Rights Issue

NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE PUBLICATION, DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL. OTHER RESTRICTIONS ARE APPLICABLE. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THE PRESS RELEASE.

THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS AND INVESTORS SHOULD NOT SUBSCRIBE FOR OR PURCHASE ANY TRANSFERABLE SECURITIES REFERRED TO IN THIS ANNOUNCEMENT EXCEPT ON THE BASIS OF THE INFORMATION IN THE PROSPECTUS TO BE PUBLISHED BY LAMPRELL PLC IN CONNECTION WITH THE RIGHTS ISSUE. COPIES OF THE PROSPECTUS WILL, FOLLOWING PUBLICATION, BE AVAILABLE FOR INSPECTION AT COMPANY'S REGISTERED OFFICE AT FORT ANNE, DOUGLAS IM1 5PD, ISLE OF MAN AND FROM THE COMPANY'S WEBSITE.

16 May 2014

Lamprell plc

5 for 16 Rights Issue of 81,363,469 ordinary shares at 88 pence to raise

approximately US$120 million (the "Rights Issue")

The Board of Lamprell plc ("Lamprell" or the "Company", and together with its subsidiaries, the "Group"), a leading provider of diversified engineering and contracting services to the onshore and offshore oil & gas and renewable industry, today announces a fully underwritten Rights Issue to raise gross proceeds of approximately £71.6 million (US$120.3 million). In conjunction with a debt refinancing also announced by the Company today in its interim management statement for the period from 1 January 2014 to 15 May 2014, the Rights Issue is intended to provide a stronger platform for the successful execution of the Group's growth strategy.

Highlights

· Enables the Group to deliver on its growth strategy by improving its competitive position through operational improvements and financial flexibility.

· Intention to raise gross proceeds of approximately £71.6 million (US$120.3million), facilitating its debt refinancing of US$350.0 million.

· Will allow the Group to repay in full the borrowings under term loan facility B of its Existing Facilities, as well as reducing the Group's financing costs.

· Supports the implementation of the Group's strategy to improve profitability.

· Rights Issue expected to be earnings accretive for the Group over the medium-term.

· Supported by the Principal Shareholder.

Rationale for the Rights Issue

· Following the Company's return to profitability, the focus is now on generating sustainable long-term growth and the additional funding will put the Group on a stronger footing to deliver its strategy.

· The Rights Issue will provide Lamprell with funds to support a capital investment programme to improve productivity, reduce operating costs, repay certain of the Group's borrowings and to strengthen the Company's balance sheet and working capital flexibility.

· More specifically the Rights Issue will allow the Group to:

o implement a programme of automation, productivity improvement and cost reduction to enable the Group to leverage its current strong position in its core markets, particularly in the new build jack-up rigs and offshore construction markets;

o place itself in a stronger competitive position by allowing it to offer its customers a solution for new build jack-up rigs which combines high build quality, world class safety, timely delivery, as well as additional commercial optionality; and

o maintain a more cost effective and sustainable capital structure and enable further enhanced working capital availability, which would enable the Group to access a larger addressable market and support additional project wins.

Details and use of proceeds

· 5 for 16 fully underwritten Rights Issue of 81,363,469 New Ordinary Shares at 88 pence per New Ordinary Share to raise gross proceeds of approximately £71.6 million (US$120.3 million).

· The Issue Price of 88 per New Ordinary Share represents a discount of 39.7 per cent. to the closing price on 15 May 2014, and a 33.4 per cent. discount to the theoretical ex‐rights price.

· The Rights Issue will raise gross proceeds of approximately £71.6 million (US$120.3 million). After the payment of fees and expenses of approximately £4.8 million (US$8.1 million) in connection with the Rights Issue, the Company intends to use the net proceeds of the Rights Issue as follows:

o US$60.0 million will be used for a yard investment programme, including a new panel line, newer welding processes, an improved electrical distribution system and improved cutting and blasting and painting facilities, as well as supporting operational systems, with an expected payback period of three to four years;

o US$10.6 million will be used to repay in full the borrowings under term loan facility B of its Existing Facilities, after the repayment of US$ 49.5 million out of the proceeds of the Inspec Disposal; and

o the balance will be used, together with the New Facilities (once fully unconditional and committed), to strengthen the Group's balance sheet by providing the Group with a more cost effective and sustainable capital structure to enhance its working capital flexibility.

The Rights Issue, which is subject to the approval of Shareholders at the Extraordinary General Meeting, is fully underwritten by J.P. Morgan Cazenove and HSBC. In connection with the Rights Issue, J.P. Morgan Cazenove is acting as Sole Sponsor, Sole Global Coordinator, Joint Bookrunner and Corporate Broker, HSBC is acting as Joint Bookrunner and Rothschild is acting as Financial Adviser to Lamprell.

John Kennedy, Chairman of Lamprell, said:

"In 2013 the management team addressed the legacy issues that the business faced, significantly improved our project execution and returned the Group to profitability. Our strategy of focusing on our existing core activities is delivering much improved results but we expect the proposed rights issue and refinancing to strengthen Lamprell's market position further, allow us to deliver the next phase of our strategy and as a result, generate sustainable long-term value for shareholders."

