Rule 8.3 - GALLAHER GROUP

FORM 8.3

    DEALINGS BY PERSONS WITH INTERESTS IN SECURITIES REPRESENTING 1% OR MORE
              (Rule 8.3 of the City Code on Takeovers and Mergers)


1.   KEY INFORMATION

Name of person dealing        BARCLAYS PLC
(Note 1)
Company dealt in              GALLAHER GROUP
Class of relevant security    ORD GBP0.10
to which the dealings being
disclosed relate (Note 2)
Date of dealing               20 December 2006

2.   INTERESTS, SHORT POSITIONS AND RIGHTS TO SUBSCRIBE

(a)  Interests and short positions (following dealing) in the class of relevant
security dealt in (Note 3)

                            Long                     Short

                      Number       (%)         Number       (%)

(1) Relevant       37,781,901     5.75%       373,977      0.06%
securities
(2) Derivatives       114,332     0.02%       597,036      0.09%
(other than
options)
(3) Options and         1,000     0.00%             0      0.00%
agreements to
purchase/sell
Total              37,897,233     5.77%       971,013      0.15%


(b)  Interests and short positions in relevant securities of the company, other
     than the class dealt in (Note 3)

Class of                    Long                     Short
relevant
security:

                  Number              (%)   Number              (%)

(1) Relevant
securities

(2) Derivatives
(other than
options)

(3) Options and
agreements to
purchase/sell

Total


  (c)  Rights to subscribe (Note 3)

Class of relevant security:   Details



3.   DEALINGS (Note 4)

  (a)  Purchases and sales

Purchase/sale Number of Securities Price per unit
                                   (GBP)
Purchase      15,445               11.4423
Purchase      1,055                11.4850
Purchase      37,968               11.4724
Purchase      3,531                11.5200
Purchase      4,638                Transfer
Purchase      74,300               11.4850
Purchase      5,702                11.4400
Purchase      5,964                11.5200
Purchase      96,930               11.5032
Purchase      1,388                11.5200
Purchase      831                  11.5200
Purchase      708,300              11.4773
Purchase      50,000               11.4872
Sale          130,153              11.4400
Sale          2,106                11.4875
Sale          400                  11.4627
Sale          557                  11.5200
Sale          831                  11.5200
Sale          1,388                11.5200
Sale          180,266              11.4764
Sale          705                  11.4400
NB: The below transactions which were disclosed on 20/12/2006 have been cancelled
Purchase/Sale Number of Securities Price per unit (GBP)
Purchase      3,531                11.5200


(b)  Derivatives transactions (other than options)

Product name,  Long/Short    Number of     Price per
(e.g. CFD)     (Note 6)      Securities    unit (GBP)
CFD            Short         15445         11.4422
CFD            Short         37968         11.4723
CFD            Short         708300        11.4773
CFD            Short         74300         11.4850
CFD            Long          400           11.4627
CFD            Long          180266        11.4763

(c)  Options transactions in respect of existing securities

(i)  Writing, selling, purchasing or varying

Product name,   Writing,          Number of          Exercise  Type, e.g.      Expiry   Option money
e.g. call       selling,          securities to      price     American,       date     paid/received
option          purchasing,       which the option             European etc.            per unit (GBP)
                varying etc.      relates (GBP)


(ii) Exercising

Product name, e.g.  Number of           Exercise price per
call option         securities          unit (Note 5)




(d)  Other dealings (including new securities) (Note 4)


Nature of transaction Details           Price per unit
(Note 8)                                (if applicable)
                                        (Note 5)





4.   OTHER INFORMATION

Agreements, arrangements or understandings relating to options or derivatives


Full details of any agreement, arrangement or understanding between the
person disclosing and any other person relating to the voting rights of
any relevant securities under any option referred to on this form or
relating to the voting rights or future acquisition or disposal of any
relevant securities to which any derivative referred to on this form is
referenced.  If none, this should be stated.





Is a Supplemental Form 8 attached? (Note 9)                 NO


Date of disclosure                         21 December 2006
Contact name                               BARCLAYS COMPLIANCE
Telephone number                           020 7116 2913
If a connected EFM, name of
offeree/offeror with which connected
If a connected EFM, state nature of
connection (Note 10)


Notes

The Notes on Form 8.3 can be viewed on the Takeover Panel's website at
www.thetakeoverpanel.org.uk