Disposal/Change of Name

CARCLO ENGINEERING GROUP PLC
30 September 1999

          Disposal of Lee Steel Strip for £20.6m and
                 proposal to change the name.
 
                          HIGHLIGHTS
 
* Major  change  in strategic emphasis at Carclo with the
  sale of Lee Steel Strip to Avesta Sheffield AB for proceeds of
  £20.6 m, in cash.
 
* Disposal   is  conditional  upon  clearance   from   the
  competition authorities.
 
* Group  now focused upon Technical Plastics and Specialist
  Wire.
 
* Proposal to be put before shareholders to change the name
  of the company from 'Carclo Engineering Group PLC' to 'Carclo
  plc'.
 
Commenting  on  these developments, George Kennedy,  Chairman,
said:-
 
'The disposal of Lee Steel Strip is a positive strategic step,
not only for Carclo, but also for Lee Steel Strip itself.  Lee
Steel  Strip,  despite its unique position  in  the  precision
steel  strip  industry, was no longer  a  strategic  fit  with
Carclo,  the large part of which is now focused upon technical
plastics.
 
The proposal to change the name of the company to 'Carclo plc'
reflects  the  change  in  emphasis of  the  group  away  from
traditional  engineering  activities  towards  higher   growth
applications   in   the   automotive,   optical-medical    and
teletronics markets'.
 
Contact:

Ian Williamson, Group Chief Executive            0114 256 2162
 
Simon Gorringe, Robert Fleming & Co. Limited     0171 638 5858
 
Richard Hews, Ludgate Communications             0171 253 2252
 
                               
                 CARCLO ENGINEERING GROUP PLC
                          ('CARCLO')
                               
                            
1. Disposal of Lee Steel Strip
 
The  Board  of Carclo announces that it has reached  agreement
with   Avesta  Sheffield  Holdings  Limited,  a  wholly  owned
subsidiary  of Avesta Sheffield AB, to sell the entire  issued
share  capital  of  Lee  Steel  Strip  Limited  ('LSS').   The
agreement  is conditional upon the parties receiving clearance
from the competition authorities.
 
(a) Proceeds
 
The total proceeds before costs arising from this disposal are
expected   to   be   approximately  £20.6m.   This   comprises
consideration for the equity of £17.9m and an amount of  £2.7m
for   surplus  land  and  buildings  adjacent  to  LSS.    The
consideration will be payable in cash at completion.
 
(b) The business of Lee Steel Strip
 
LSS joined the Carclo group in 1993 as part of the merger with
Arthur  Lee  &  Sons plc, and since then it has comprised  the
predominant  part of Carclo's Precision Engineering  division.
Its  principal  activity is the manufacture of precision  cold
rolled  steel  strip.  The business is located  in  Sheffield,
England.
 
In  the year to 31 March 1999 the business had sales of £27.4m
and  earned profit before taxation of £979,000.  The operating
profit   before  interest  and  taxation  in  that  year   was
£1,285,000 and the net assets of LSS at that date were £11.2m.
In  addition  the book value of the surplus land at  31  March
1999 was £2.4m.
 
(c) Impact of the disposal on Carclo
 
The  proceeds  from  the disposal of LSS  and  the  associated
property are in excess of the tangible net assets being  sold.
However, when Carclo merged with Arthur Lee & Sons plc in 1993
goodwill  arising  on  acquisition, amounting  to  £9.6m,  was
allocated to LSS.  This goodwill which was previously  written
off  will,  in accordance with FRS2, be realised  through  the
profit  and  loss account in the year ending  31  March  2000,
giving  rise to an exceptional item in this regard  of  £9.6m.
This  has  no impact on the cash position of the  group.   The
exceptional  profit  on  disposal,  after  costs  but   before
taxation, is forecast to be approximately £5.8m.
 
The  overall  impact on earnings per share before  exceptional
items of this disposal is expected to be modest, although  the
cyclical  nature of earnings derived from this business  means
that  the  underlying quality and sustainability  of  Carclo's
earnings in future years will be enhanced.
 
The  proceeds  arising from this transaction  will  amount  to
approximately  £19.6m  after allowing  for  taxation  and  the
associated costs of disposal and will be used to reduce  group
indebtedness.  On a pro-forma basis therefore the group's  net
debt  at 31 March 1999, after allowing for the acquisition  of
CTP  Carrera,  Inc.,  in  April 1999 and  adjusting  for  this
disposal, would have been £24.9m.  The group's cash and unused
bank   facilities   following   this   transaction   will   be
approximately £70.0m.
 
2. Proposed change of name
 
Carclo is now principally focused upon Technical Plastics  and
Specialist  Wire.  Technical plastics operations  serving  the
growing automotive, optical-medical and teletronics market now
comprise  70  per cent. of group turnover.  To  reinforce  and
support  the brand identity of these operations, the Board  is
recommending that the group name be shortened to 'Carclo plc'.
A  circular  convening  an Extraordinary  General  Meeting  of
Carclo  will  be despatched to shareholders in  the  next  few
days, setting out the details of and reasons for this proposal
and  including  a  special resolution to  be  put  before  the
shareholders at the meeting.
 
Contact:

Ian Williamson, Group Chief Executive            0114 256 2162
 
Simon Gorringe, Robert Fleming & Co. Limited     0171 638 5858
 
Richard Hews, Ludgate Communications             0171 253 2252