Scottish Power PLC
22 November 2005


Not for release, publication or distribution into, Canada, Australia or Japan


FOR IMMEDIATE RELEASE
                                      22 November 2005


                      ScottishPower plc ('ScottishPower')

                Statement regarding E.ON AG ('E.ON') withdrawal
                ScottishPower announces revised dividend policy

The Board of ScottishPower notes today's announcement from E.ON.


E.ON's final proposal to ScottishPower was at 570p per ScottishPower share,
which ScottishPower considers would not have been received by shareholders
earlier than the Spring of 2007, when any transaction was expected to complete.
The Board, which received independent financial advice from Morgan Stanley and
UBS, concluded that this proposal did not reflect the fair value of
ScottishPower and its prospects.  In providing their advice, Morgan Stanley and
UBS have relied upon the commercial assessments of the directors of
ScottishPower. Accordingly, the Board has rejected this final proposal and
discussions have ceased.


Background


E.ON announced that it was considering making an offer for ScottishPower on 5
September and made its initial approach to ScottishPower on 26 September. Over
recent weeks the Board of ScottishPower has been engaged in extensive
discussions with E.ON to see if it was possible to reach agreement on an offer
for ScottishPower that reflected fair value for our shareholders and had a high
degree of deliverability.  It was not possible to reach such an agreement and
therefore these discussions are now at an end.



The talks included discussion of the strong performance of ScottishPower's
continuing businesses, their strategic position and their potential value to
E.ON, as well as how the parties would cooperate during the regulatory
investigation.


The proposals



As a consequence of these discussions, E.ON made two further proposals to
ScottishPower.  The proposals made by E.ON can be summarised as follows:


•  The initial approach valued ScottishPower at 575p LESS any dividends
declared or paid by ScottishPower prior to completion.


•  On 2 November, E.ON made a proposal of 564p per share LESS any
dividends declared or paid by ScottishPower prior to completion of the
transaction, other than a maximum of 24p per share in dividends. The 24p cap on
dividends included the dividend of 5.2p per share announced on 10 November 2005.


•  On 18 November, E.ON made a final proposal of 570p per share.
ScottishPower would be permitted to pay dividends in the normal course prior to
closing.


 In each case, other key elements of the proposals included:


•  Any offer, if made, would have been subject to pre-conditions in
respect of regulatory approvals and the completion of the sale of PacifiCorp on
the existing contractual terms; and


•  ScottishPower would be permitted to return the proceeds from the
PacifiCorp disposal to shareholders as previously announced. However, the value
of any offer would be reduced by the amount distributed to ScottishPower
shareholders.


In discussions, it became clear that both parties had been advised it could take
up to 9 to 12 months to obtain regulatory approval.  The ScottishPower Board
therefore considers that completion would not have been earlier than the Spring
of 2007.


ScottishPower strategy


On 10 November ScottishPower published its interim results for the six months to
30th September 2005.  The continuing businesses delivered Operating Profits up
40%, Profit before tax up 45% and Earnings Per Share up 64% (all adjusted for
IAS39 and exceptional items). This strong performance continued the strong trend
from the previous year.


ScottishPower will continue to implement its successful strategy of building its
UK Wholesale and Retail businesses, seeking to outperform the regulatory review
in its UK Networks business, and growing PPM Energy.  The company has a clear
and disciplined investment programme which is delivering returns well above the
group's cost of capital, is pursuing programmes to improve further operational
performance, and is implementing a corporate restructuring to deliver £60m of
annualised cost savings. As stated in the interim results, the process to
dispose of PacifiCorp is proceeding on schedule, and on completion this will
enable ScottishPower to return approximately £2.5bn to shareholders.


It is the Board's view that the implementation of this strategy will be of
greater long term value to ScottishPower's shareholders than the E.ON proposal.



Revised dividend policy


The Board of ScottishPower also announces that following a review of dividend
policy it intends to pay a fourth quarter dividend of 9.4p per share (2004
7.65p) resulting in a total dividend for the year ending March 2006 of 25p per
share, a year on year increase of 11.1%. For the following two years, the Board
is aiming to deliver an annual increase in the dividend of a minimum of 7%.
Following the completion of the sale of PacifiCorp, we intend to pay the
dividend semi annually.


This new policy (and the proposed fourth quarter dividend) replaces our previous
policy of targeting 1.5 - 2.0x dividend cover and reflects our confidence in the
prospects of the Networks business following the recent regulatory review, the
strong performance of the Wholesale and Retail businesses, and the expected
premium returns to be achieved from the recent and ongoing investment in PPM
Energy.


Contacts:


ScottishPower

Jennifer Lawton                                 Tel.: 0141 636 4527
Simon McMillan                                  Tel.: 0141 566 4875

Tulchan Communications Group                    Tel.: 0207 353 4200
Andrew Grant



The Directors of ScottishPower accept responsibility for the information
contained in this announcement. To the best of the knowledge and belief of the
Directors of ScottishPower, who have taken all reasonable care to ensure that
this is the case, such information is in accordance with the facts and does not
omit anything likely to affect the import of such information. This announcement
does not constitute an offer or invitation to purchase or subscribe for any
securities.

Morgan Stanley & Co. Limited ('Morgan Stanley') and UBS Limited ('UBS') are
acting for ScottishPower in connection with the possible offer and no-one else
and will not be responsible to anyone other than ScottishPower for providing
protections afforded to clients of Morgan Stanley or UBS or for providing advice
in relation to the possible offer.

                                    - Ends -


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