Eaton Announces Integration Plans for Delta's Electrical Division.

Business Editors

CLEVELAND--(BUSINESS WIRE)--April 2, 2003

Diversified industrial manufacturer Eaton Corporation (NYSE:ETN) today announced plans to integrate the former electrical division of Delta plc into Eaton's Industrial and Commercial Controls business.

"The integration of Delta's electrical operations with Eaton's Industrial and Commercial Controls business will strengthen our ability to support our multinational customers," said Randy W. Carson, senior vice president and group executive. "The former Delta operations will become an integral part of our worldwide electrical business, adding well-recognized brands and distribution networks within key European and Asian markets."

Eaton plans to consolidate five facilities into other locations as part of the integration process. Both Delta and Eaton locations will be affected. Currently, there are about 1,700 employees in the affected locations. The number of positions actually being eliminated or moved to other locations will not be known until consolidation plans are finalized.

The plans will be finalized after Eaton informs and consults with the relevant trade unions, works councils and other worker representative bodies about its proposals, as required by labor laws in the countries involved.

Eaton completed the purchase of the electrical division of Delta plc on January 31, 2003. Through the acquisition, Eaton broadened its global electrical product portfolio to include Delta's major electrical brands such as MEM(R), Holec(TM), Bill(TM), Home Automation(TM), Elek(TM), and Tabula(TM). The purchase also increased Eaton's geographic presence in Western Europe, the Middle East, China and Southeast Asia.

The consolidation plans include the following:

-- Operations at Delta's former Chippenham, UK facility will be

outsourced or moved to the Chadderton, UK facility.

-- Existing assemblies manufacturing operations at Eaton's Ottery

St. Mary, UK facility will be consolidated into two other

facilities. These are Delta's former Reddings Lane, UK and

Hengelo, Netherlands facilities. The components warehouse

operations at Ottery St. Mary will eventually be moved to

another location as well.

-- The former Delta distribution and manufacturing facilities in

Australia will be combined with Eaton operations in Mascot,

Australia.

-- Delta's former Holec low-voltage manufacturing operations in

Hengelo, Netherlands will be consolidated into the

medium-voltage manufacturing facility in Hengelo.

-- The Low Voltage Systems operation at Delta's former Premier

Street, UK facility will be integrated into the Reddings Lane,

UK facility. The majority of the employees will have the

opportunity to continue working at the Reddings Lane facility.

This integration had been previously announced by Delta.

"Once our plans are finalized, we will act with care and concern for all of the individuals affected," said Carson. "Our plans are the result of extensive and careful study of the various production capabilities, processes and capacity of all facilities. We expect to complete the majority of the consolidation plans by the end of the year and will continue to meet our customer commitments during the transition."

Eaton employees received the news today in meetings with senior management. Employees will receive prior notice of any workforce reductions or employment transfers, in compliance with local employment laws. Severance packages, including career transition services, will be provided to all eligible employees.

Eaton Corporation is a global $7.2 billion diversified industrial manufacturer that is a leader in fluid power systems; electrical power quality, distribution and control; automotive engine air management and fuel economy; and intelligent drivetrain systems for fuel economy and safety in trucks. Eaton has 51,000 employees and sells products in more than 50 countries. For more information, visit www.eaton.com.