Sale Agreement Signed

RNS Number:8754T
Marconi Corporation PLC
05 January 2004


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                            MARCONI CORPORATION PLC

          SALE OF NORTH AMERICAN ACCESS BUSINESS UNIT AGREEMENT SIGNED

            $240 million (approximately #135 million) cash proceeds

London - January 5, 2004 - Marconi Corporation plc (London: MONI; Nasdaq: MRCIY)
today announces the execution of a definitive agreement for the sale of its
North American Access business to Advanced Fibre Communications, Inc. (AFC)
(Nasdaq: AFCI) for a total consideration of $240 million (approximately #135
million) in cash. The transaction is subject to regulatory review and other
customary closing conditions. Completion is expected in the first calendar
quarter of 2004.

Upon completion, and pursuant to the terms of Marconi's Junior and Senior
Secured Notes, the total gross proceeds will be transferred to Marconi's
Mandatory Redemption Escrow Account (MREA) and will be used to fund a further
mandatory redemption of the Group's Secured Notes.

Marconi and its affiliates will retain all liabilities for pension obligations,
with respect to North American Access employees. As a result, pursuant to a
Memorandum of Understanding with the Pension Benefit Guaranty Corporation,
Marconi will make contributions to the U.S. pension plans in an estimated amount
of approximately $8 million (c. #5 million) after the transaction closes. The
actual required contributions may vary from the estimate due to changes in the
plan liabilities, the value of plan assets, and the actuarial assumptions
required to be used to determine the actual contribution amount.

Marconi's North American Access business recorded sales of approximately #55
million and an operating profit, before goodwill amortisation and exceptional
items, of approximately #3 million, in the six months ended 30 September 2003.
Net assets being acquired amounted to #10 million at 30 September 2003. Of the
#541 million of goodwill on Marconi's balance sheet at 30 September 2003, #54
million related to the North American Access business.

Commenting on the transaction, Mike Parton chief executive of Marconi
Corporation plc, said: "We are delighted with this transaction, which is in line
with our previously stated strategy to sell our North American Access business.
The transaction will provide business continuity to the employees and customers
of our North American Access activity. The purchase price reflects the business'
strong technological heritage, solid customer base and significant operational
performance improvements achieved over the last 12 months. The cash proceeds
will enable us to continue to reduce group debt and the associated interest
payments."

John Schofield, chairman, president and CEO at AFC, said: "This acquisition
brings together two companies with long histories of success within the highly
competitive access networking market. Collectively, AFC and North American
Access possess a significant deployed base of field-proven broadband access
solutions. We view the product lines from both companies to be complementary and
intend to continue and enhance both to best serve a broad customer base.

"Over the past year, North American Access' leadership team successfully
streamlined its business and demonstrated the ability to regain and sustain
profitability," added Schofield. "Based on the current profile of the business,
we expect this acquisition to be accretive to AFC's earnings and cash flow in
2004, excluding acquisition-related charges."

JPMorgan acted as lead advisor to Marconi Corporation plc on the transaction.

ENDS/...


About Marconi Corporation plc
Marconi Corporation plc is a global telecommunications equipment, services and
solutions company. The company's core business is the provision of innovative
and reliable optical networks, broadband routing and switching and broadband
access technologies and services. The company's customer base includes many of
the world's largest telecommunications operators.

The company is listed on the London Stock Exchange under the symbol MONI and on
the Nasdaq under the symbol MRCIY. Additional information about Marconi
Corporation can be found at www.marconi.com.

About the Mandatory Redemption Escrow Account (MREA)
When the balance of the MREA reaches US$30 million, this triggers a mandatory
partial redemption of Marconi's Loan Notes at 110 per cent of par value.

About AFC
Headquartered in Petaluma, Calif., Advanced Fibre Communications, Inc. is a
leading provider of broadband access solutions for the global telecommunications
industry. With a customer base of more than 800 service providers worldwide, AFC
continues to build and support the world's evolving broadband access network
architecture. Advanced Fibre Communications, Inc., AFC, and the AFC logo are
registered trademarks of Advanced Fibre Communications, Inc. Copyright 2004. All
rights reserved. Any other trademarks are the property of their respective
owners. For more information, please visit AFC online at www.afc.com or call
1-800-690-AFCI.

Copyright (c) 2003 Marconi Corporation plc. All rights reserved. All brands or
product names are trademarks of their respective holders.

This press release contains forward-looking statements with respect to products,
partners, customers, future growth and other matters. Please refer to the Form
20-F report, our Form 10Q and Form 6-K reports filed by Marconi Corporation plc
with the United States Securities and Exchange Commission for a discussion of
risks that could cause actual results to differ materially from such statements.

Exchange rate at 30 September 2003: #1 = $1.6614
Exchange rate at 5 January 2004: #1 = $1.8093



                      This information is provided by RNS
            The company news service from the London Stock Exchange

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