James Moffat, Chief Executive Officer of Lamprell, said:

"With our operational performance and financial results now fully stabilised, we are focused on establishing a strong financial platform for long-term growth. The rights issue and the refinancing of the Group's debt facility will increase our financial flexibility, allow the Group to invest further in its fabrication yards and secure productivity improvements and cost efficiencies that will increase our competitiveness in our key markets.

Lamprell has a strong market position and is differentiated by its high standards of safety, a keen focus on client satisfaction and high build quality. 2014 has seen us converting our substantial bid pipeline into a contract win from a tier 1 client and it is my strong belief that the changes we are proposing today will enable a stronger Lamprell to further capitalise on the significant growth opportunities that we see in our core markets."

It is expected that a prospectus relating to the Company will be published on 16 May 2014 containing full details of the Rights Issue (the "Prospectus"). Once published, the Prospectus will be made available on the Group's website (www.lamprell.com), and will be made available for inspection at the Company's registered office: Fort Anne, Douglas IM1 5PD, Isle of Man, and will be submitted to the National Storage Mechanism and be available for inspection at www.morningstar.co.uk/uk/nsm.

A PRESENTATION TO INVESTORS AND ANALYSTS WILL TAKE PLACE AT 9:00AM TODAY

ATTENDANCE IS BY INVITATION ONLY

A LIVE TELEPHONE 'LISTEN IN' FACILITY IS AVAILABLE, FOR DETAILS PLEASE CONTACT

+44 (0) 207 353 4200

CONTACTS

Lamprell plc +971 (0) 4 803 9308

James Moffat, Chief Executive Officer

Joanne Curin, Chief Financial Officer

Natalia Erikssen, Investor Relations +44 (0) 78 8552 2989

J.P. Morgan Cazenove +44 (0) 20 7742 4000

Sole Sponsor, Sole Global Coordinator, Joint Bookrunner,Corporate Broker

James Taylor

Nicholas Hall

HSBC +44 (0) 20 7991 8888

Joint Bookrunner

Nick Donald

Mark Long

Rothschild +44 (0) 20 7280 5000

Financial Adviser

David Hemmings

Peter Nicklin

Tulchan Communications +44 (0) 207 353 4200

PR Adviser

Christian Cowley

Martin Robinson

IMPORTANT NOTICE

This preceding summary should be read in conjunction with the full text of the following announcement, together with the Prospectus which is expected to be published today.

This announcement has been issued by and is the sole responsibility of Lamprell plc (the "Company"). A copy of the Prospectus when published will be available from the registered office of the Company and on the Company's website at www.lamprell.com provided that the Prospectus will not, subject to certain exceptions, be available (whether through the website or otherwise) to Qualifying Shareholders in the Excluded Territories. Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this announcement.

The Prospectus will give further details of the New Ordinary Shares, the Nil Paid Rights and the Fully Paid Rights being offered pursuant to the Rights Issue.

This announcement is not a Prospectus but an advertisement and investors should not subscribe for or acquire any Nil Paid Rights, Fully Paid Rights or New Ordinary Shares referred to in this announcement except on the basis of the information contained in the Prospectus. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. The information in this announcement is subject to change.

This announcement is for information purposes only and is not intended to and does not constitute or form part of any offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for, Nil Paid Rights, Fully Paid Rights or New Ordinary Shares or to take up any entitlements to Nil Paid Rights in any jurisdiction in which such an offer or solicitation is unlawful.

The distribution of this announcement and/or the Prospectus and/or the Provisional Allotment Letter and/or the transfer of Nil Paid Rights, Fully Paid Rights and/or New Ordinary Shares into jurisdictions other than the United Kingdom may be restricted by law, and, therefore, persons into whose possession this announcement and/or the Prospectus and/or the Provisional Allotment Letter comes should inform themselves about and observe any such restrictions. Any failure to comply with any such restrictions may constitute a violation of the securities laws of such jurisdiction.

In particular, the information contained in this announcement is not for release, publication or distribution, in whole or in part, directly or indirectly, to persons in the United States, Australia, Canada, Japan, the Republic of South Africa or any other jurisdiction where it would be unlawful and should not be distributed, forwarded to or transmitted in or into any jurisdiction where to do so might constitute a violation of local securities laws or regulations.

This announcement does not constitute or form part of an offer or solicitation to purchase or subscribe for securities of the Company in the United States. None of the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares nor the Provisional Allotment Letters have been or will be registered under the United States Securities Act of 1933, as amended (the ''US Securities Act''), or under the applicable securities laws of any state or other jurisdiction of the United States or the securities legislation of any province or territory of Australia, Canada, Japan or the Republic of South Africa. Accordingly, the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares or the Provisional Allotment Letters may not be offered, sold, resold, delivered or distributed, directly or indirectly, in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with state securities laws, or in or into Australia, Canada, Japan or the Republic of South Africa except in accordance with applicable law. There will be no public offer of Nil Paid Rights, Fully Paid Rights, New Ordinary Shares or the Provisional Allotment Letters in the United States, Australia, Canada, Japan or the Republic of South Africa.

This announcement does not constitute a recommendation concerning the Rights Issue. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this announcement are not to be construed as legal, business, financial or tax advice. Each Shareholder or prospective investor should consult his, her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.

