Elektron PLC 23 June 2005 FOR IMMEDIATE RELEASE 23 June 2005 ELEKTRON PLC ("Elektron" or the "Company") Proposed consolidation and sub-division of the Company's existing ordinary shares of 5p each The Company announces that it is writing to shareholders setting out proposals to consolidate and then sub-divide the Company's share capital. These proposals will be voted upon at the Company's forthcoming Annual General Meeting ("the AGM"), which will be held at 3.00 pm on Thursday 28 July 2005 at Alfreds Way, Barking, Essex IG11 0AZ. Share Consolidation The Company currently has just over 2,800 shareholders. Of these almost 1,250 shareholders have registered holdings of less than 2,000 ordinary shares, representing some 45% of the total number of shareholders but less than 1.5% of the issued ordinary shares. As at the close of business on Friday 17 June 2005, a shareholding of 2,000 ordinary shares was worth £230 at the mid-market price. The Board believes that for a company of its size, it is not in the Company's best interests to continue to bear the significant costs of servicing such a large shareholder base. The Board also believes that, due to their small holdings, many of such shareholders may have considered selling their ordinary shares but have decided not to do so in the light of disproportionate dealing and administration costs relating to such a sale. The Board is therefore proposing a restructuring of the Company's ordinary shares, the effect of which will be to reduce the number of shareholders hence achieving costs savings for the Company, whilst at the same time returning value, free from transaction costs, to those smaller shareholders. It is proposed to achieve this by first consolidating every 2,000 ordinary shares of 5p each into one Consolidated Share of £100. As a consequence of the consolidation, if a shareholder holds less than 2,000 ordinary shares at the time the proposed consolidation takes effect, he or she will not receive any new Consolidated Shares in the Company but will receive a fractional entitlement to a Consolidated Share, which will be aggregated with other such fractional entitlements and sold by the Company on his or her behalf. With a view to maximizing the sale price of such fractional shares, the Company will itself then purchase those fractional entitlements at the equivalent mid-market price for the Consolidated Shares on the day preceding the purchase. If a shareholder holds more than 2,000 ordinary shares at the time the proposed consolidation takes effect, then unless his or her shareholding is exactly divisible by 2,000 he or she will be left with a whole number of Consolidated Shares together with a fractional entitlement to a Consolidated Share, all of which will be converted into New Ordinary Shares in the sub-division described below, which will follow the consolidation. The Record Date for the proposed consolidation will be the close of business on 5 August 2005 and, if approved by shareholders, the proposed consolidation will become effective at that time, to be followed immediately thereafter by the sale and purchase of the fractional Consolidated Shares, and then the sub-division, each of which are described further below. The Record Date for the final dividend is 8 July 2005, and therefore the consolidation and associated matters will have no bearing on dividend entitlements. Sale and Purchase of Fractional Consolidated Shares Holders of only fractional entitlements to Consolidated Shares will receive a proportional payment for their fractional share entitlement by cheque within 14 days of the consolidation taking place, and all such fractional entitlements to Consolidated Shares which are purchased by the Company will either be cancelled or held in treasury and converted into New Ordinary Shares in the sub-division described below. Share Sub-division In order to avoid the share consolidation having a detrimental effect on the market price of the Company's shares, and to avoid any confusion that might otherwise arise from the share consolidation, the Board is proposing that, immediately following the consolidation and the sale and purchase of the fractional Consolidated Shares by the Company, each Consolidated Share of £100 each will be subdivided into 2,000 New Ordinary Shares of 5p each. The Record Date for the sub-division will be the same as for the consolidation. Share Rights The New Ordinary Shares created by the consolidation and sub-division of the Company's existing ordinary shares will have the same rights as the existing ordinary shares including rights relating to dividends and voting, and the proposed consolidation and sub-division is subject to and conditional upon the New Ordinary Shares being admitted to trading to AIM. It is expected that dealings in the existing ordinary shares will continue until close of business on the Record Date and that admission of the New Ordinary Shares will become effective and dealings for normal settlement will commence at 8 am on the date one business day after the Record Date. Expected Timetable of Events Latest time and date for receipt of forms of proxy 3.00 pm on 26 July 2005 Annual General Meeting 3.00 pm on 28 July 2005 Record Date for the Share Consolidation 4.30 pm 5 August 2005 Share Consolidation 5 August 2005 Sale and Purchase of fractional entitlements 5 August 2005 Share Sub-division 5 August 2005 Commencement of dealings in New Ordinary Shares 8.00 am 8 August 2005 CREST accounts credited with New Ordinary Shares 8 August 2005 Payment (where applicable) of fractional entitlements, by 19 August 2005 despatch of certificates for New Ordinary Shares Significant Shareholdings The following shareholders have indicated that they will vote in favour of the proposed consolidation: Shareholder Percentage shareholding Panther Securities Plc and related parties 14.97% Mr. J Kinder 13.40% Trustees of the A F Bulgin Settlements 8.25% Rathbone Nominees 5.23% Mr. & Mrs. R A R Bulgin 3.45% Recommendation The Directors of the Company consider that the proposed consolidation, purchase of own shares, and sub-division of the Company's shares are in the best interests of the Company. Accordingly the Directors unanimously recommend that shareholders vote in favour of the Resolutions set out in the Notice of the AGM as they intend to do in respect of their own beneficial shareholdings of 2,795,562 representing 3.7% of the existing issued share capital of the Company and non-beneficial holdings of 664,500 shares representing 0.9% of the existing issued share capital of the Company. Notice of an Annual General Meeting Notice of the Annual General Meeting of the Company in the premises of Elektron Plc, Alfreds Way, Barking, Essex, IG11 0AZ on Thursday 28 July 2005 at 3pm is included on page 33 of the annual report and accounts which are also being sent to shareholders. ENDS For further information please contact: Adrian Girling Christopher Leigh Executive Chairman Finance Director Elektron Plc Elektron Plc Tel: 0208 477 9300 Tel: 0208 477 9300 Michael Cornish Beaumont Cornish Limited Tel: 0207 628 3396 This information is provided by RNS The company news service from the London Stock Exchange