AGM Statement

Stanelco PLC
03 June 2004

                                  Stanelco plc

                                      AGM
                   Completion of Acquisition of Aquasol Ltd.
                       RF Technology Application Success

Further to the announcement of 6th May 2004, Stanelco plc, the RF (radio
frequency) applications group, is pleased to announce that it has completed the
acquisition of 100% of the issued share capital of Aquasol Limited (Aquasol) for
a maximum consideration of £3.1 million. The majority of which is subject to the
achievement of performance criteria related to the financial contribution made
to the Stanelco Group. An initial payment of £0.5m (10,000,000 new Ordinary 0.1p
shares) is now due. Accordingly 10,000,000 new ordinary shares of 0.1p each have
today been allotted to the vendors of Aquasol. The remaining sum of up to £2.6
million will be payable over 1-3 years in new issued shares or in cash at
Stanelco's option. The acquisition is not subject to shareholders' approval.

Application will be made for the 10,000,000 new ordinary shares to be admitted
to the Official List of the UK Listing Authority and to trading on the London
Stock Exchange's Market for listed securities. Dealings are expected to commence
on Thursday 10th June 2004.

Aquasol is the world leader in water-soluble packaging innovation, products and
processes. The intellectual property based company has over 18 years experience
in water-soluble packaging technology and its team has been named inventors in
44 international patent applications. Aquasol are the creators of Unilever's
Persil capsule, Reckitt Benckiser's gelcaps including Electrasol, Woolite and
Calgonit brands, Schering-Plough Animal Health's Coopers Ectoforce Sheep Dip,
and numerous others in the pipeline. Aquasol has dedicated development
facilities near Chelmsford. Aquasol currently has a turnover of around £400k of
which a significant and growing portion is in the form of royalties. Royalties
and profit sharing that would have been due to Aquasol under the collaborative
agreement between Stanelco and Aquasol, announced in November, will now remain
within the Group. Aquasol's last audited accounts at 31 August 2003 showed a
turnover of £476k, net assets of £220k and was at breakeven at the pre tax
profit level.

Stanelco is also pleased to announce that it has successfully converted the
first commercial-scale thermoforming machine using its RF sealing technology.
This equipment is now being demonstrated to potential customers using polymer
films from Stanelco and other suppliers to make products filled with fluids or
powders. The RF sealing technology offers customers the prospect of
significantly improving product quality and reducing product cost. This
technology also enables the production of a new range of edible sachets products

Stanelco continues to find trading difficult in its traditional business of high
technology furnaces for optical fibre manufacture due to the telecommunications
market downturn. Steps are being taken to further reduce costs in this area.

The Group is also incurring significant costs in the preparation of its case
against Bioprogress Technology Limited concerning the determination of patent
ownership. Stanelco considers that the BioProgress claims are entirely without
merit and is strongly resisting them. Stanelco will take all actions necessary
to protect its ownership of all patents and thereby safeguard shareholder value.
This case is due to be heard in the High Court commencing on 8 July this year
with a determination expected in September.

The Group continues to invest heavily in the development, patenting and
commercialisation of its RF technology for applications including ingestible
capsules, food sachets, detergent capsules and packaging materials. The Group is
currently negotiating with 15 major corporations including machinery
manufacturers, packaging suppliers and end users regarding its new technologies.
The majority of anticipated revenues are unaffected by the court case with
BioProgress. During this transition phase, whilst these negotiations and the
court action remain ongoing and we continue to invest in development, the Group
continued to be loss-making for the half year to 30 April 2004. However the
£1.5m injection of funds at the Rights Issue means that the Group has cash
reserves and no net borrowings.

Commenting on these events at the AGM, Ian Balchin, Chief Executive of Stanelco,
said 'We are delighted to welcome Aquasol into the Stanelco Group of companies.
We believe that our combined technologies and customer relationships will offer
an exciting opportunity for customers to become more eco-friendly whilst at the
same time significantly improving operating margins.'


ENDS-
For further information. Please contact:
Ian Balchin, Chief Executive
Stanelco plc                         Tel: [phone]
Jonathon Brill
Financial Dynamics                   Tel: [phone]

Notes to Editors:

Stanelco was founded in 1953 and is a world leader in the development of radio
frequency technologies for processing polymers of edible and packaging
applications and the design and manufacture of optical fibre technology,
induction heating and dielectric welding equipment. The Group's current core
business is the manufacture of optical fibre using Radio Frequency (RF)
technology. Stanelco has been applying its technology to other markets and is
currently developing detergent capsules, foamed starch trays, edible sachets and
waste packing.

Aquasol is an intellectual property based company and a leader in the field of
developing water-soluble packaging and delivery systems. Aquasol's technology
and future direction have a strong strategic fit with those of Stanelco.



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