This announcement contains or incorporates by reference "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "projects", "expects", "intends", "aims", "plans", "predicts", "may", "will", "seeks", "could", "would", "shall" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts and include statements regarding the intentions, beliefs or current expectations of the Board concerning, among other things, the Company's results of operations, financial condition, prospects, growth, strategies and the industries in which the Group operates. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future or are beyond the Group's control. Forward-looking statements are not guarantees of future performance and are based on one or more assumptions. The Group's actual results of operations and financial condition and the development of the industries in which the Group operates may differ materially from those suggested by the forward-looking statements contained in this announcement. In addition, even if the Company's actual results of operations, financial condition and the development of the industries in which the Group operates are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments. The forward-looking statements contained in this announcement speak only as of the date of this announcement.

J.P. Morgan Securities plc (which conducts its UK investment banking business as J.P. Morgan Cazenove) ("J.P. Morgan Cazenove"), HSBC Bank plc ("HSBC") and N.M. Rothschild & Sons Limited ("Rothschild"), all of whom are authorised by the Prudential Regulation Authority (the "PRA") and regulated by the Financial Conduct Authority (the "FCA") and PRA, are acting for the Company and for no-one else in connection with the Rights Issue and will not be responsible to anyone (whether or not a recipient of this announcement) other than the Company for providing the protections afforded to its clients or for providing advice in connection with the Rights Issue or any other matter referred to herein.

Apart from the responsibilities and liabilities, if any, which may be imposed on J.P. Morgan Cazenove, HSBC and Rothschild by FSMA nor the regulatory regime established thereunder, none of J.P. Morgan Cazenove, HSBC and Rothschild accepts any responsibility or liability whatsoever or makes any representation or warranty, express or implied, for or in respect of the contents of this announcement, including its accuracy, completeness or verification (or whether any information has been omitted from the announcement) or for any other information or statement made or given or purported to be made by it, or on behalf of it, in connection with the Company, the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares or the Rights Issue, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection. Nothing in this announcement is, or shall be relied upon as, a promise or representation in this respect, whether as to the past or future. J.P. Morgan Cazenove, HSBC and Rothschild accordingly disclaims all and any liability whatsoever, whether arising in tort, contract or otherwise (save as referred to above), which it might otherwise have in respect of this announcement.

In connection with the Rights Issue, each of J.P. Morgan Cazenove, HSBC and any of their respective affiliates, acting as investors for their own accounts, may subscribe for or purchase Nil Paid Rights, Fully Paid Rights or New Ordinary Shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Nil Paid Rights, Fully Paid Rights or New Ordinary Shares and other securities of the Company or related investments in connection with the Rights Issue or otherwise. Accordingly, references in the Prospectus, once published, to the Nil Paid Rights, Fully Paid Rights or New Ordinary Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, each of J.P. Morgan Cazenove, HSBC and any of their respective affiliates acting as investors for their own accounts. J.P. Morgan Cazenove, and HSBC do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

The Company, J.P. Morgan Cazenove, HSBC and Rothschild expressly disclaim any obligations or undertaking to update or revise publicly any statements in this announcement, whether as a result of new information, future events or otherwise, unless required to do so by applicable law, the Prospectus Rules, the Listing Rules, the London Stock Exchange Rules or the Disclosure and Transparency Rules.

16 May 2014

Lamprell plc

5 for 16 Rights Issue of 81,363,469 shares at 88 pence to raise approximately US$120 million

Introduction

Lamprell is proposing to raise gross proceeds of approximately £71.6 million (US$120.3 million) (approximately £66.8 million (US$112.2 million) net of expenses) by way of a 5 for 16 Rights Issue of New Ordinary Shares at an issue price of 88 per New Ordinary Share.

The Issue Price of 88 pence per New Ordinary Share represents a 39.7 per cent. discount to the Closing Price for an Existing Ordinary Share of 146 pence on 15 May 2014 (being the latest practicable date prior to the publication of this announcement) and a 33.4 per cent. discount to the theoretical ex‐rights price calculated by reference to the Closing Price.

The purpose of the Rights Issue is to provide the Company with funds to support a capital investment programme to improve productivity, reduce operating costs, repay certain of the Group's borrowings and to strengthen the Company's balance sheet and working capital flexibility. These measures will enhance the Group's competitiveness via increased commercial optionality within both its current core markets and broader complimentary modular fabrication sectors.

Principal terms of the Rights Issue

The Company is proposing to raise approximately £71.6 million (US$120.3 million), by way of the Rights Issue of 81,363,469 New Ordinary Shares. The Issue Price of 88 pence per New Ordinary Share, which is payable in full on acceptance by not later than 11.00 a.m. on 25 June 2014, represents a 39.7 per cent. discount to the Closing Price and a 33.4 per cent. discount to the theoretical ex-rights price calculated by reference to the Closing Price.

