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THE FAILURE GROUP CONSIDERS ACQUISITION OF RISK ANALYSIS FIRM

 MENLO PARK, Calif., July 8 /PRNewswire/ -- The Failure Group Inc. (NASDAQ-NMS: FAIL) and PLG Inc., today announced that the two companies have entered into discussions to allow The Failure Group to purchase all of PLG's privately held stock, establishing PLG as an independent subsidiary.
 The proposed acquisition would be structured in an "earnout" over the next 4 1/2 years. The value of the transaction would range between $3 million and $7.5 million depending on PLG's performance during the earnout period.
 The proposal would allow The Failure Group to use PLG's established expertise in risk management and analysis to broaden its own capabilities in that field and to complement its existing reputation as the nation's leading consulting firm devoted to the investigation of accidents and failures.
 At the same time, PLG would benefit from The Failure Group's existing capabilities in utility and power plant services and be able to utilize its extensive database resources.
 "This proposed acquisition is a logical step for us," said Michael R. Gaulke, president of The Failure Group, "one that will allow us to provide our clients a full range of services in failure prevention and failure analysis."
 Dr. B. John Garrick, president and chief executive officer of Newport Beach, Calif.-based PLG, said, "We're excited about the possibility of our engineers and scientists being able to utilize The Failure Group's comprehensive analytical resources to expand our services to a wider group of industries."
 Consummation of the transaction is subject to a number of conditions, including negotiation of a definitive acquisition agreement.
 PLG, with 1992 net revenues of $10.3 million and additional offices in Washington D.C. and Encinitas, Calif., is a privately held engineering, applied science and management consulting firm. Founded 36 years ago, PLG's areas of expertise include quantitative risk management and analysis, decision analysis, systems engineering and analysis, nuclear engineering, environmental engineering, power plant engineering and the management sciences.
 The Failure Group, through its principal operating subsidiary, Failure Analysis Associates Inc., is the leading independent consulting firm devoted primarily to the investigation, analysis and prevention of failures of an engineering or scientific nature. Founded in 1967, the company, which recently reported revenues of $65.4 million for fiscal 1993, operates nine domestic and five international offices and is headquartered in Menlo Park.
 -0- 7/8/93
 /CONTACT: Michael R. Gaulke, president of The Failure Group, 415-326-9400; or Dr. B. John Garrick, president and CEO of PLG, 714-833-2020/
 (FAIL)


CO: The Failure Group Inc.; PLG Inc. ST: California IN: SU: TNM

MF-JL -- LA017 -- 9315 07/08/93 08:01 EDT
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Publication:PR Newswire
Date:Jul 8, 1993
Words:428
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