Melrose PLC Announces Agreement to Acquire Elster Group SE

London (ots/PRNewswire) -

Elster Shareholders to be offered $20.50 per Elster ADS in
cash in a U.S.

tender offer

Today the board of Melrose PLC ("Melrose" or "the Company")
announces it has reached agreement with the administrative board of
Elster Group SE ("Elster") on the terms of a recommended proposal for
Melrose to acquire Elster for $20.50 per Elster American Depositary
Share ("ADS") (or $82 per Elster ordinary share) by means of an
all-cash U.S. tender offer (the "Tender Offer") for the entire issued
and outstanding share capital of Elster ("the Acquisition"). The
Acquisition represents a total equity value of approximately $2.3
billion in aggregate.

The offer price for each Elster ADS represents a premium of
approximately 48.6% to the price of an Elster ADS on 11 June 2012,
the last business day before press speculation that Rembrandt
Holdings S.A. ("Rembrandt") was considering a sale of its Elster
holding and approximately 44.3% to the average price of an Elster ADS
in the six month period ending on 11 June 2012. The administrative
board of Elster has unanimously approved the transaction and intends,
in its Schedule 14d-9 filing with the U.S. Securities and Exchange
Commission, to recommend that holders of Elster ADSs and Elster
ordinary shares tender their Elster ADSs and Elster ordinary shares
into the Tender Offer.

Melrose has received irrevocable undertakings from Rembrandt and
its affiliates, Elster's majority shareholders, and from certain
members of the administrative board of Elster and a managing director
of Elster to tender into the Tender Offer, subject to specified
conditions, all Elster ADSs and Elster ordinary shares that they
beneficially own (amounting in aggregate to approximately 64.19% of
the total share capital of Elster as of the date of this
announcement).

Melrose's Chief Executive, Simon Peckham said:

"We believe that Elster is an excellent fit with the Melrose
acquisition criteria. Elster is a high quality business with strong
end markets and the potential for significant development and
improvement under Melrose management."

Melrose's Chairman, Christopher Miller added:

"We are pleased to reach agreement with the Elster administrative
board, who are recommending our offer. Since flotation in 2003 we
have created over GBP1 billion of shareholder value and we believe
that this acquisition gives us further opportunity to continue our
track record of creating significant value for our shareholders."

The Tender Offer is expected to commence on or about 6 July 2012.
In addition to other customary closing conditions, the completion of
the Tender Offer will be conditional upon:

- Melrose's shareholders approving Melrose's acquisition of Elster for
purposes of the United Kingdom Listing Authority listing rules and approving Melrose's
rights issue of Melrose ordinary shares in the United Kingdom and the admission of
such rights issue to trading, nil paid, on the London Stock Exchange;
- receipt of anti-trust clearances from the relevant regulatory authorities in
the EU, U.S., Ukraine and Russia; and
- there having been validly tendered (and not properly withdrawn) prior to the
expiration date of the Tender Offer such number of Elster ADSs and Elster ordinary
shares that represent at least 75% of the Elster total share capital as of the Tender
Offer expiration date.

The conditions relating to the approval of the Acquisition by
Melrose shareholders, clearance by the EU and U.S. regulatory
authorities and, the admission of the Melrose rights issue to
trading, nil paid, on the London Stock Exchange and the Investment
Agreement not having been terminated will not be waived in whole or
in part and the other conditions may be waived by Melrose.

In order to implement the Acquisition, Melrose and Elster have
entered into an Investment Agreement in which Elster has given
certain undertakings to cooperate with Melrose and Melrose has given
certain undertakings to Elster concerning, among other things, their
conduct in connection with the Acquisition and Melrose's intentions
in connection with the continuation of the Elster Group's business
after the Acquisition.

Also pursuant to the Investment Agreement, Melrose has the right
to waive the 75% minimum condition. As a result of the ability to
waive this minimum acceptance condition together with having
received, in particular, the irrevocable undertaking from Rembrandt
and its affiliates to tender into the Tender Offer all Elster ADSs
and Elster ordinary shares that they beneficially own, Melrose
believes that the Tender Offer will be successful. The Tender Offer
is expected to close in August 2012, and if the Tender Offer is
successful, Melrose will have the ability to take steps to pursue a
voluntary delisting of Elster ADSs from the NYSE.