Subject to the fulfilment of, amongst others, the conditions set out below, the Company will offer New Ordinary Shares by way of the Rights Issue to Qualifying Shareholders (other than, subject to certain exemptions, Excluded Overseas Shareholders) on the basis of:

5 New Ordinary Shares for every 16 Existing Ordinary Shares

held at 6.00 p.m. on the Record Date and so in proportion to any other number of Ordinary Shares then held and otherwise on the terms and conditions set out in the Prospectus and, in the case of Qualifying non-CREST Shareholders, the Provisional Allotment Letter. Holdings of Ordinary Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating entitlements under the Rights Issue. Fractional entitlements to New Ordinary Shares will not be allotted to Qualifying Shareholders and, where necessary, entitlements will be rounded down to the nearest whole number of New Ordinary Shares. New Ordinary Shares representing fractional entitlements will not be allotted to Qualifying Shareholders but will be aggregated and, if possible, sold in the market as soon as practicable after the commencement of dealings in the Nil Paid Rights. The net proceeds of such sales (after deduction of expenses) will be aggregated and will ultimately accrue for the benefit of the Company, save that Qualifying Shareholders will receive any proceeds in respect of fractional entitlements with a value of £5.00 or more. Accordingly, Qualifying Shareholders with fewer than 4 Existing Ordinary Shares will not be entitled to any New Ordinary Shares.

The New Ordinary Shares will, when issued and fully paid, rank pari passu in all respects with the Ordinary Shares, including the right to all future dividends and other distributions declared, made or paid.

The Rights Issue has been fully underwritten by J.P. Morgan Cazenove and HSBC and is conditional, amongst other things, upon:

(a) the passing of the Resolutions (without amendment) at the Extraordinary General Meeting;

(b) the Company having applied to Euroclear UK & Ireland for admission of the Nil Paid Rights and the Fully Paid Rights to CREST as participating securities and no notification having been received from Euroclear UK & Ireland on or before Admission that such admission or facility for holding and settlement has been or is to be refused;

(c) Admission becoming effective by not later than 8.00 a.m. on 11 June 2014 (or such later time and/or date as the Company and the Sole Global Co-ordinator may agree, being not later than 8.00 a.m. on 25 June 2014); and

(d) the Underwriting Agreement becoming unconditional in all respects (save for the condition relating to Admission having occurred) and not having been terminated in accordance with its terms.

Applications will be made to the FCA for the New Ordinary Shares to be admitted to the premium listing segment of the Official List and to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on the Main Market. It is expected that Admission will become effective and dealings (for normal settlement) in the New Ordinary Shares will commence, nil paid, at 8.00 a.m. on 11 June 2014.

It is expected that the Provisional Allotment Letters will be despatched on 10 June 2014, after the Extraordinary General Meeting.

Background to the Rights Issue

The Group encountered a number of operational and financial issues in the financial year ended 31 December 2012, which resulted in a reported loss for the year of US$111.2 million and a decreased revenue to US$1,025.9 million for the year. These issues were a result of operational difficulties and delays in a number of projects, in particular the wind farm installation vessels Windcarrier 1 "Brave Tern" and Windcarrier 2 "Bold Tern" and the Caspian Sea jack-up project. The most notable consequences to have arisen from these difficulties were the Group's inability to meet the covenants under the 2011 Facilities Agreement, forcing Lamprell to seek waivers from its lenders and ultimately to renegotiate, and in due course replace, those facilities; further, the Group was subjected to an investigation by the FSA, the predecessor of the FCA, for failing in its obligations as a listed company to keep the market informed in a timely manner of the Group's deteriorating financial position during early 2012. The Board took a number of decisive steps in response to these difficulties, namely:

· the Board made changes to the senior leadership team in October 2012;

· the Company's Interim Chief Executive Officer commenced a thorough operational and business review and a focus on delivering the problematic projects;

· the Group co-operated fully with the FSA, the predecessor of the FCA, with a view to a swift conclusion of its investigation;

· the Group proactively entered into negotiations with its lenders to obtain waivers for the covenant breaches, and to secure a broader refinancing of the Group's debts; and

· the Group adopted a "Back to Basics Strategy" in 2013.

Reasons for the Rights Issue

The Directors have carefully considered the Group's improved execution performance in 2013 and the management team's proposed strategy and firmly believe that an opportunity exists to implement a programme of automation, productivity improvement and cost reduction to enable the Group to leverage off its current strong position in its core markets, in particular the new build jack-up rigs and offshore construction markets, and to differentiate the Group from many of its competitors by offering its customers a solution for new build rigs which combines high build quality, world class safety, timely delivery as well as additional commercial optionality, without compromising its reputation for or commitment to achieving world class standards of quality and safety.

In addition, a stronger balance sheet will provide the Group with the ability to offer more flexible commercial terms to its clients whilst also enabling it to pursue a more sustainable and competitive long term debt structure.

New build jack-up rigs and offshore construction

Although the Group's labour rates are competitive, there is still significant opportunity for improvement in productivity through improved material flow, newer automated facilities and improved fabrication processes which have been adopted in the modern European and Asian fabrication facilities. The vast majority of the component parts of jack-up project are relatively standard, irrespective of the customer's ultimate specification for the rig. As such, there is a high repeatability of much of the high man-hour intensive work, such as leg fabrication, hull panels, piping, blasting and painting which lends itself to greater automation than currently employed whilst maintaining the Group's high levels of quality.

The Directors anticipate that improving key critical aspects of these processes will lead to increased utilisation from some of the facilities and improved scheduling security in turn leading to greater overall productivity and efficiency from the facilities. The Directors expect that these improvements will make the Group's offering more attractive to its clients and anticipate that the ensuing productivity gains will also improve the Group's margins on its contracts. The combination of these factors, as well as the ability to provide funding and bonding availability to its customers, will enable the Group to deliver greater volume and value from the new build jack-up market whilst working to balance the Group's project portfolio.

