This acquisition follows the acquisition of Invensys Advanced Building Systems completed in July 2005 and will be very complementary with Schneider Electric's building automation platform. IBS generated revenues of $142 million for the fiscal year ended March 31, 2006, with operating profit of $20 million. The company is a leading provider of building automation products and services in North America with interesting positions in Asia. IBS has over 100 years of experience in the industry and benefits from excellent reputation and strong brands such as Barber-Colman and Com-Trol.

The market of building automation and control systems represents significant growth potential for Schneider Electric. The acquisition of TAC in June 2003 enabled Schneider Electric to become a major player in building automation. The subsequent merger between TAC and Andover Controls, acquired in July 2004, and the acquisition of ABS EMEA in July 2005, further re-enforced Schneider Electric's position, both in Europe and in the US. The IBS acquisition will bring significant revenue and cost synergies, renowned brands, leading distribution channels and an experienced management team. IBS will significantly enlarge TAC's installed base, expand its distribution capability in North America and Asia and bring the Schneider Electric Building Automation platform to a new scale.

IBS' acquisition fits perfectly with Schneider Electric's growth strategy developed over the last three years. Jean-Pascal Tricoire, CEO of Schneider Electric, commented: "IBS North America and Asia fits logically and naturally in our building automation platform. TAC and IBS teams will be joining forces to grow their business on a global scale, and to bring increased benefits to their customers."

Subject to regulatory approvals, Schneider Electric will pay $296 million in cash to acquire 100% of the IBS business on a cash-free debt-free basis and to obtain the benefit of a 338 (h)(10) U.S. tax election, which has a total net present value of around $60m. This transaction will meet Schneider Electric's acquisition criteria (Return on Capital Employed in year three).