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CPL refinancing and restructuring May 2006

CPL Industries Limited - Successful Re-financing and Restructuring

Following another year of strong trading results and improved operational efficiency, CPL Industries is pleased to announce the successful signing of a simultaneous re-financing agreement and re-structuring of its balance sheet which will significantly strengthen the financial position of the Company.

During the past five years, CPL has undergone a major re-structuring program under an experienced management team led by its Chief Executive, Andrew Glasgow. In the year ended 31 March 2006, the Group has seen further significant progress in re-positioning the business and reducing its debt level. Despite a challenging external economic environment, including the continuing rise in the price of oil and solid fuel raw materials, rigorous management of costs and working capital has enabled the Group to produce an improved trading result and to reduce net borrowings to £65m compared to a peak of £160m in 2001.

Having achieved an impressive turnaround in the Group’s operating and financial performance, the Board has resolved to create a more stable platform with a longer term borrowing facility, at significantly lower cost, while strengthening the balance sheet by consolidating its complex share structure under new ownership.

Accordingly, new loan facilities have been agreed with Burdale Financial Limited, a member of Bank of Ireland Group on the basis of a five year, £85m debt facility. This facility will be used to pay down all existing debt and provide working capital, at rates that will halve current debt service costs.

Dennis Levine, Chief Executive of Burdale, said: "Burdale is very pleased to be providing CPL with a facility which was structured to cater specifically for the business’ future needs.   We have total confidence in CPL’s management and that this new facility will enable the company to achieve its long-term objectives."

In support of CPL and this transaction, Royal Bank of Scotland and Vision Capital, both previous lenders to the Company, will each become a major shareholder of the Company. Commenting on the re-financing and balance sheet re-structuring, Andrew Glasgow, Chief Executive of CPL Industries, said:

“CPL has made great progress in recent years and the new agreements with our lenders and shareholders will serve to reinforce our position as a profitable business with a secure and long term future.”

Vision Capital is a limited liability partnership | Registered in England number: OC336240 | Authorised and regulated by the Financial Conduct Authority