Exel Acquires Power Packaging Inc.

Supply chain management provider expands supply chain services to existing, new customers

London, UK — January 6, 2005 — Exel, a supply chain management provider, today announced that it has exercised an option to acquire Power Packaging Inc., a contract manufacturer servicing branded food and beverage companies in the United States and Canada, from existing management.

Power Packaging has net assets of US$43 million. The acquisition supports Exel's objective of expanding supply chain services to existing and new customers.

In September 2002, Exel acquired several Power Logistics operations in the United States and United Kingdom to provide supply chain management and secondary packaging (also known as contract packaging) services to consumer product manufacturers in support of retailers' packaging and display needs. At that time, Exel entered into an option agreement to purchase Power Packaging pending the achievement of certain financial objectives. These objectives have been realized and the acquisition is effective immediately. It is expected that the transaction will be earnings enhancing in 2005.

Power Packaging's operations include primary packaging (also known as contract manufacturing) of branded products in cartons, bags, sticks, pouches, and plastics and glass bottles at nine Food & Drug Administration (FDA) and United States Department of Agriculture approved facilities in the United States and Canada.

According to Exel, the company creates value for customers through responsive manufacturing services and projects requiring site selection, engineering, design and development, information technology (IT) solutions, financing and project management services.

While Power Packaging's operations involve dry foods and beverages, the company's core skills and expertise are transferable to other product categories such as soaps, health and beauty aids, pharmaceuticals and medical devices.

Randy Meridith, the current and continuing president of Power Packaging will report to John Gilbert, Exel's president, Consumer and Healthcare, Americas. Meridith believes the ability to combine manufacturing, packaging and supply chain services into an integrated solution creates value for customers that is unique in the industry. "Now as part of Exel's global service offering, Power Packaging brings industry leading contract manufacturing and packaging capabilities to Exel's current and potential customers."

John Gilbert added, "The ability to store inventory and package it under one roof reduces transportation spending, administrative costs and packaging lead times, resulting in a cost-effective solution that can respond quickly to market changes. This acquisition demonstrates our stated commitment to expand into areas where we can leverage our current and acquired capabilities to deliver new value for our customers."

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