change of name to Eleco plc from
Eleco Holdings plc, approved by shareholders at the Annual
General Meeting on 4 December 1998, has become effective.

Eleco also announces that its subsidiary, Stramit Limited
('Stramit') has entered into an agreement to sell its
strawboard production line to Karphos GmbH & Co. KG, a
member of the Germany based Bio Pack Group ('Bio Pack'), a
strawboard customer for several years.  The sale has been
agreed following a review of Stramit's operations by the
Board of Eleco, which concluded that Stramit should
concentrate its resources on further expanding its enlarged
panels business and withdraw from strawboard production in a
manner which would not prejudice the existing customer base.

During the last full financial year ended 30 June 1998,
Stramit's strawboard business accounted for #960,000 out of
Eleco Group sales of #27,895,000 and generated an operating
loss of #72,000 against the Group operating profit of
#1,324,000.

Under the terms of the agreement with Bio Pack, Stramit will
receive #503,000 in cash for the equipment being acquired by
Bio Pack, on the earlier of the commissioning of the plant
in Germany or 31 May 1999.  The net book value of the
equipment being sold was #299,000 at 30 June 1998.  Stramit
will also receive a total of #155,000 in cash for
refurbishment of the equipment, training, engineering
installation support and other services to be supplied to
Bio Pack during the hand over period.  In order to maintain
continuity of supply to other strawboard customers during
the transfer period, Stramit has also agreed to sell to Bio
Pack its residual stocks of finished strawboard products.

Following its withdrawal from strawboard production Stramit
will be able to concentrate its resources on its panels
business, which increased its sales by 71 per cent in the
last full financial year and where Stramit is now the
leading trade supplier to the partitioning and mobile
accommodation industries.

Eleco has also reached agreement, subject to contract, for
the sale of the ex-Davis International freehold property at
Haverhill for #470,000 payable in cash on completion.  The
net book value of the property at 30 June 1998 was #526,000.
The proceeds of the sale to Bio Pack and of the sale of the
property, after exchange of contracts, will be applied when
received in reducing bank borrowings.

John Ketteley, Executive Chairman, commented:

'Our decision to withdraw from the loss making strawboard
business will enable our Stramit subsidiary to concentrate
its resources on its panels business and, when received, the
agreed proceeds of sale of the strawboard line and the
property will enable Eleco to further reduce its gearing in
line with our stated objective.'

Enquiries:

John Ketteley, Executive Chairman               Tel: 01992 440 311
Eleco plc

David Dannhauser, Finance Director              Tel: 01992 440 311
Eleco plc

Issued by:

Tarquin Edwards                                 Tel: 0171 256 5756
Millham Communications


END


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