PHD Proactis Holdings Plc

RNS No 2603w
PETERHEAD GROUP PLC
28th August 1998


PETERHEAD GROUP PLC: PROPOSED DISPOSAL

The board of Peterhead Group PLC ("Peterhead" or the "Company") announces that
it has entered into a conditional agreement to dispose of certain businesses
and assets of PCCL which are operated at or from the Peterhead and Aberdeen
depots of PCCL for a total cash consideration of #12.6 million (subject to
adjustment as described below).

The Disposal Businesses comprise the business of hiring and operating of
cranes from the Aberdeen and Peterhead depots of PCCL and the business carried
on by PCCL throughout the United Kingdom of the transportation of heavy or
abnormal loads by road.

The Disposal Businesses are being sold to Protaras, a company in which Roger
Taylor, a former Director of the Company (and in which he retains an
interest), will at completion of the Disposal have a majority interest. From
the aggregate consideration of #12.6 million, certain liabilities relating to
the Disposal Businesses will be discharged, and the net cash proceeds of the
Disposal to be received by PCCL, subject to adjustments as described below,
will be approximately #2.6 million.

Reasons for the Disposal

The Board decided that a reduction in the size of the crane fleet by means of
a disposal represented the best opportunity to realise additional cash for the
Group and to reduce debt. A sale of the Disposal Businesses would serve to
reduce the capital requirements of the Company and would generate sufficient
cash to alleviate some of the pressures on its working capital requirements.

Details of the Disposal and Application of the Disposal Proceeds

On 27 August 1998 the Company entered into a contract for the sale of the
Disposal Business to Protaras. The aggregate cash consideration for the
Disposal Businesses is #12.6 million, payable on completion. The aggregate
consideration of #12.6 million will be adjusted following verification of the
assets being disposed of by a physical audit of the assets.  There is no
guaranteed minimum amount receivable by the Company. Of the aggregate proceeds
received, approximately #8.2 million will be utilised to settle the
outstanding leasing and hire purchase liabilities on the cranes, tractors and
trailers which are to be sold, and approximately #1.8 million will be utilised
to repay the outstanding balance of an unsecured loan of #2.25 million made by
Roger Taylor to PCCL in April 1997.

The effect of the Disposal will be to realise a net cash balance of
approximately #2.6 million, which may vary depending on the amount of any
adjustment referred to above and the value added tax treatment of the
Disposal, and this will be used to provide working capital for the Company
until a restructuring of the Company's finances is completed.

As Roger Taylor was a director of PCCL, RCPS and the Company and will,
following completion of the Disposal, hold a majority interest in Protaras,
the Disposal is classified as a related party transaction.  This fact,
together with the size of the transaction, means the Disposal is conditional
upon shareholder approval. 

The assets to be sold comprise cranes, a transport fleet of trailers, a
freehold property, certain debtors and goodwill. The crane assets and the
trailers have been independently valued by Chartered Surveyors Weatherall,
Green and Smith at #10,455,000 and #589,000 respectively. The freehold
property being disposed of has been independently valued by Chartered
Surveyors Gooch Webster at #470,000.

The turnover of the Disposal Businesses was #5.8 million in the year ended 31
January 1998.

Circular and Extraordinary General Meeting

It is expected that a circular giving details of, inter alia, the Disposal and
the convening of an Extraordinary General Meeting of the Company will be sent
to Ordinary Shareholders shortly.
 
Availability of Announcement

Copies of this announcement will be available in the United Kingdom from the
offices of Henderson Crosthwaite Corporate Finance, 32 St Mary at Hill, London
EC3P 3AJ  for a period of 14 days following the date of publication.

Enquiries:

Bill Baugh              Peterhead Group plc                 0113243 3065
Chief Executive

Peter O'Carroll       Bloxham Stockbrokers                  00 353 18291888


Nigel Tose              Henderson Crosthwaite               0171 6239333
Director               Corporate Finance

Definitions

The following definitions apply throughout this announcement unless the
context requires otherwise:

"Company" Peterhead Group PLC Directors" or "Board" the directors of the
Company as at the date of this document "Disposal" the proposed sale of
the Disposal Business of PCCL  "Disposal Businesses" the business of
leasing or operating cranes at or from the Aberdeen and Peterhead depots of PCCL
and the business carried out by PCCL throughout the United Kingdom of the
transportation of heavy or abnormal loads by road and, where the context
requires, the Aberdeen and Peterhead depots. "Group" the Company and its
subsidiaries "Ordinary Shareholders" Holders of ordinary shares of IR10p
each on the capital of the Company "PCCL" Peterhead Crane Company Limited
"Protaras" Protaras Limited, the proposed purchaser of the Disposal
Businesses "RCPS" Refinery Crane Plant Services (Killingholme) Limited.


END

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