The Directors believe that the combination of these factors, and the working capital flexibility discussed below, is sufficient to enable the Group to increase its jack-up rig activity, and therefore maintain and build on the contribution of this core value stream.

Debt facilities

The Directors have considered carefully the funding requirements of the Group and the funding alternatives most readily available to the Group. The Directors believe that it is essential for the Group to secure the optimum capital structure to enhance future growth prospects. The Rights Issue is an important part of strengthening the Group's capital structure and the Company announced today in its interim management statement that it had signed a conditional commitment letter and detailed heads of terms (being the Commitment Letter, scheduling the Term Sheet) for the arrangement of new secured, and, with the exception of the Bonding Facility (defined below), fully underwritten banking facilities with three core lending banks. This arrangement will provide the Group with improved working capital flexibility and improved covenant levels and amortisation schedule, whilst also significantly reducing the Group's funding costs, including interest costs, guarantee fees and bonding costs on projects. The Directors believe that this arrangement will enhance the Group's future growth prospects and will provide more favourable access to guarantees and bonding facilities.

The new US$350.0 million facility arrangement is comprised of a US$100.0 million term loan ("Facility A"), a US$50.0 million revolving credit facility to be used for working capital purposes ("Facility B1"), and a US$200.0 million revolving credit facility to be used for funding contract awards ("Facility B2" and, together with Facility A and Facility B1, the "New Facilities"). Furthermore, the lending banks have agreed to use best efforts to arrange a further US$250.0 million bonding facility to be used in connection with contract awards funded under Facility B2 (the "Bonding Facility"). The lending banks have committed to providing a portion of the intended US$250.0 million Bonding Facility. The New Facilities and the Bonding Facility are scheduled to mature five years from the date upon which the facilities agreement is entered into to document the New Facilities and the Bonding Facility.

The New Facilities, once fully unconditional and committed, will replace the Existing Facilities under the Senior Secured Syndicated Facilities Agreement, and, together with the Bonding Facility, will sit alongside the continuing bilateral unfunded facilities, which are used for the issue of bonds and guarantees. This arrangement is subject to the completion of the Rights Issue on the terms set out in the Prospectus, as well as entry into final documentation and a number of conditions precedent, which are expected to be completed in the third quarter of 2014. If the Rights Issue did not complete for any reason, the Existing Facilities would remain available to the Group.

The Directors believe that, taken together with the net proceeds of the Rights Issue, such a refinancing will provide the Group with a more cost effective and sustainable capital structure and deliver enhanced working capital availability, which would enable the Group to access a larger addressable market and support additional project wins.

The Existing Facilities referred to above currently provide the Group with essential funding, however, the initial margin in respect of the US$10.6 million which represents the balance of term loan facility B, following the Inspec Disposal and the pre-payment of US$49.5 million made by the Group after that disposal, is 8 per cent. plus LIBOR per annum and is subject to gradual increases commencing from 1 July 2014, reaching a maximum of 14 per cent. plus LIBOR per annum. The Directors consider this margin to be expensive; furthermore, while the balance under term loan facility B remains outstanding, the Company is restricted under the Senior Syndicated Secured Facilities Agreement from paying dividends to Shareholders. Accordingly, the New Facilities will replace Existing Facilities and provide the Group with additional working capital flexibility, improved covenant levels and a more flexible amortisation schedule, whilst also significantly reducing the Group's funding costs, including interest costs and guarantee fees. Furthermore, the Directors propose to repay the balance of term loan facility B at the earliest opportunity and intend to do so out of the proceeds of the Rights Issue.

Working capital flexibility and longer term sustainable debt structure

The Group's key differentiators include quality, safety, cost efficiency and close working relationships with clients. However, in today's commercial-focused rig market, working capital flexibility is also an important enabler of future project growth. The use of proceeds, together with the New Facilities (once fully unconditional and committed), will provide the Group with increased working capital flexibility to facilitate access to a wider addressable market and, together with the Bonding Facility, will enable to Group to provide improved funding and bonding terms. The Board is confident that, taken together with the net proceeds of the Rights Issue, the New Facilities will provide the Group with a more cost effective and sustainable capital structure and deliver enhanced working capital availability, which would enable the Group to access a larger addressable market and support additional project wins.

The proceeds of the Rights Issue will, after the application of the funds in the manner referred to below in the section entitled "Use of proceeds", together with the New Facilities, strengthen the Group's balance sheet and provide it with the resources necessary to enable the Group to implement its strategy as referred to below and create opportunities to reduce costs and improve competitiveness and flexibility and the Directors believe that these factors will enable the Group to grow.

Strategy

The Board has carried out a thorough review of the Group's strategy and concluded that the Group's strategy for the short-to-medium term will be to continue to focus on the Group's existing core businesses, namely new build jack-up rigs, offshore construction, renewable and multipurpose liftboats, rig refurbishment and conversion and land rig services. The Group's long term goal is to broaden the Group's offering into related markets, including modular LNG plants and re-entering the FPSO markets where the Group has already been successful and has a strong reputation. In doing this the Directors will leverage the Group's proven expertise in project execution to broaden the Group's client base within these core markets.

