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               16 January 2007

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       38,389,638     5.84%       258,557      0.04%
securities
(2) Derivatives        84,329     0.01%       822,230      0.13%
(other than
options)
(3) Options and         1,000     0.00%       100,000      0.02%
agreements to
purchase/sell
Total              38,474,967     5.86%     1,180,787      0.18%


(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      240                  11.3400
Purchase      400                  11.3800
Purchase      561                  11.3800
Purchase      5,923                11.3800
Purchase      1,162                11.3800
Purchase      17,210               11.3841
Purchase      4,638                11.3800
Purchase      227                  11.3800
Purchase      56,549               11.3800
Sale          15,927               11.3777
Sale          3,583                11.3300
Sale          12,600               11.3800
Sale          400                  11.3800
Sale          1,162                11.3800
Sale          5,923                11.3800
Sale          399                  11.3777
Sale          8,776                11.3800
Sale          10,413               11.3800
Sale          46,333               11.2927
Sale          227                  11.3800

(b)  Derivatives transactions (other than options)

Product name,  Long/Short    Number of     Price per
(e.g. CFD)     (Note 6)      Securities    unit (GBP)
CFD            Short         17210         11.3840
CFD            Long          16326         11.3777
CFD            Long          12600         11.3800


(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                         17 January 2007
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