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LMI Int'l Utilities (LIU)

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Monday 29 September, 2003

LMI Int'l Utilities

Winding up and reconstruction of the Company


     LeggMason Investors International Utilities Trust plc (the 'Company')     

                 Winding up and reconstruction of the Company                  

The Board is pleased to announce the details of proposals for the winding up
and reconstruction of the Company. Under the Proposals, Shareholders will be
able to either exchange their investment in the Company for an investment in a
new investment company, Premier Utilities Trust plc ('PUT'), elect to receive
Cash Fund Shares or take cash in the liquidation of the Company. Overseas
Holders will receive cash in respect of their holdings unless they are able to
satisfy PUT or the Cash Fund that they can legally hold PUT Securities or Cash
Fund Shares (as appropriate).

The Proposals

Background to the Proposals and options available to Shareholders

The Articles currently provide for the termination of the Company in December
2003 unless prior to that time the Board is released from its obligation to
implement a voluntary winding up.

The Directors believe that some Shareholders may wish to continue their
investment through a successor vehicle rather than, in the case of Income
Shareholders and ZCP Shareholders, simply receiving their respective capital
entitlements in cash on a voluntary liquidation of the Company, or, in the case
of Ordinary Shareholders and Income Shareholders, receiving dividends and
undistributed revenue reserves over the period to the Winding Up Date (which in
the case of Ordinary Shares and Income Shares are not expected to exceed 3.2
pence per Share in aggregate). These Proposals have been designed to provide
Shareholders with a choice as to what they can do with their investment at the
end of the Company's life.

The Board has formulated the Proposals under which the Company will be put into
members' voluntary liquidation and Shareholders will be able either to
``rollover'' their investment into a new UK investment trust with a broadly
similar investment objective and policy to the Company or into the Cash Fund
(in either case without commission, brokerage or initial charge or the
crystallising of any immediate liability to UK capital gains tax) or to
liquidate their investment and take cash.

Under the Proposals, which are subject to Shareholder approval:

  * The Company will be wound up on 30 October 2003;
   
  * Ordinary Shareholders will have the option of receiving for every 100
    Ordinary Shares:
   
- 4 PUT Ordinary Shares; or

- 3.20 Cash Fund Shares*; or

- 320p pence in cash;

* Based on an expected issue price of 100p per Cash Fund Share

  * Income Shareholders will have the option of receiving the Terminal Asset
    Value of each Income Share in the form of:
   
  * 
      + PUT Ordinary Shares (at an issue price of 100 pence);
       
      + Cash Fund Shares; or
       
      + an equivalent amount of cash.
       
The Terminal Asset Value may be different from the current net asset value per
Income Share because it will be subject to market movements until the
Calculation Date and because the Company will incur costs in relation to the
Proposals and the Liquidators may retain assets to cover unforeseen or
contingent liabilities. The Terminal Asset Value will be calculated as at the
close of business on 27 October 2003 and announced on 28 October 2003.

  * ZCP Shareholders will have the option of receiving 248p for each ZCP Share
    comprised of 247.25p which represents the accrued capital entitlement per
    ZCP Share on 31 October 2003 (as provided for in the Articles) plus 0.75p
    to compensate for early redemption represented by:
   
- PUT Ordinary Shares and PUT ZDP Shares at an issue price of 100 pence per PUT
Security (in such proportions so that on implementation of the Proposals the
total number of PUT Ordinary Shares in issue shall be equal to the total number
of PUT ZDP Shares in issue but after taking into account PUT Ordinary Shares
elected for by Ordinary Shareholders and Income Shareholders and PUT Securities
issued pursuant to the Placing); or

- Cash Fund Shares or

- an equivalent amount of cash

  * Overseas Holders will receive cash in respect of their holding unless they
    are able to satisfy PUT that they are legally entitled to receive and hold
    PUT Securities;
   
  * Income Shareholders will also be entitled to any distribution made in
    respect of surplus amounts in the Liquidation Fund, which distribution will
    be made in cash only;
   
  * Shareholders who do not make a valid election in respect of all or part of
    their shareholding will be deemed to have elected for PUT Securities.
   
