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               14 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       37,171,358     5.66%     1,227,863      0.19%
securities
(2) Derivatives     1,161,607     0.18%       569,868      0.09%
(other than
options)
(3) Options and             0     0.00%             0      0.00%
agreements to
purchase/sell
Total              38,332,965     5.84%     1,797,731      0.27%




(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      100,000              11.6274
Purchase      3,588                11.5500
Purchase      100,000              11.5717
Purchase      15,318               11.5523
Purchase      35,948               11.6958
Purchase      25,600               11.6760
Purchase      5,175                Transfer
Purchase      12,287               11.5385
Purchase      100,000              11.6466
Purchase      1,981                11.4523
Sale          6,287                11.5618
Sale          12,999               11.5984
Sale          4,345                11.5500
Sale          35,943               11.6965
Sale          819                  11.5250
Sale          49,555               11.5352
Sale          14,800               11.5286
Sale          57,000               11.5608
Sale          79,315               11.6319
Sale          52                   11.5500
Sale          5,638                11.5984
Sale          226,309              11.5984
Sale          5,347                11.5984
Sale          10,268               11.5984
Sale          11,229               11.6213
Sale          391                  11.5500

(b)  Derivatives transactions (other than options)

Product name,  Long/Short    Number of     Price per
(e.g. CFD)     (Note 6)      Securities    unit (GBP)
CFD            Short         1981          11.4522
CFD            Short         12287         11.5384
CFD            Short         15318         11.5523
CFD            Short         25600         11.6759
CFD            Short         35948         11.6957
CFD            Long          14800         11.5286
CFD            Long          6287          11.5617
CFD            Long          11229         11.6212
CFD            Long          79315         11.6318
CFD            Long          35943         11.6964



(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                         15 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