ENN Ennstone

    RNS Number : 2057K
  Ennstone PLC
  16 December 2008
   

    Ennstone plc
    ("Ennstone" or "the Group")

    Update on Financial Position

    The Ennstone Board is continuing to explore all available options to realise value for shareholders, including business and asset sales
and an injection of new capital. 

    On 19 November 2008, the Group announced a temporary waiver of certain technical breaches of the Group's facilities agreement. This
waiver expires on 18 December 2008 and the Group is in discussions with its debt providers regarding an extension. The Group continues to
expect to exceed its UK banking facility headroom by the end of December 2008.

    As a result of the deteriorating cash position in the US, Ennstone has now suspended payments of interest charges and finance lease
repayments on its US facilities and is in discussions with its US lenders regarding restructuring proposals for Ennstone's US subsidiary,
Ennstone, Inc. Accordingly, the Group is in breach of its US facilities, and, via cross-default, in breach of its UK facilities. The US and
UK debt providers are aware of the current breaches and are currently considering their position including potential waivers of the
breaches. As previously announced, Ennstone will be in breach of its UK and US banking covenants as at 31 December 2008 unless agreements
are reached with the lenders.

    Notwithstanding the above breaches of the Group's facilities, Ennstone continues to be in ongoing discussions and is co-operating fully
with its UK and US banking syndicates.  

    The Group is in advanced discussions regarding potential disposals which could provide sufficient liquidity to meet cash requirements in
both the UK and the US until the end of January 2009. Although there can be no assurance given that such disposals will be completed, the
Board is hopeful that the funds raised from such disposals will provide sufficient time to agree a restructuring of the Group's banking
facilities or to find the necessary alternative financing for the Group.

    A further announcement will be made in due course.

    Enquiries:

 Ennstone plc                                  01332 694 444
 Graham Brown/Vaughan McLeod               
 Altium                                        0161 831 9133
 Phil Adams

 College Hill                                  0207 457 2020
 Mark Garraway                



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