Entitlement to undistributed net reserves of the Company

It is proposed, as part of the Proposals, that the Articles of Association be
amended so that upon liquidation of the Company the Directors are relieved from
their obligation to pay a final interim dividend to the Income and Ordinary
Shareholders equal to the amount standing to the credit of any revenue reserve
arising from undistributed net revenues of the Company before commencing a
liquidation.

The respective entitlements of Shareholders under the Proposals have taken into
account that no such final interim dividend shall be paid. The cash for which
holders of the Ordinary Shares are entitled to elect, for the purposes of the
Scheme, of 3.2 pence per share comprises the anticipated entitlement of
Ordinary Shareholders to their proportionate part of any revenue reserves. Any
residual assets of the Company after making the fixed distributions to the
Ordinary Shareholders and ZCP Shareholders shall be for the benefit of the
Income Shareholders and taken into account (subject as set out above) in
determining their Terminal Asset Value.

PUT

Introduction

PUT is a new UK investment trust, established as the proposed successor to the
Company. PUT's initial share capital will comprise PUT Ordinary Shares and PUT
ZDP shares in equal proportions. Application has been made for the PUT
Securities to be admitted to the Official List and to trading on the London
Stock Exchange's market for listed securities.

PUT has a fixed life of approximately seven years to 31 December 2010.

The board of PUT will have overall responsibility for PUT's activities and for
the determination of its investment policy and strategy. PUT's investment
portfolio will be managed by Premier Fund Managers Limited, who will be
responsible for implementing the policies laid down by the board of PUT. PUT
has entered into an investment management agreement with Premier Fund Managers
Limited, pursuant to which Premier Fund Managers Limited will receive an annual
management fee of 1 per cent. of PUT's gross assets and will be entitled to a
performance fee based on dividends paid or proposed to be paid in respect of an
accounting period and the increase in the value of PUT's gross assets subject
to a minimum performance and high water mark. This agreement is terminable on
12 months' notice not to be given before the first anniversary of that
agreement.

Investment objective

PUT's investment objectives are to achieve a high income from its Portfolio and
to realise long-term growth in the capital value of its portfolio. PUT will
seek to achieve these objectives by investing principally in equity and equity
related securities of water, electric power, gas distribution and regulated
infrastructure companies. In seeking to achieve its investment objective PUT
will not invest in other investment companies.

Investment policy

PUT's assets will be invested in a diverse portfolio of equity and
equity-related securities of companies operating in the water, electric power,
gas distribution and regulated infrastructure industries. The number of
investments will vary according to the opportunities available but is expected
to comprise between 30 and 50 investments.

PUT's investments will principally be in companies listed on recognised stock
exchanges in the United Kingdom, Continental Europe, United States and other
OECD countries. However, PUT may invest up to 20 per cent. of its assets in
companies whose securities are traded on recognised stock exchanges in certain
non-OECD countries.

PUT may also invest up to 15 per cent. of its gross assets in unquoted
securities.

Borrowings

PUT will not, without the separate approval of the holders of the PUT Ordinary
Shares and PUT ZDP Shares, enter into arrangements to borrow money for the
purpose of introducing long term gearing into PUT's capital structure. However,
it is intended that PUT will have an overdraft facility for an amount of up to
£5 million to cover short term timing differences on sales and purchases of
investments.

Characteristics of the PUT Securities

PUT's initial capital structure will consist of PUT Ordinary Shares and PUT ZDP
Shares in equal numbers. The rights and characteristics of each class are
summarised below and set out in more detail in the PUT Prospectus which
Shareholders who wish to consider rolling some or all of their investment into
PUT Securities should read carefully.

PUT Ordinary Shares

Dividends

PUT intends to pay quarterly dividends on the PUT Ordinary Shares based on the
revenue for the three months to March, June, September and December of each
year. The first dividend is expected to be an interim dividend in respect of
the period to 31 December 2003, expected to be paid in March 2004.

