GTI in talks with HBG on takeover HCG

It is reasonable to expect both companies to reach a final agreement in the foreseeable future. GTI and HBG expect to complete the transaction in early 2001. GTI will finance the acquisition entirely from its own capital and expects HCG to make a contribution to profit from 1 January 2001.

HCG operates from several locations as an industrial contractor on the market for industrial services. It specialises in engineering, project management, manufacture and assembly of process installation, pipe and air treatment systems, equipment manufacture and maintenance. There is a growing demand for multi-discipline services, combining mechanical engineering with electrical engineering and instrumentation. In addition to its traditional services, HCG has therefore in recent years focused increasingly on multi-discipline contracts and total-care-maintenance projects in the industrial market. HCG was founded in 1914 and has been part of HBG since 1969. HCG booked a moderate positive result on a turnover of around EUR 150 million in 1999 and has more than 1,200 employees.

The acquisition is fully in line with GTI’s strategy of selective growth through acquisitions. The acquisition will boost the position of the division GTI Industry, in which HCG will be integrated, as an integral technical service provider in the industrial market. This is an effective response to the requirements of customers who are increasingly opting to farm out projects and maintenance processes to a single multi-discipline provider. The addition of HCG makes GTI Industry the largest industrial technical services provider in the Netherlands, with approximately 3,300 employees and a turnover of more than EUR 400 million.

The acquisition of HCG subsidiary FIB will put GTI in a strong position, particularly in the food and beverage, pharmaceuticals and paper sectors. This will ensure a more balanced distribution across the various market segments and makes GTI less dependent on developments in heavy industry.

Given that both the regional distribution and the various activities of the HCG companies are extremely complementary to those of GTI, the acquisition will create a network of companies with national coverage. This allows GTI to offer customers in every region a complete range of mechanical, electrical engineering and instrumentation and industrial services. The increase in scale will also mean a further boost to the continued development of new concepts and products, the realisation of cost synergies and the more effective utilisation of production capacity by the individual companies.

HBG believes that the future development of HCG requires a strengthening of the activities in the field of electrical engineering and instrumentation. The planned acquisition by and integration in GTI will be a strong boost to growth in turnover and results. HBG has launched a strategic reorientation. The planned sale of HCG allows HBG to give more attention and priority to achieving profitable growth in the core activities of construction, dredging and consultancy and engineering.

The Merger commission of the Social Economic Council (SER) and the relevant trade union organisations have been informed. The Representative Body involved has been asked for its recommendation in line with the Works Councils Act.

GTI provides technical services in the building services, industrial and infrastructure sectors in the Netherlands and Belgium. GTI booked a turnover of EUR 900 million and net profit of EUR 23 million in 1999. The company has around 8,000 employees. The division GTI Industry aims to be a trend-setting full-service group of companies with a coherent and complete package of technical services for the industrial sector.

For additional information, please contact:

GTI nv:

Peter C.M. Bassa, Director Corporate Marketing and Communications, Kosterijland 50, 3981 AJ  Bunnik; P.O. Box 210, 3980 CE  Bunnik, the Netherlands, telephone: +31 (0)30 656 94 57; fax: +31 (0)30 656 94 15, e-mail: info@gti-group.com; internet: www.gti-group.com;

HBG, Hollandsche Beton Groep nv:

Arno C. Pronk,  head of Public Relations, Generaal Spoorlaan 489, 2285 TA  Rijswijk; P.O. Box 81, 2280 AB  Rijswijk, the Netherlands, telephone: +31 (0)70 372 21 21; fax: +31 (0)70 372 25 84, e-mail: apronk@hbg.nl; internet: www.hbg.nl.