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On July 22, the Chairman of Compagnie de Saint-Gobain contacted the Chairman of the Board of BPB, seeking his recommendation for a cash offer at 675p per share. The proposal was fully financed and subject to limited due diligence. The offer was rejected by BPB’s Board of Directors. Whilst Compagnie de Saint-Gobain was surprised by this response and disappointed that the management of BPB did not wish to enter into discussions, its objective remains to seek an agreement with BPB, for a recommended deal.

Interior fittings solutions (including partitions, ceilings and insulation) are the core businesses of both BPB and Saint-Gobain’s Insulation activity. These businesses have the characteristics that Saint-Gobain focuses on, such as strong growth, profitability and high potential for free cash flow generation, together with a multi-regional market approach.

BPB’s businesses present an excellent strategic fit with Saint-Gobain’s “Construction Products” Sector, which includes Insulation. They cater to a similar client base (contractors, distributors, craftsmen), and offer complementary products. Furthermore, their respective geographical locations would help to step up expansion in emerging markets.

Compagnie de Saint-Gobain has noted BPB’s first quarter 2005/2006 trading statement. It continues to examine its options in respect of BPB, which might or might not lead to a cash offer being made for BPB. Compagnie de Saint-Gobain believes there is strategic merit in combining the businesses and reaffirms its high regard for BPB’s executives and senior management team. However, it will only enter into a deal at a price it believes creates value for its shareholders.