Press Centre

Xaar plc (“Xaar” or “the Company”) announces that, further to the announcement on 14 November 2006, of an unsolicited approach received from Danaher Corporation ("Danaher") indicating a possible offer for the Company in the range of 200 - 220 pence per share, Xaar can confirm that there has been further contact between the companies and that it has received a second, informal, proposal from Danaher in relation to a possible offer for the Company. Both of Danaher's approaches and possible offers have been highly preliminary and subject to a number of conditions, including due diligence.

After due consideration, the Board of Xaar has concluded that Danaher’s latest proposal continues to undervalue the Company significantly and that Danaher’s position has not moved sufficiently to form an acceptable basis for further discussion. Accordingly, the Company has ended discussions with Danaher.

In the trading update issued on 7 December 2006, the Company reported an improved trading performance in the closing months of the year which has continued into the early part of 2007. The Board continues to be confident in the longer-term prospects of the Company in a rapidly growing market, as well as the strategic value of its ink-jet technology. A further update on trading will be given at the time of the announcement of Xaar’s final results for 2006 in mid-March.

The Board re-iterates its advice that shareholders should take no further action at this time in relation to any possible offer.

Xaar is being advised by Panmure Gordon in relation to this matter.

This announcement is made without Danaher’s consent.

Contacts 
Xaar plc: 01223-423663
Ian Dinwoodie, Chief Executive
Nigel Berry, Group Finance Director & Deputy Chief Executive

Panmure Gordon:
Edward Farmer: 020-7459-3600

Bankside Consultants:
Steve Liebmann or Simon Bloomfield: 020-7367-8883 / 07802-888159