On the basis of the Issue Price of 100p, dividends which are expected to amount
to 7.875p per PUT Ordinary Share will be paid in respect of the period from
launch to 31 December 2004 which would represent an initial annualised dividend
yield on the PUT Ordinary Shares of 6.75 per cent.*

* These dividend payments and yields do not represent forecasts and represent
the expected level of dividends only and are not intended to be, nor should be,
taken as a forecast of profits.

Capital entitlement

On a winding up of PUT after all PUT's liabilities (including the costs of
winding up) have been met, PUT Ordinary Shareholders will be entitled to all
PUT's net revenue profits (including accumulated but unpaid revenue reserves)
at the time of winding up, and, after the final capital entitlement of PUT ZDP
Shares has been met, to the surplus assets of PUT.

Voting rights

PUT Ordinary Shareholders will be entitled to attend and vote at all general
meetings of PUT. In addition the separate class approval of PUT Ordinary
Shareholders will be required for matters which directly affect that class such
as a winding up of PUT before its planned winding up date or a material change
in PUT's investment policy.

PUT ZDP Shares

Capital entitlement

PUT ZDP Shares are designed to provide a pre-determined final capital
entitlement in priority to any return of capital on the PUT Ordinary Shares
after all liabilities of PUT have been satisfied, except that the PUT Ordinary
Shares will first be entitled to PUT's net revenue profits (including
accumulated but unpaid revenue reserves) at the time of winding up which may be
paid as a dividend or capital payment.

PUT ZDP Shares have an initial capital entitlement of 100p per share, growing
to 162.41p on the Planned Winding Up Date equivalent to a ZDP Redemption Yield
of 7 per cent. per annum on the Issue Price.

Voting rights

Holders of PUT ZDP Shares will be entitled to attend and vote at all general
meetings of PUT. In addition, the separate class consent of the PUT ZDP
Shareholders will be needed for PUT to undertake certain actions which directly
affect them (for instance any proposal to wind up PUT before the Planned
Winding Up Date).

Cash Fund

The Cash Fund will be an investment company named The Premier Money Market Fund
with variable capital incorporated with limited liability and registered in
England and Wales. The Cash Fund has been authorised by the FSA and an
Authorisation Order and UCITS Certificate have been granted. Shares in the Cash
Fund will have no par value and the share capital of the Cash Fund will at all
times equal the sum of its net asset value. Two classes of share will be
issued; Cash Fund Accumulation Shares and Cash Fund Income Shares. However,
only Cash Fund Income Shares will be issued to electing Shareholders.

The investment objective of the Cash Fund is to provide a secure level of
return through investment in cash and near cash instruments with a high degree
of capital security. This will be achieved by the Cash Fund primarily investing
in short-term deposits and other money market instruments.

There will be no emphasis placed on particular economic or industrial sectors
with the object of spreading risk both geographically and by industrial sector.

The Cash Fund Shares are not eligible to be held in PEPs or the stocks and
shares component of an ISA.

Implementation of the Proposals

The Proposals provide for the voluntary winding up and reconstruction of the
Company and for its assets (after setting aside an amount in the Liquidation
Fund in an amount which the Liquidator considers sufficient to provide for all
liabilities of the Company and the entitlements of Shareholders receiving cash
under the Scheme) to be transferred to PUT or the Cash Fund.

Approximately 70 per cent. of the Company's assets currently comprise cash or
government securities with the remainder being investments in utility and
utility related companies.

Those assets which are transferred to PUT (which it is anticipated will be
investments in utility and utility related companies to the extent possible)
and the Cash Fund will be transferred in exchange for the issue of PUT
Securities and Cash Fund Shares respectively. The number of PUT Securities and/
or Cash Fund Shares to be allotted to Shareholders under the Proposals will be
calculated as set out above.

Implementation of the Proposals is conditional upon, inter alia:

* the passing of all the Resolutions;

* Admission of the PUT Securities; and

* the initial gross assets (before the deduction of expenses) of PUT being at
least £20 million.