Enhanced competitiveness is a key focus for the management team and central to this is the Group's initiatives of productivity and efficiency improvements, focused on driving down costs and making its build schedules more flexible. This will be achieved by investing in new plant and equipment, optimising yard lay-outs and capturing synergies between major projects. The Directors believe that the planned enhancement of the Group's facilities, as well as improving synergies, will deliver significant operational and financial improvements, whilst maintaining the highest standards of safety, quality and client satisfaction. Furthermore, the Directors are creating a culture of continuous improvement, including the use of, and reporting against, key performance indicators and embedding lessons learnt across similar projects.

These enhancements also form part of the Group's above-mentioned strategy of diversifying and strengthening its client portfolio by accessing a broader section of the available market, including major international operators seeking the highest standards of quality whilst benefiting from the cost efficiencies that the Group's facilities bring to their asset investment programmes. The Group's on-going commitment to customer service and close client relations, before, during and after project completion has provided the Company with strong support from its major clients.

Although the group's long term goal is to use its considerable experience and the breadth of its core competencies in order to broaden the Group's offering into new markets aligned to that of its existing offering, including FPSOs and modular LNG plants, the Directors expect the Group to be best served in the medium term by concentrating on extending its client base in its existing core markets, namely new build jack-up rigs, offshore construction, renewable and multipurpose liftboats, rig refurbishment and conversion, and land rig services, and leveraging the Group's key strengths, including its high standards of safety and quality, reliability of delivery and location, to deliver such services to its client's satisfaction.

In addition, the Group has decided that further development of certain of its services businesses will not form part of the Group's strategy going forward. As announced on 3 March 2014, the Company reported that it had completed the sale of Inspec for US$66.2 million, and confirmed that the Group will continue with the process to sell other non-core businesses, if acceptable terms can be obtained. The Inspec Disposal therefore represents a key step towards implementing this part of the Group's strategy. The process for the disposal of the other services businesses is on-going. The sale of these services businesses may not proceed if acceptable terms cannot be agreed but neither the Group nor its strategy is dependent on any such sales taking place or on realising sale proceeds from these businesses.

Use of proceeds

The Rights Issue will raise gross proceeds of approximately £71.6 million (US$120.3 million). After the payment of fees and expenses of approximately £4.8 million (US$8.1 million) in connection with the Rights Issue, the Company intends to use the net proceeds of the Rights Issue as follows:

· US$60.0 million will be used for a yard investment programme, including a new panel line, newer welding processes, an improved electrical distribution system and improved cutting and blasting and painting facilities, as well as supporting operational systems, with an expected payback period of three to four years;

· US$10.6 million will be used to repay in full the borrowings under term loan facility B, after the repayment of US$ 49.5 million out of the proceeds of the Inspec Disposal; and

· the balance will be used, together with the New Facilities (once fully unconditional and committed), to strengthen the Group's balance sheet by providing it with a more cost effective and sustainable capital structure to enhance the Group's working capital flexibility.

Financial effects of the Right Issue

The Rights Issue will provide the Group with significantly improved financial flexibility. It will allow the repayment in full of the borrowings under term loan facility B and, together with the New Facilities (once fully unconditional and committed), will reduce the Group's funding costs, including interest and guarantee fees. The New Facilities and the Bonding Facility are conditional on, amongst other things, the completion of the Rights Issue on the terms set out in the Prospectus. Furthermore, the Rights Issue, together with the New Facilities (once fully unconditional and committed), will provide the Group with increased flexibility to facilitate access to a wider addressable market by providing improved productivity and efficiency and enhance project performance. The Rights Issue is expected to be earnings accretive for the Group over the medium-term.

Current Trading and Prospects

The Directors believe that the Group has performed well since the start of the year, building on the operational successes in 2013. Lamprell has delivered two major projects during the relevant period in line with expectations, on schedule and on budget.

Lamprell successfully completed the "Qarnin" jackup rig, a LeTourneau Super 116E (Enhanced) with a self-elevating design, to the Group's largest client, National Drilling Company, in February 2014. The project represented the 15th new build jack-up rig that Lamprell has successfully delivered since its IPO in 2006.

In April 2014, the Group delivered the 13,000 plus tonne production, utilities and quarters ("PUQ") deck to Nexen as part of the Golden Eagle Area Development in the North Sea. Lamprell's safety record on the combined Nexen project (namely the wellhead platform delivered in June 2013 and the PUQ deck) was world class, having reached a milestone of ten million man-hours without a lost time incident. In delivering this project, Lamprell successfully achieved a world record for the heaviest load moved by self-propelled modular trailers.

Three further new build jack-up rigs, one liftboat and two offshore platforms, as well as the largest rig conversion and refurbishment project in Lamprell's history, are scheduled to be delivered by the Group in 2014 and all are currently proceeding according to plan and on budget.

The Group has seen a strong demand for its products and services in its core markets, as demonstrated recently by the Group securing a major order with a world leading drilling contractor, Ensco, for two 116E high specification jack-up rigs with two options (to be exercised within six months of contract award). The contract value is approximately US$390 million excluding the options. Although Ensco is an existing customer of the Group's rig refurbishment business, this was the first new build jack-up order from Ensco which reinforces the Group's capabilities as a high quality fabricator with a reputation for safety and reliable delivery.

