BHA Group Holdings, Inc. Announces the Sale of the Assets of Allergydirect.com to Salu, Inc.

Business Editors

KANSAS CITY, Mo.--(BUSINESS WIRE)--Oct. 2, 2000

BHA Group Holdings, Inc. (Nasdaq:BHAG) today announced that on September 29, 2000, its wholly owned subsidiary, BHA Technologies, Inc. (BHA Technologies), completed the sale of the assets of its Allergydirect.com division to Salu, Inc. (Salu).

Simultaneously with the close of the transaction, the parties have entered into a multi-year agreement for the supply of ePTFE membrane allergy avoidance bedding encasements by BHA Technologies to Salu. Salu, a leader in the specialty physician market, has established Internet Hubs across a number of specialties to service a multi-billion dollar market. The Allergydirect.com website and supply agreement for the high-end bedding encasements will be rolled into Salu's Internet Hub that will service the allergy market. Consideration for these transactions includes an upfront payment of cash by Salu to BHA Technologies and the delivery by Salu of warrants to purchase shares of its common stock to BHA Technologies. BHA Group Holdings, Inc. expects that the value of the total consideration received in excess of the net assets transferred will be recognized as income over the exclusivity period under the supply agreement. Stated in terms of the current weighted average number of shares outstanding, the total future income relating to the upfront consideration that will be recognized over the next three fiscal years will be in the range of $.04 to $.07 per diluted share.

James E. Lund, President and Chief Executive Officer of BHA Group Holdings, Inc., said: "I'm pleased to announce the relationship BHA has established with Salu. This transaction is further confirmation of BHA Technologies' strategy to establish key supply agreements for the broad distribution of its high-end products with the major players in its target markets. We believe that Salu has an excellent business model for providing products and services to physicians and patients in the allergy marketplace. We also believe that our product, an ePTFE membrane bedding encasement, represents the single best avoidance product for allergy sufferers. The synergies between the two companies create tremendous opportunity for both parties to achieve the mutual goal of broad-based distribution of the best available product to the allergy market."

BHA Group Holdings, Inc. is a world leader in innovative filtration technology. Its two principal operating subsidiaries are BHA Group, Inc., the world's largest supplier of replacement parts and services for industrial air pollution control systems, and BHA Technologies, Inc., which manufactures and markets expanded polytetrafluoroethylene (ePTFE) membrane products for use in a variety of industrial and consumer products.

This press release contains forward-looking statements that reflect the Company's current views with respect to future events and financial performance. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. The words "should," "believe," "anticipate," "expect," and other expressions that indicate future events and trends identify forward-looking statements. Actual future results and trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the performance of newly established domestic and international operations, demand and price for the Company's products and services and other factors. You should also consult the sections entitled "Factors Affecting Earnings and Stock Price" and "Management's Discussion and Analysis," which are included in the Company's report on Form 10-K. The Company assumes no obligation to update the information contained in this press release.