However, if all of the Resolutions have been passed at the Separate General
Meetings and at the First EGM and the Second EGM but either or both of the
conditions as to Admission of the PUT Securities and the initial gross assets
of PUT (before the deduction of expenses) being at least £20 million are not
satisfied, the Directors will proceed with the Scheme on the basis of the Cash
Fund and Cash Option only. In this event Shareholders electing for PUT
Securities will be deemed to have elected for Cash Fund Shares.

Benefits of the Proposals

The Directors believe that the Proposals will satisfy the differing
requirements of Shareholders by offering them the following advantages:

* cash for those Shareholders who do not wish to continue their investment;

* a successor London listed closed-end investment trust company for those
Shareholders who wish to continue their investment;

* the prospect for Ordinary Shareholders and Income Shareholders of a
continuing income stream for a further seven years;

* the ability for Ordinary Shareholders to preserve some capital value in their
investment as opposed to only receiving interim dividends and accumulated
revenue reserves to the Winding Up Date which are not expected to exceed 3.2
pence per Ordinary Share in aggregate;

* the opportunity for Ordinary Shareholders and Income Shareholders to
participate in any future capital growth;

* the opportunity for ZCP Shareholders to invest in PUT ZDP Shares with a life
of approximately seven years and a fixed capital growth rate of 7 per cent. per
annum;

* continuity of investment manager: Mr Whalley, the individual manager
responsible for the day-to-day management of the Company's assets will be
responsible for the management of PUT's assets;

and

* the opportunity for Shareholders to rollover their investment in the Company
into PUT and/or the Cash Fund without crystallising any immediate liability to
UK capital gains tax.

Costs of the Proposals

The costs payable by the Company (including irrecoverable VAT) are not expected
to exceed £510,000.

If the Company were to be liquidated on the Winding Up Date, all costs of the
liquidation would effectively be borne by the Income Shareholders from the
residual net assets of the Company after payment of the accrued capital
entitlement of the ZCP Shareholders. The costs of the Proposals will therefore
effectively be borne by the Income Shareholders and taken into account in
determining their Terminal Asset Value out of the residual net assets of the
Company.

Dealings in Shares on the London Stock Exchange

The last day for trading in the Shares on the London Stock Exchange for normal
settlement (in order to enable settlement prior to the Record Date) will be 15
October 2003. The Record Date, being the date for determining which
Shareholders are entitled to participate in the Scheme, is the close of
business on 20 October 2003 on which date dealings in the Shares are expected
to be suspended.

Transfer of Manager

The existing Investment Manager has announced its intention to cease providing
investment management services to closed-end investment trusts. Accordingly the
Company and the Investment Manager have agreed (with the consent of the
Directors) that if the Proposals are not implemented and there is no early
winding up of the Company, then the existing investment management agreement
between the Investment Manager and the Company will be novated to Premier Fund
Managers with effect from 3 November 2003. Accordingly, for that period until
the Winding Up Date (or any earlier winding up of the Company), Premier Fund
Managers Limited will manage the Company's investments.

Andrew Whalley will be joining Premier Fund Managers Limited with effect from
the earlier of 3 November 2003 and Admission irrespective of whether the
Proposals are implemented and, accordingly, Mr Whalley will continue to manage
the Company's investments through to the Winding Up Date (or any earlier
winding up of the Company).

Loss of investment trust status

In order to attain investment trust status in any financial year the Company
must distribute at least 85 per cent. of its net eligible income (i.e. net
income from its investments). In the event of the Proposals being implemented,
the Company's existing tax accounting period will end on commencement of the
winding up of the Company. At that date it is unlikely that the Company will
have paid sufficient dividends to meet the distribution test referred to above
and accordingly it is unlikely that the Company will maintain investment trust
status in respect of the financial period beginning on 1 January 2003 and
ending on the commencement of the winding up. Furthermore, no application for
admission to the Official List will be made in respect of the Reclassified
Shares. Accordingly, any gains made on the Company's investments during that
period would be subject to tax. However, the Directors have been advised that
in view of the losses made on the Company's investments during that same period
it is very unlikely that any such tax on gains would actually be payable.

If the Proposals are not implemented then it is anticipated that sufficient
dividends will be paid prior to a winding up of the Company to attain
investment trust status in respect of the current accounting period.

