New £15.6m Share Issue Open to Investors

Baronsmead VCT 2 PLC
14 February 2000



NEW £15.6 MILLION SHARE ISSUE FOR BARONSMEAD VCT 2 PLC OPEN TO INVESTORS 

Baronsmead VCT 2 plc, a venture capital trust ('VCT') launched in April 1998,
is now open for subscription.  There are two separate offers for subscription,
one closing on 4 April in the current tax year and the other on 24 May in the
2000/2001 tax year.  The minimum subscription is £2,600 and the Offer Price is
130 pence per share*.

Baronsmead VCT 2 plc has already raised £24.9 million since its launch. Its
investment policy is to establish a diverse portfolio of 30 - 40 larger and
profitable unquoted and AiM companies and includes companies applying new
technologies to an existing business with profitable core activities. 
Examples of companies that have adopted this approach in the existing
portfolio of 15 qualifying investments are Aortech, Charterhouse
Communications and SDL.

At the end of January 2000, Baronsmead VCT 2 plc had made 15 qualifying
investments totalling £5.9m, which had a value of £11.4 million, an increase
of 92% over cost.  Part II of the prospectus contains a detailed review of
Baronsmead VCT 2 plc's qualifying investments.  At 31 January 2000, the net
asset value per share had increased to 115.1 pence.  Taking account of
dividends paid and accrued, totalling 5.9 pence per share, this represents a
total return of 28.7% since launch, assuming dividends are reinvested.

David Thorp, Managing Director of Friends Ivory & Sime Private Equity plc and
Fund Manager of Baronsmead VCT 2 plc, said:
'The combination of both unquoted stocks and those traded on AiM in a single
portfolio is an important feature of Baronsmead VCT 2, giving private
investors access to unquoted investments which otherwise they might not be
able to acquire.  As the VCT moves towards a size of £40 million, the
portfolio should become increasingly diversified and take further advantage of
attractive investment opportunities.'

Key information:

Substantial tax reliefs available on first £100,000 invested in each tax year:

 - income tax relief on subscription of up to 20%.
 - up to 40% capital gains tax deferral by reinvesting taxable capital gains 
 - tax-free dividends and capital gains.

Neither Offer has an overall minimum subscription so investors can be certain
that both will proceed.

The issue costs are capped at 5%, from which a commission of 3% of the amount
invested will be payable to qualifying intermediaries.  The annual running
costs are capped at 3.5%, but are expected to be approximately 2.5% p.a. if
the issue is fully subscribed.  

Applications will normally be dealt with in the order they are received,
although the Directors reserve the right to use their discretion in the
acceptance of applications in the event that the Offers are over subscribed.

A copy of the mini-prospectus for Baronsmead VCT 2 plc can be obtained by
calling 0171 853 6908 (line open 24 hours a day, 7 days a week.

The private equity team at Friends Ivory & Sime, which is part of the Friends
Provident Group, undertake the Company's investment management. In terms of
fund raising, between April 1998 and September 1999, Friends Ivory & Sime was
the UK's most successful VCT manager raising over £30 million.

Issued and approved by Friends Ivory & Sime plc which is regulated in the UK
by IMRO.  This document has been produced for information only and should not
be construed as investment advice.  Past performance is not necessarily a
guide to future performance.  Stockmarkets and currency movements may cause
the value of investments and the income from them to fall as well as rise and
investors may not get back the amount they originally invested.  Where
investments are made in unquoted securities or smaller companies, their
potential volatility may increase the risk to the value of, and the income
from, the investment.  All sources Friends Ivory & Sime plc unless otherwise
stated.

For further information
David Thorp               Friends Ivory & Sime       0171 853 6900
Michael Probin            Baronsmead VCT 2 plc       0171 853 6951
Roger Carroll/Jeff Watt   First Financial            0171 353 3444