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Electronics Production | September 30, 2005

Belden CDT to restructure European Operations

Belden CDT Inc. announced a restructuring plan that will reduce manufacturing floor space and manufacturing overhead in the Company's European operations in 2006 and will streamline administrative processes in Europe.
The Company has nine manufacturing locations in Europe totaling approximately 2.2 million square feet. About 30 percent of the Company's sales were in Europe in the first six months of 2005, and most of the products sold there are produced locally.

"Having nearly completed the merger integration work we outlined when we announced the merger of Belden and Cable Design Technologies in 2004, we are now turning our attention to additional restructuring in Europe," said C. Baker Cunningham, President and Chief Executive Officer of Belden CDT.

Larrie Rose, president of Belden CDT Europe, said, "We believe that by making significant changes to our product mix, cost structure and the way we conduct our business, we can achieve a level of profitability in Europe that will contribute significantly to Belden CDT's value in the long run. We plan to: become a leaner, more responsive organization; focus on the most valuable markets for cable and connectivity; concentrate our manufacturing and sourcing in lower-cost regions; and retain our distinctive capabilities."

"The number of employees impacted by the restructuring will be significantly affected by the outcome of discussions that are still continuing with British Telecom plc (BT) regarding our copper cable contract with them," said Mr. Cunningham. "Given our intent to focus on opportunities that offer better growth prospects and profit potential, we are reexamining our participation in the U.K. copper telecom cable market," said Mr. Cunningham. "This business provided reasonably satisfactory profit contribution in the past, but looking forward we view the copper telecom market as extremely mature, with falling demand, excess capacity, and continuing price pressure. For this reason, we are considering alternatives for our U.K. telecom business and our Manchester, U.K. operations." The Manchester operations had revenue of $50.2 million in the first half of 2005, with over 90 percent of that revenue from BT, the Company said.

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