Consequences of not implementing the Proposals

In the event that the conditions of the Proposals are not satisfied, the
Proposals in the form set out in this document will not be implemented.

However, if all of the resolutions have been passed at the Separate General
Meetings and at the First EGM and the Second EGM but either or both of the
conditions as to Admission of the PUT Securities and the initial gross assets
of PUT (before the deduction of expenses) being at least £20 million are not
satisfied, the Directors will proceed with the Scheme on the basis of the Cash
Fund and Cash Option only. In this event Shareholders electing for PUT
Securities will be deemed to have elected for Cash Fund Shares.

Shareholders who redeem Cash Fund Shares within two weeks of becoming Cash Fund
Shareholders will not be charged for such redemptions.

Recommendation

The Directors, who have been advised by Collins Stewart, consider that the
Proposals are in the best interests of Shareholders as a whole. In providing
advice to the Directors, Collins Stewart has taken into account the Directors'
commercial assessments of the Proposals.

Accordingly, the Directors unanimously recommend Shareholders to vote in favour
of the extraordinary resolutions to be proposed at the Separate General
Meetings and the special and extraordinary resolutions to be proposed at the
First and Second EGMs. The Directors, in respect of their own beneficial
holdings which in aggregate amount to 39,871 Ordinary Shares, 194,185 Income
Shares and 10,000 ZCP Shares, representing approximately 0.14 per cent. of the
Company's issued share capital intend to vote in favour of all resolutions.

EXPECTED TIMETABLE

2003

Latest time and date for receipt of Forms of Election

and Forms of Direction from investors in a LeggMason Plan 3.00 p.m. 18 October

Share register closed, dealings suspended and Shares disabled in CREST 20
October

Record Date close of business 20 October

Latest time and date for receipt of Forms of Election from Ordinary
Shareholders,

Income Shareholders and ZCP Shareholders 3.00 p.m. 21 October

Latest time and date for receipt of Forms of Proxy for the Separate General

Meeting of Ordinary Shareholders 10.00 a.m. 21 October

Latest time and date for receipt of Forms of Proxy for the Separate General

Meeting of Income Shareholders 10.02 a.m. 21 October

Latest time and date for receipt of Forms of Proxy for the Separate General

Meeting of ZCP Shareholders 10.04 a.m. 21 October

Latest time and date for receipt of Forms of Proxy for the First EGM 10.06 a.m.
21 October

Separate General Meeting of Ordinary Shareholders 10.00 a.m. 23 October

Separate General Meeting of Income Shareholders* 10.02 a.m. 23 October

Separate General Meeting of ZCP Shareholders* 10.04 a.m. 23 October

First EGM* 10.06 a.m. 23 October

Calculation Date Close of business 27 October

Latest time for receipt of Forms of Proxy for the Second EGM 10.00 a.m. 28
October

Second EGM 10.00 a.m. 30 October

Effective Date for implementation of the Proposals and commencement of the
liquidation 30 October

Dealings commence in PUT Securities on the London Stock Exchange and PUT
Securities issued

in uncertificated form under the Scheme credited to accounts of Shareholders
entitled thereto 31 October

Definitive certificates in respect of PUT Securities issued in certificated
form despatched

to Shareholders entitled thereto week commencing 3 November

Cheques despatched to Shareholders entitled to cash in respect of elections for
the Cash Option week commencing 10 November

* or as soon thereafter as the immediately preceding meeting shall have been
concluded or adjourned.

Circular to Shareholders

Capitalised terms used in this announcement bear the meanings ascribed to them
in the Circular dated 29 September 2003.

A copy of the Circular and of the Prospectus issued by Premier Utilities Trust
plc have been submitted to the UK Listing Authority and will shortly be
available for inspection at the UK Listing Authority's Document Viewing
Facility, which is situated at:

Financial Services Authority

25 The North Colonnade

Canary Wharf

London E14 5HS

Tel: 020 7676 1000

Enquiries: Paul Richards

Collins Stewart Limited

Tel: 020 7523 8350

End