Disposal

Berkeley Group Holdings (The) PLC
23 June 2005



                        The Berkeley Group Holdings plc


The Berkeley Group Holdings plc ('Berkeley') announces the disposal of The
Crosby Group plc ('Crosby').


Introduction

The Board of Berkeley announces that it has entered into an agreement with Lend
Lease Corporation Limited ('Lend Lease') for the sale of Crosby for £235.7
million. In addition Berkeley will be repaid £15 million, in respect of working
capital provided to Crosby since 30 April 2005.

Berkeley Group Managing Director Tony Pidgley said:

'I am delighted to announce this transaction which allows Berkeley to focus on
its core market in London and the South East, and gives Berkeley greater
financial flexibility for the future. It is down to Geoff Hutchinson and his
Management Team to take Crosby forward with Lend Lease and I wish him and Crosby
every success in the future. This transaction moves forward the strategy
Berkeley announced at the time of last year's Scheme of Arrangement. The
business becomes more focused and gives the Berkeley Group greater flexibility
in the balance between the generation of cashflow to secure the Return to
Shareholders and maximizing the value of the resultant ongoing business.'

Background to the Transaction
Following the strategic review reported on 26 June 2003 the board of Berkeley
decided to concentrate on increasingly complex mixed-use urban regeneration
projects in London and Southern England. The management of Crosby proposed
maximising the value of the assets within Crosby and incentivising them by
acquiring a shareholding in Crosby. At this time Crosby was a wholly owned
subsidiary of Berkeley.

On 27 August 2003, Berkeley entered into an agreement whereby the Crosby
Managers, led by Geoff Hutchinson, subscribed for newly issued shares in Crosby
('Crosby B Shares') for a consideration of £500,000, funded by a loan from
Berkeley (together 'the Crosby transaction').

Following this subscription the share capital of Crosby comprised Crosby A
Shares, held by Berkeley, and Crosby B Shares, held by the Crosby Managers.
Berkeley retained control of Crosby through its holding of Crosby A Shares and
continued to consolidate Crosby as a subsidiary. Under the terms of the Crosby
Transaction, Crosby had to make agreed milestone payments to Berkeley every six
months and generate in aggregate £450 million of operating cashflow within seven
years of the date of the subscription.

It was agreed that if these two criteria are met, the Crosby B shares are
broadly entitled to 50.01% of the economic and voting rights of Crosby. In
addition, Berkeley would retain voting control of Crosby until the gross assets
and net assets of Crosby fall below £75 million and £50 million, respectively,
at which point voting control of Crosby passes to the Crosby Managers and Crosby
ceases to be consolidated by Berkeley.

The sale of Crosby B Shares to Lend Lease is outside the control of Berkeley and
has been the subject of separate negotiation between the Crosby Managers and
Lend Lease. Upon receipt of the consideration for the sale of their Crosby B
Shares to Lend Lease for £10 million, the Crosby Managers will repay to Berkeley
the £500,000 loan mentioned above. As part of the Disposal, Berkeley and the
Crosby Managers will enter into a Termination Deed, pursuant to which the
arrangements put in place at the time of the Crosby Transaction will be
terminated.

On 25 June 2004, the Berkeley Group announced the next stage of its strategy to
increase the focus of the business while delivering enhanced shareholder value.
On 24 August 2004, it announced proposals to seek to return up to £12 per
existing ordinary share to shareholders (the 'Return') by January 2011. The
Return is to be effected by means of the redemption of four tranches of B
Shares. The 2004 tranche of £5 per unit was redeemed on 3 December 2004. A full
description of the mechanics and payment of the Return including a description
of the rights attaching to the B Shares and the timing of further redemptions
was set out in a circular sent to Shareholders dated 24 August 2004.



Terms of the Transaction

The disposal is unconditional and is due to complete on the 8th July 2005. The
consideration comprises in aggregate £235.7 million in respect of the Crosby A
shares held by Berkeley including the repayment of the inter-company
indebtedness owed to Berkeley by Crosby at 30th April 2005. In addition,
Berkeley will be repaid £15 million in respect of working capital provided to
Crosby since 30th April 2005.

Under the agreement Berkeley has entered into normal warranties and indemnities.
In addition, it has entered into various covenants including an undertaking
restricting the number of developments it can undertake in Birmingham, Leeds and
Manchester.

Berkeley has been advised by UBS Investment Bank.

Reasons for the Disposal and use of Proceeds

The Disposal accelerates the return from Crosby and leaves Berkeley with a more
focused development portfolio based around its core markets in London and the
South-East of England. It also gives Berkeley increased financial flexibility
which will allow Berkeley to take advantage of land opportunities in its core
markets as they arise.

Berkeley proposes to repay the £100 million currently drawn under its existing
revolving facility. The remaining proceeds will be invested in Berkeley's core
markets in London and the South-East of England.

Information on Crosby

Crosby is a leading urban regenerator and residential property developer that
operates out of three regional offices which are located in Birmingham,
Manchester and Leeds. Crosby also benefits from a number of joint venture
relationships. At 31 October 2004, Crosby had 4,488 plots under its control.

The major sites Crosby is developing are Redbank, Manchester; Clarence Dock,
Leeds; Southside, Navigation Street, Essex Street and John Bright Street in
Birmingham; Gosforth in Newcastle; and St James in Cheltenham. Its largest joint
venture sites are Hungate in York and Smithfield in Manchester.

Crosby reported turnover of £229.8 million with an operating profit of £26.7
million and profit before tax of £18.8 million for the year ended 30 April 2004.
For the six months ended 31 October 2004, Crosby reported turnover of £122.9
million, an operating profit of £18.4 million and profit before tax of £14.1
million. These results include Crosby's share of its joint ventures. Crosby's
capital employed (net assets excluding cash and inter-company funding), was
£190.7 million as at 31 October 2004.

Berkeley Annual Results

Berkeley will report its preliminary results for the year ended 30 April 2005 on
24 June 2005.

For further information please contact:

The Berkeley Group Holdings plc                    Cardew Group

A W Pidgley                                        Tim Robertson
R C Perrins

01932 868555                                       0207 930 0777



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