Whilst market conditions remain competitive and delays in construction project awards continue to be a feature of the industry, the Group's order book is healthy and bid pipeline is substantial, particularly in the jack-up rig market.

Consistent with the Group's strategy and as announced on 3 March 2014, the Company entered into an agreement to sell the non-core "Inspec" service business for US$66.2 million. This resulted in the early repayment of a substantial part of the high cost portion of the Group's existing debt facility.

Dividend and Dividend Policy

The Company did not declare a dividend for the financial year ended 31 December 2013.

Whilst the proposed repayment of the balance of term loan facility B under the Senior Secured Syndicated Facilities Agreement will remove the current restriction under the facilities agreement on the payment of dividends by the Company to Shareholders while the term loan is outstanding, the Directors do not currently anticipate that the Company will pay a final dividend in the current financial year ending 31 December 2014. However, the Directors remain optimistic about the future of the Group and will seek to review and restore the payment of a dividend at the most appropriate time.

Extraordinary General Meeting

An Extraordinary General Meeting will be held at 15th Floor, Rolex Tower, Sheikh Zayed Road, Dubai, United Arab Emirates, on 10 June 2014 at 1.00 p.m. (UAE time), notice of which is set out in the Prospectus. The purpose of this meeting is to consider and, if thought fit, pass the Resolutions, in each case as set out in the notice of Extraordinary General Meeting:

Resolution 1 and resolution 2 (together the "Resolutions") authorise the Directors to allot shares for cash and grant rights to subscribe for, or convert any security into, shares for cash up to an aggregate nominal amount of £4,068,174 in connection with the Rights Issue, representing approximately 31.3 per cent. of the existing issued share capital of the Company, as if the pre-emption provisions in article 5.2 of the Articles did not apply to such allotment. The authorities and powers conferred by the Resolutions are to be supplementary to the authorities to be granted at the Company's Annual General Meeting to be held on 10 June 2014 at 10.00 a.m. (UAE time). The Directors intend to use the authorities granted at the Extraordinary General Meeting to allot New Ordinary Shares pursuant to the Rights Issue. Other than in connection with the Rights Issue, and upon the exercise of options under the Share Option Plans, the Directors have no present intention to utilise these authorities.

The Principal Shareholder's Intentions

The Principal Shareholder, which holds Ordinary Shares representing approximately 33.1 per cent. of the ordinary share capital of the Company as at 15 May 2014 (being the latest practicable date prior to the publication of this announcement), has irrevocably undertaken to vote the Ordinary Shares over which it exercises voting control (representing approximately 33.1 per cent. of the ordinary share capital of the Company as at 15 May 2014 (being the latest practicable date prior to the publication of this announcement)) in favour of the Resolutions and intends to take up (or procure the taking up of) its entitlement to New Ordinary Shares in full.

Lamprell Directors' Intentions 

The Directors currently beneficially own, in aggregate, 1,667,272 Ordinary Shares representing, in aggregate, approximately 0.6 per cent. of the ordinary share capital of the Company as at 15 May 2014 (being the latest practicable date prior to the publication of this announcement) and intend to vote in favour of the Resolutions, and currently intend to take up (or procure the taking up of) their entitlement to New Ordinary Shares in full.

Recommendation

The Board, which has received financial advice from Rothschild as financial adviser, considers the Resolutions to be in the best interests of the Company and Shareholders as a whole. In providing advice to the Board, Rothschild has relied on the Directors' commercial assessment of the Rights Issue.

Accordingly, the Board recommends that you vote in favour of the Resolutions to be proposed at the Extraordinary General Meeting as the Directors and persons connected to them intend to do in respect of their entire holdings.

Expected timetable of principle events

Each of the times and dates in the table below is indicative only and may be subject to change. Please read the notes for this timetable set out below.

Notes:

(1) References to times in this announcement are to time in London, United Kingdom unless otherwise stated.

(2) The times and dates set out in the expected timetable of principal events above and mentioned in this announcement, the Prospectus and the in the Provisional Allotment Letters are indicative only and may be adjusted by the Company with the agreement of the Banks, in which event details of the new dates will be notified to the FCA, the London Stock Exchange and, where appropriate, Qualifying Shareholders.

(3) Subject to certain restrictions relating to Qualifying Shareholders with registered addresses outside the UK, details of which are set out in the Prospectus.

DEFINITIONS

IMPORTANT NOTICE

This announcement has been issued by and is the sole responsibility of Lamprell plc (the "Company"). A copy of the Prospectus when published will be available from the registered office of the Company and on the Company's website at www.lamprell.com provided that the Prospectus will not, subject to certain exceptions, be available (whether through the website or otherwise) to Qualifying Shareholders in the Excluded Territories. Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this announcement.

The Prospectus will give further details of the New Ordinary Shares, the Nil Paid Rights and the Fully Paid Rights being offered pursuant to the Rights Issue.

This announcement is not a Prospectus but an advertisement and investors should not subscribe for or acquire any Nil Paid Rights, Fully Paid Rights or New Ordinary Shares referred to in this announcement except on the basis of the information contained in the Prospectus. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. The information in this announcement is subject to change.