About Elster

Elster is a world leading engineering company and one of the
world's largest providers of gas, electricity and water meters, gas
utilisation products and related communications, networking and
software solutions. Elster is a European public limited liability
company (Societas Europaea, or SE) with its registered seat in Essen,
Germany. Elster ADSs representing all of Elster's ordinary share
capital are traded on the NYSE and on the OTC (over the counter)
market (Freiverkehr) on the stock exchanges of Berlin, Frankfurt am
Main, Stuttgart and the Tradegate Exchange (one Elster ADS represents
one-fourth of one Elster Share).

About Melrose

Melrose is a public limited company registered in England and
Wales which has a track record of acquiring businesses and making the
necessary changes to maximise the value inherent in those businesses
to the benefit of shareholders; as such, Melrose typically raises
large amounts of equity to fund acquisitions and return cash to
shareholders upon realisation of their investments. Melrose currently
operates in three segments: Energy, Lifting and Other Industrials.
The Energy segment incorporates the Brush Turbogenerators, Brush
Transformers, Marelli and Hawker Siddeley Switchgear business units,
all specialist suppliers of energy industrial products to the global
market. The Lifting segment includes the businesses of Bridon and
Crosby, serving oil and gas production, mining, petrochemical,
alternative energy and general construction markets. Other
Industrials incorporates all other operating businesses.

Forward Looking Statements

This announcement contains (or may contain) certain
forward-looking statements with respect to certain of Melrose's
current expectations and projections about future events. These
statements, which sometimes use words such as "anticipate",
"believe", "intend", "estimate", "expect", "will", "shall", "may",
"aim", "predict", "should", "continue" and words of similar meaning
and/or other similar expressions that are predictions of or indicate
future events and/or future trends, reflect the directors' beliefs
and expectations at the date of this announcement and involve a
number of risks, uncertainties and assumptions 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.

Statements contained in this announcement regarding past trends
or activities should not be taken as a representation that such
trends or activities will continue in the future. The information
contained in this announcement is subject to change without notice
and, except as required by applicable law, neither Melrose nor any of
its affiliates assumes any responsibility or obligation to update
publicly or review any of the forward-looking statements contained
herein. You should not place undue reliance on forward-looking
statements, which speak only as of the date of this announcement.

Additional Information

This announcement is for informational purposes only and is not
an offer to buy or the solicitation of an offer to sell any Elster
Shares or Elster ADSs. The Tender Offer described herein has not yet
been commenced. On the commencement date of the Tender Offer, an
offer to purchase, letters of transmittal and related documents will
be filed with the Securities and Exchange Commission ("SEC"). The
solicitation of offers to buy Elster ADSs and Elster ordinary shares
will only be made pursuant to the offer to purchase, the letters of
transmittal and related documents. Elster securityholders are
strongly advised to read both the Tender Offer statement and the
solicitation/recommendation statement that will be filed by Elster
regarding the Tender Offer when they become available as they will
contain important information. Elster securityholders may obtain free
copies of these statements (when available) and other documents filed
with respect to the Tender Offer at the SEC's website at
http://www.sec.gov. In addition, copies of the Tender Offer statement
and related materials (when available) may be obtained for free by
directing such requests to the information agent for the Tender
Offer. The solicitation/recommendation statement and related
documents (when available) may be obtained by directing such requests
to Elster.

This announcement is for information purposes only and shall not
constitute an offer to buy, sell, issue or subscribe for, or the
solicitation of an offer to buy, sell, issue, or subscribe for, any
securities in Melrose Plc or any other entity. No securities of
Melrose PLC have been or will be registered under the U.S. Securities
Act of 1933 and may not be offered or sold in the United States
absent registration or an exemption from registration thereunder..

Enquiries:
M: Communications (PR Adviser to Melrose)
+44 (0) 20 7920 2330

ots Originaltext: Melrose PLC
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