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               12 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       37,706,603     5.74%     2,045,352      0.31%
securities
(2) Derivatives     1,019,262     0.16%       640,772      0.10%
(other than
options)
(3) Options and             0     0.00%             0      0.00%
agreements to
purchase/sell
Total              38,725,865     5.90%     2,686,124      0.41%




(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      57,596               11.6058
Purchase      140,550              11.6226
Purchase      4,952                Transfer
Purchase      26,632               11.5250
Purchase      15,409               11.5273
Purchase      1,035                Transfer
Purchase      3,522                11.5250
Purchase      22,070               11.5273
Purchase      9,599                11.5356
Sale          3,494                Transfer
Sale          12,455               11.5567
Sale          2,225                11.5550
Sale          4,480                Transfer
Sale          2,228                11.5550
Sale          91,776               11.5566
Sale          3,566                Transfer
Sale          6,425                Transfer
Sale          9,392                Transfer
Sale          52                   11.5250
Sale          6,263                Transfer
Sale          2,583                11.5551
Sale          4,629                11.5556
Sale          1,831                11.5546
Sale          2,126                11.5541
Sale          2,694                Transfer
Sale          2,878                11.6213
Sale          391                  11.5250
Sale          40,044               Transfer
Sale          3,483                11.5955
Sale          12,876               11.5567
Sale          18,758               Transfer
Sale          2,865                11.5554
Sale          3,380                11.5554
Sale          58,877               Transfer
Sale          6,131                Transfer
Sale          7,365                Transfer
Sale          1,405                11.5541
Sale          3,351                11.5554
Sale          2,335                11.5550
Sale          4,774                Transfer
Sale          145,080              Transfer
Sale          12,603               11.5568
Sale          6,784                Transfer
Sale          1,600                11.5900
Sale          1,927                11.5541

(b)  Derivatives transactions (other than options)

Product name,  Long/Short    Number of     Price per
(e.g. CFD)     (Note 6)      Securities    unit (GBP)
CFD            Short         37479         11.5273
CFD            Short         9599          11.5356
CFD            Short         38787         11.5980
CFD            Short         57596         11.6058
CFD            Short         140550        11.6226
CFD            Long          1600          11.5900
CFD            Long          3483          11.5954
CFD            Long          22151         11.6103
CFD            Long          2878          11.6212



(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                         13 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