This announcement is for information purposes only and is not intended to and does not constitute or form part of any offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for, Nil Paid Rights, Fully Paid Rights or New Ordinary Shares or to take up any entitlements to Nil Paid Rights in any jurisdiction in which such an offer or solicitation is unlawful.

The distribution of this announcement and/or the Prospectus and/or the Provisional Allotment Letter and/or the transfer of Nil Paid Rights, Fully Paid Rights and/or New Ordinary Shares into jurisdictions other than the United Kingdom may be restricted by law, and, therefore, persons into whose possession this announcement and/or the Prospectus and/or the Provisional Allotment Letter comes should inform themselves about and observe any such restrictions. Any failure to comply with any such restrictions may constitute a violation of the securities laws of such jurisdiction.

In particular, the information contained in this announcement is not for release, publication or distribution, in whole or in part, directly or indirectly, to persons in the United States, Australia, Canada, Japan, the Republic of South Africa or any other jurisdiction where it would be unlawful and should not be distributed, forwarded to or transmitted in or into any jurisdiction where to do so might constitute a violation of local securities laws or regulations.

This announcement does not constitute or form part of an offer or solicitation to purchase or subscribe for securities of the Company in the United States. None of the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares nor the Provisional Allotment Letters have been or will be registered under the United States Securities Act of 1933, as amended (the ''US Securities Act''), or under the applicable securities laws of any state or other jurisdiction of the United States or the securities legislation of any province or territory of Australia, Canada, Japan or the Republic of South Africa. Accordingly, the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares or the Provisional Allotment Letters may not be offered, sold, resold, delivered or distributed, directly or indirectly, in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with state securities laws, or in or into Australia, Canada, Japan or the Republic of South Africa except in accordance with applicable law. There will be no public offer of Nil Paid Rights, Fully Paid Rights, New Ordinary Shares or the Provisional Allotment Letters in the United States, Australia, Canada, Japan or the Republic of South Africa.

This announcement does not constitute a recommendation concerning the Rights Issue. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this announcement are not to be construed as legal, business, financial or tax advice. Each Shareholder or prospective investor should consult his, her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.

This announcement contains or incorporates by reference "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "projects", "expects", "intends", "aims", "plans", "predicts", "may", "will", "seeks", "could", "would", "shall" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts and include statements regarding the intentions, beliefs or current expectations of the Board concerning, among other things, the Company's results of operations, financial condition, prospects, growth, strategies and the industries in which the Group operates. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future or are beyond the Group's control. Forward-looking statements are not guarantees of future performance and are based on one or more assumptions. The Group's actual results of operations and financial condition and the development of the industries in which the Group operates may differ materially from those suggested by the forward-looking statements contained in this announcement. In addition, even if the Company's actual results of operations, financial condition and the development of the industries in which the Group operates are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments. The forward-looking statements contained in this announcement speak only as of the date of this announcement.

J.P. Morgan Securities plc (which conducts its UK investment banking business as J.P. Morgan Cazenove) ("J.P. Morgan Cazenove"), HSBC Bank plc ("HSBC") and N.M. Rothschild & Sons Limited ("Rothschild"), all of whom are authorised by the PRA and regulated by the FCA and PRA, are acting for the Company and for no-one else in connection with the Rights Issue and will not be responsible to anyone (whether or not a recipient of this announcement) other than the Company for providing the protections afforded to its clients or for providing advice in connection with the Rights Issue or any other matter referred to herein.

Apart from the responsibilities and liabilities, if any, which may be imposed on J.P. Morgan Cazenove, HSBC and Rothschild by FSMA nor the regulatory regime established thereunder, none of J.P. Morgan Cazenove, HSBC and Rothschild accepts any responsibility or liability whatsoever or makes any representation or warranty, express or implied, for or in respect of the contents of this announcement, including its accuracy, completeness or verification (or whether any information has been omitted from the announcement) or for any other information or statement made or given or purported to be made by it, or on behalf of it, in connection with the Company, the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares or the Rights Issue, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection. Nothing in this announcement is, or shall be relied upon as, a promise or representation in this respect, whether as to the past or future. J.P. Morgan Cazenove, HSBC and Rothschild accordingly disclaims all and any liability whatsoever, whether arising in tort, contract or otherwise (save as referred to above), which it might otherwise have in respect of this announcement.

In connection with the Rights Issue, each of J.P. Morgan Cazenove, HSBC and any of their respective affiliates, acting as investors for their own accounts, may subscribe for or purchase Nil Paid Rights, Fully Paid Rights or New Ordinary Shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Nil Paid Rights, Fully Paid Rights or New Ordinary Shares and other securities of the Company or related investments in connection with the Rights Issue or otherwise. Accordingly, references in the Prospectus, once published, to the Nil Paid Rights, Fully Paid Rights or New Ordinary Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, each of J.P. Morgan Cazenove, HSBC and any of their respective affiliates acting as investors for their own accounts. J.P. Morgan Cazenove, HSBC do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

The Company, J.P. Morgan Cazenove, HSBC and Rothschild expressly disclaim any obligations or undertaking to update or revise publicly any statements in this announcement, whether as a result of new information, future events or otherwise, unless required to do so by applicable law, the Prospectus Rules, the Listing Rules, the London Stock Exchange Rules or the Disclosure and Transparency Rules.