The directors present their report and accounts for the year ended 31 December 2008.

Spectris designs, develops and markets productivity-enhancing instrumentation and controls. For 2008 reporting purposes, the businesses were grouped into four segments: Materials Analysis, Test and Measurement, in-line Instrumentation and Industrial Controls. Further details of the trading companies can be found in the Business Review. Developments in the group's business activities are discussed in the Chairman's Statement, the Chief Executive's Statement and the Business Review..

During the year a number of acquisitions were made. Malvern Instruments acquired Viscotek Corporation, a US-based provider of chromatography solutions for the characterisation of natural and synthetic polymers and proteins. HBM and Particle Measuring Systems acquired their distributors in, respectively, the Nordic countries and China. HBM acquired nCode International, a supplier of durability, test and analysis software and mobile data acquisition instruments. Microscan acquired Siemens' Machine Vision Business, a leader in Automatic Identification and Data Capture (AIDC), specialising in machine vision and inspection systems used in a broad array of manufacturing, packaging and traceability applications. Finally, the LDS Test & Measurement business was acquired and integrated with Brüel & Kjær Sound & Vibration and HBM. LDS is a leader in integrated vibration test and measurement equipment and software for applications in the aerospace, defence, automotive, machinery, electrical and electronics markets. The total consideration, including acquisition expenses and net debt acquired, as well as deferred and contingent consideration expected to be paid in future years, for the above acquisitions, was £88.8 million. Deferred consideration paid and working capital adjustments made during the year in respect of prior year acquisitions amounted to £1.3 million.

There were no disposals during the year.

The share capital of the company comprises ordinary shares of 5p each; each share carries the right to one vote at general meetings of the company. The authorised and issued share capital of the company, together with movements in the company's issued share capital during the year, are shown in Note 25. The Articles of Association of the company, available on the company's website, contain provisions governing the ownership and transfer of shares.

At the 2008 Annual General Meeting shareholders authorised the directors to make market purchases of the company's ordinary shares up to a maximum number of 12,500,000 shares, representing approximately 10% of the issued share capital of the company, and to either cancel the shares or hold them as Treasury shares which may then be cancelled, sold for cash or transferred for the purposes of the company's share plans, depending on the best interests of the company's shareholders at the time. At the close of business on 23 February 2009, the company had 125,005,123 ordinary shares in issue, of which 9,694,495 were held in Treasury. During the year 21,363 shares were transferred out of Treasury to meet the company's obligations under its share plans and no shares were cancelled out of Treasury. An authority to make further market purchases of the company's ordinary shares, if believed appropriate, will be sought at the forthcoming Annual General Meeting although the Board has no present intention of so doing.

Also included in the special business of the 2009 Annual General Meeting are proposals to renew the directors' authority to allot shares up to prescribed limits.

The company is introducing a Dividend Reinvestment Plan, providing shareholders with the option of using their dividend payments to buy additional Spectris plc shares. Further details are given in the Notice of Annual General Meeting.

At 23 February 2009 interests notified to the company in accordance with Chapter 5 of the Disclosure and Transparency Rules comprised:

Standard Life Investments
10,490,369 shares (9.10% material interest)

AXA SA
6,160,607 shares (5.34% material interest)

Ameriprise Financial Inc.
5,747,326 shares (4.98% material interest)

Legal & General Group Plc
4,997,437 shares (3.99% material interest)

Barclays Global Investors
3,483,251 shares (3.02% material interest)

Pursuant to s992 of the Companies Act 2006, which implements the EU Takeovers Directive, the company is required to disclose certain additional information. Such disclosures, which are not covered elsewhere in this Annual Report, include the following:

The company's Articles of Association ('Articles') give power to the Board to appoint directors, but require directors to submit themselves for election at the first Annual General Meeting following their appointment and for re-election where they have been a director at each of the preceding two Annual General Meetings and were not appointed or re-appointed by the company at, or since, either such meeting. The Articles may be amended by special resolution of the shareholders and are available to view on the company's website.

The Board of directors is responsible for the management of the business of the company and may exercise all the powers of the company subject to the provisions of the relevant statutes, the company's Memorandum of Association and the Articles. The Articles contain specific provisions and restrictions regarding the company's power to borrow money. Powers relating to the issuing and buying back of shares are also included in the Articles and such authorities are renewed by shareholders each year at the Annual General Meeting.

There are a number of agreements that take effect, alter or terminate upon a change of control of the group following a takeover, such as bank loan agreements and company share plans. None of these are deemed to be significant in terms of their potential impact on the business of the group as a whole. In addition, there is a service contract between the company and one of its directors which provides for compensation for loss of office or employment following a change of control of the group (please refer to the Directors' Remuneration Report for further explanation). It is also possible that funding arrangements for the group's defined benefit pension arrangements would need to be enhanced following a change of control if that resulted in a weakening of the relevant employer covenant.

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