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29 January 2003

Smiths Group has completed the private placement of US $250 million in senior notes with eleven leading North American institutional investors. The notes have a ten-year term and a coupon of 5.45%, priced at 140 basis points over the 10-year US Treasury.

The funds raised are being used to repay bank borrowings and provide a better spread of debt maturity profile for the company. A substantial part of the new issue has already been swapped into floating rate debt, taking advantage of current US interest rates. Smiths Group generates more than half of its income in the US, and the company has a policy of matching assets in the countries where it operates with borrowings in local currencies.

The initial offering of $200m was more than twice oversubscribed, allowing the company to increase the issue to $250m while retaining an attractive coupon. Smiths Group continues to be rated at A- by Standard & Poors and A3 by Moodys.

Alan Thomson, Financial Director, commented: This private placement demonstrates Smiths ability to raise debt in the key markets on the back of a strong credit profile and a conservative balance sheet. Our interest cover, based on EBITDA, is more than 10 times at present.

The placement was co-arranged by HSBC and Wachovia Securities.


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