Arriva PLC

Recommended Cash Offer for MTL Services

Arriva PLC
18 February 2000


NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES OF
AMERICA, CANADA, AUSTRALIA OR JAPAN


ARRIVA plc

RECOMMENDED CASH OFFER FOR

MTL SERVICES plc

OFFER WHOLLY UNCONDITIONAL
AND
AGREEMENT REACHED WITH SSRA RE RAIL FRANCHISES



ARRIVA announces that as at 3.00 p.m. on 17 February 2000, the first closing
date of the Offer, valid acceptances under the Offer had been received in
respect of 78,524,576 MTL Shares, representing approximately 90.5 per cent of
the issued ordinary share capital of MTL. 

Accordingly, ARRIVA announces that the remaining conditions of the Offer have
been satisfied or, where permitted, waived and consequently the Offer has
become wholly unconditional. 

The Offer, including the Loan Note Alternative, has been extended until 3.00pm
on 2 March 2000.  MTL Shareholders who wish to accept the Offer and have not
yet done so should despatch their Forms of Acceptance as soon as possible.
However, ARRIVA has now received sufficient acceptances to apply the statutory
provisions to acquire compulsorily any outstanding MTL Shares and will be
implementing procedures to achieve this shortly.

Consideration in respect of valid acceptances already received will be sent to
MTL Shareholders within the next 14 days.  Subsequent acceptors will receive
their consideration within 14 days of receipt of their valid acceptance.   

On the day the Offer was announced, ARRIVA held irrevocable undertakings in
respect of 17,250,032 MTL Shares, representing approximately 19.8 per cent of
the issued ordinary share capital of MTL.  ARRIVA has received valid
acceptances in respect of all of these MTL Shares.

Immediately prior to the commencement of the Offer Period on 20 December 1999,
neither ARRIVA nor any person deemed to be acting in concert with ARRIVA held
any MTL Shares or rights over MTL Shares.  Save as stated above, neither
ARRIVA nor any party deemed to be acting in concert with ARRIVA has acquired
or agreed to acquire any MTL Shares (or rights over MTL Shares) since the
commencement of the Offer Period, or received any acceptances of the Offer
during the Offer Period, and no acceptances have been received from any party
deemed to be acting in concert with ARRIVA.

With regard to the two rail franchises owned by MTL, ARRIVA is pleased to
announce that it has now reached agreement in principle with the Shadow
Strategic Rail Authority ('SSRA'), that it will become the owner of these
operations and will hold the franchise rights for twelve months until 18
February 2001.  The SSRA will be seeking re-negotiation of the Northern Spirit
and Merseyrail Electrics franchises on a competitive basis to follow expiry of
the twelve months.  Merseyside Passenger Transport Executive, co-signatory
with the SSRA on the Merseyrail Electrics franchise, and the Local Passenger
Transport Executives in West Yorkshire, South Yorkshire, Greater Manchester
and Tyne & Wear, co-signatories with the SSRA on the Northern Spirit
franchise, have all given their consent in principle to the change of control
of the operations. Service levels will be maintained at current levels on both
networks.  There will be no change to the levels of the operating subsidy
contributed by the SSRA and the Local Passenger Transport Executives, which
will remain as originally negotiated with MTL for the period to 18 February
2001. The Franchising Director's approval is subject to completion of final
legal documentation.

Enquiries:
 
ARRIVA                                 Telephone:       0191 520 4000
Bob Davies               
Steve Lonsdale
Julian Evans       

N M Rothschild                         Telephone:       0207 280 5000
(Financial adviser to ARRIVA)
Avi Goldberg
Jeremy Moodey

Gavin Anderson & Co                    Telephone:       0207 457 2345
(Financial PR adviser to ARRIVA)
Marc Popiolek
Neil Garnett
 
Unless the context otherwise requires, the definitions contained in the Offer
Document dated 27 January 2000 also apply to this announcement.  The Offer,
including the Loan Note Alternative, is not being made, directly or
indirectly, in or into, or by use of the mails of, or by any means or
instrumentality (including, without limitation, facsimile transmission, telex
or telephone) of interstate or foreign commerce of, or any facility of a
national securities exchange of, the United States, Canada, Australia or Japan
and the Offer cannot be accepted by any such use, means, instrumentality or
facility or from within the United States, Canada, Australia or Japan.
Accordingly, copies of this announcement are not being and must not be mailed
or otherwise distributed or sent in, into or from the United States, Canada,
Australia or Japan and persons receiving a copy of this announcement
(including custodians, nominees and trustees) must not distribute or send them
in, into or from the United States, Canada, Australia or Japan.
 
N M Rothschild, which is regulated in the United Kingdom by The Securities and
Futures Authority Limited, is acting for ARRIVA and no one else in connection
with the Offer and will not be responsible to anyone other than ARRIVA for
providing the protections afforded to customers of N M Rothschild or for
giving advice in relation to the Offer. 

The directors of ARRIVA, whose names appear in the Offer Document, accept
responsibility for the information contained in this announcement.  To the
best of the knowledge and belief of the directors of ARRIVA (who have taken
all reasonable care to ensure that such is the case) the information contained
in this announcement is in accordance with the facts and does not omit
anything likely to affect the import of such information.