Re Contract

Balfour Beatty PLC
23 August 2006


23 August 2006



           BALFOUR BEATTY AWARDED £180 MILLION CONSTRUCTION CONTRACT
           =========================================================
                 AS NEW VICTORIA AND STOBHILL HOSPITALS PROJECT
                 ===============================================
                            REACHES FINANCIAL CLOSE
                            ========================

Balfour Beatty the international engineering, construction and services group
announces today that its subsidiary Balfour Beatty Construction (BBCL), through
an alliance with the specialist developer Canmore Partnership Ltd, has secured
financial close on the new Victoria & Stobhill Hospitals project in Glasgow.

BBCL will be responsible for the £180m contract to design and construct the new
hospitals which will be built in close proximity to existing healthcare 
facilities: one to be located on the Stobhill Hospital Campus in the north of
Glasgow and the other, adjacent to the Victoria Infirmary on the south side of
the city.

Commenting today, Balfour Beatty's Chief Executive Ian Tyler said:

'Balfour Beatty is delighted to have reached this landmark stage in partnership
with both Canmore and NHS Greater Glasgow & Clyde and now looks forward to
delivering two brand new hospitals that will significantly enhance acute
hospital care throughout Glasgow.

'We have a long tradition of delivering successful healthcare projects in
Glasgow and this is the third healthcare project we have secured in partnership
with Canmore.'

The facilities, which are scheduled for completion in Spring 2009 form Phase 1
of NHS Greater Glasgow & Clyde's hospital modernisation programme which will
radically improve healthcare facilities across the city. Each hospital will be
equipped with day-care operating theatres, imaging treatment facilities,
Endoscopy and Dialysis units together with MRI equipment, which will be at the
forefront of diagnostic treatment provision.

The PFI concession which is for 33 years will be operated by a special purpose
company owned by Canmore Partnership Ltd, Barclays Private Equity, UME
Investments and The PFI Infrastructure Company.

In Glasgow, Balfour Beatty is currently constructing the new mental health
secure care centre on the Stobhill site (Rowanbank Clinic) and is also
contributing to the city's position at the forefront of cancer research through
the construction of the new Beatson Institute facility at Garscube.


                                      ENDS

Enquiries to:-

Tim Sharp, Director of Corporate Communications
Tel: [phone]
www.balfour.beatty.com

Notes to Editors

 1. Balfour Beatty Construction, has annual revenues of over £600 million and is
    a leading specialist in major public building works. Amongst its current
    project portfolio is the £125 million Blackburn Hospital, the £553 million
    Birmingham Hospital and schools schemes in Stoke, Rotherham, Bassetlaw,
    Birmingham and North Lanarkshire with a combined capital value of over £500
    million.

 2. Balfour Beatty is the PFI concession holder for five major acute hospitals,
    namely, the University Hospital, North Durham, the Edinburgh Royal
    Infirmary, University College London Hospital, Queens Park Hospital
    Blackburn, and Birmingham New Hospital. It is also preferred bidder for the
    schemes at Pinderfields and Pontefract in Yorkshire and the Northern Batch
    project in Manchester.

3.  In the Glasgow schools sector, BBCL is currently carrying out the design and
    construction contracts for new primary schools for Glasgow City Council.

4.  In support of the private sector in Glasgow BBCL are prominent in the city's
    International Financial Services District where we are on our third 
    consecutive contract for developers Wilson Bowden, the design and 
    construction of a new office block at Atlantic Quay whilst at the same time 
    work progresses on the redevelopment of 110 St Vincent Street for the 
    Scarborough Property Group, a landmark heritage building.

5.  Balfour Beatty is a world class engineering, construction service group 
    which works in partnership with a sophisticated customer who require the 
    highest levels of quality, safety and technical expertise and for whom 
    organisation, quality, efficiency and reliability are critical.



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