Eleco PLC 23 August 2007 ELECO PLC Advice to shareholders Dear Shareholder, We have recently been informed by some Eleco shareholders that they have been targeted by individuals acting on behalf of a purported Canadian company claiming to act for a potential acquirer who is offering to pay prices significantly in excess of the prevailing stock market price, with a view to acquiring 51 per cent. of Eleco's shares. There are good grounds to suspect that this claim and other statements that have been made regarding levels of interest received from other shareholders may not be genuine and appear to be aimed at persuading shareholders to deliver their share certificates and or bank details to those making the calls. We advise any of our shareholders receiving calls of this nature to exercise extreme caution. According to those shareholders who have brought the telephone contacts received by them to the attention of the Company, the callers are very persistent and extremely persuasive in trying to convince shareholders that a bidder is stake building and that any intended offer made subsequently would be unrealistically in excess of the Company's current share price and would be justified by the bidder's intention to reach a majority shareholding. If you receive any unsolicited investment advice regarding the possible sale of your Eleco shares as a consequence of such calls, we suggest you: - obtain the correct name of the person and organisation; - check at www.fsa.gov.uk/register that they are properly authorised by the FSA before getting involved further or at all; - check the FSA website for a list of unauthorised overseas firms who are targeting, or have targeted, UK investors at http://www.fsa.gov.uk/pages/ doing/regulated/law/alerts/overseas.shtml; - inform us of such circumstances by emailing our Company Secretary at ivor.barton @eleco.com Any approach from such organisations should be reported to the FSA to enable them to update their records and consider any other appropriate action. More information on this and similar activities can be found on the FSA website at www.fsa.gov.uk/consumer We wish to stress that this incident has had no impact whatsoever on our trading and there is no reason why it should do so. Enclosed is an appendix containing the Pre-Close Trading Update recently issued by the Company on 3 August 2007. Yours sincerely, John Ketteley Chairman Contact details: John Ketteley, Chairman David Dannhauser, Finance Director Tel: +44 (0)1920 443830 Collins Stewart Europe Limited, Te: +44 (0)208 523 8323 Adventis Financial PR, Tel: +44 (0)207 034 4758/59 A copy of this announcement has been placed on the Company's website and can be found at http://www.eleco.com/eleco/news_spotlight/rule_26.asp Copies of the announcement will be dispatched to shareholders. APPENDIX 1 Pre-Closed Period Trading update & Appointment of Nominated Adviser and Broker The Board of Eleco plc today announces its trading update for the year ended 30 June 2007. The Group's preliminary results for the year ended 30 June 2007 will be announced on Tuesday, 2 October 2007. Trading Overall, business and cash generation remained strong in the second half of the year in line with management's expectation and Asta Development, acquired in December 2006, made an encouraging contribution to profit. As a consequence, results for the year ended 30 June 2007 will be in line with market expectations. Orders at 1 July 2007 at our Building Systems businesses were significantly higher than last year due principally to a substantial increase in demand for Bell & Webster Concrete's pre-cast products; the outlook for our Software businesses has also improved. We therefore enter the current year with confidence. Nominated adviser and Broker In addition, the Board is pleased to have agreed to the appointment of Collins Stewart (Europe) Limited as Nominated Adviser and Broker to the Group. John Ketteley, Executive Chairman commented: "Eleco has achieved the growth anticipated by the market and results for the year ended 30 June 2007 will be in line with market expectations. We are very well positioned to contribute to the Government's drive to accelerate the building of affordable sustainable housing; we are in a strong financial position; and we look forward with confidence to the year ahead." Enquiries: Eleco plc Ivor Barton - Company Secretary +44 (0) 1920 443830 Collins Stuart Europe Limited 9th Floor, 88 Wood Street, London EC2V 7QR Adventis Financial PR Tarquin Edwards/Chris Steele +44 (0) 20 7034 3758/4759 +44 (0) 7879 458 364 +44 (0) 7979 604 687 This information is provided by RNS The company news service from the London Stock Exchange