Holding in Company

Costain Group PLC
9 August 2000

                  DEALINGS BY SUBSTANTIAL SHAREHOLDERS


1)   NAME OF COMPANY

COSTAIN GROUP PLC

2)   NAME OF SHAREHOLDER HAVING A MAJOR INTEREST

THE ROYAL BANK OF SCOTLAND GROUP PLC

3)   Please state whether notification indicates that it is in respect of 
     holding of the Shareholder named in 2 above or in respect of a 
     non-beneficial interest or in the case of an individual holder if it is a
     holding of that person's spouse or children under the age of 18

SEE BELOW

4)   Name of the registered holder(s) and, if more than one holder, the 
     number of shares held by each of them.

GLENCAIRN NOMINEES LIMITED

5)   Number of shares/amount of stock acquired.

500

6)   (0.00014%) of issued Class

7)   Number of shares/amount of stock disposed

N/A

8)   ( N/A %) of issued Class

9)   Class of security

ORDINARY SHARES

10)  Date of transaction

7 AUGUST 2000

11)  Date company informed

9 AUGUST 2000

12)  Total holding following this notification

292,469,986
               
              
13)  Total percentage holding of issued class following this notification

86%

14)  Any additional information

THE FIGURE IN BOX 12 INCLUDES 72,307,521 SHARES WHICH ARE COUNTED TWICE BY
VIRTUE OF ONE PARTY TO A SECTION 204 AGREEMENT HOLDING OPTIONS TO PURCHASE
SHARES HELD BY OTHER PARTIES TO THAT AGREEMENT.

15)  Name of contact and telephone number for queries

C. L. FRANKS       01628 842 575

16)  Name and signature of authorised company official responsible for 
     making this notification

     Date of Notification ...9 AUGUST 2000............................



LETTER TO:     THE PERSONS WHOSE NAMES APPEAR ON THE SCHEDULE BELOW
LETTER DATED:  7 AUGUST 2000

PART VI of the Companies Act 1985 (the 'Act')

This letter constitutes notification under Part VI of the Act and relates to
ordinary share capital of Costain Group plc (the 'Company').

This notification relates, inter alia, to interests which arise under certain
Agreements dated 10 October 1997 made between the Company, certain subsidiaries
of the Company and the parties whose names and addresses appear in the schedule
below to this letter. The agreement constitutes an agreement to which section
204 of the Act applies (the 'Section 204 Agreement').

We hereby give you notice under Part VI of the Act that we are interested in
292,469,986 ordinary shares of 10p each in the capital of the Company
('Shares').

The identities of the registered holders of the Shares to which this
notification relates and the number of Shares held by each are as set out in the
Schedule of shareholdings attached to this letter.

Of the interest shown 14,597 shares are not material interests under Section 199
of the Act. However, in addition there are a further 205,445 shares in which the
NatWest Group has a material and non material interest.

LETTER FROM:   THE ROYAL BANK OF SCOTLAND GROUP PLC


                                 SCHEDULE
                 Names of parties to the Section 204 Agreement

C L FRANKS
COSTAIN ENGINEERING SERVICES INC
COSTAIN DUBAI LLC
COSTAIN HOMES HOLDINGS INC
RAYMOND INTERNATIONAL WLL
DAEDALUS PROJECTS LTD
INTRIA BERHAD
BANCO SANTANDER SA
BANKERS TRUST COMPANY
BANKERS TRUST INTERNATIONAL
BANK OF AMERICA NT & SA (LOAN TRADING GROUP)
BANK OF AMERICA NT & SA (SPECIAL ASSETS GROUP)
CITIBANK NA
SKANSA INVEST AB
LLOYDS BANK PLC
STANDARD CHARTERED BANK PLC
RJ HOPKINS

                           COSTAIN GROUP PLC
              Schedule of shareholdings of the Participating 
                               Banks

Names of registered         Number of      Number of such       Number of such
holder                      Shares         Shares in which the  Shares in which
                                           interest arises by   the interest is
                                           virtue of the        a section       
                                          Section  204         208(5) interest
                                           Agreement

Banco Santander SA          1,366,609         1,306,024                 NIL
Bankers Trust Company         413,085           413,085                 NIL
KAS Nominees Designated
 Account 1030                 323,830           323,830                 NIL
Banco Santander SA                468               468                 NIL
Chase Nominees Ltd A/C
 SO 2196                    2,334,974         2,334,974                 NIL
Cargill Financial Markets
 plc                        1,006,297         1,006,297                 NIL
Bank of America 
 International Ltd            463,450               NIL                 NIL
Bank of America
 NT & SA                    3,601,470         3,601,470                 NIL
Bank of America
 NT & SA                    5,322,542         5,322,542                 NIL
Citibank International Plc  1,165,331         1,044,333             120,998
Ranelagh Nominees Ltd      10,647,000         9,734,704                 NIL
LLoyds Bank (PEP Nominees)
 Ltd                           12,483               NIL                 NIL
LLoyds Private Banking
 (Isle of Man)                    948               NIL                 NIL
NatWest FIS Nominees Ltd          416               NIL                 NIL
CNW Nominees Ltd           12,720,273        11,556,292                 NIL
BNY GIL Client A/C 
 Nominees Ltd                 205,445               NIL                 NIL
Standard Chartered Nominees
 Ltd J                      4,097,553         3,694,468                 NIL
Daedalus Projects Ltd     125,354,541        42,500,000                 NIL
Raymond International WLL  25,562,500           562,500                 NIL
Skanska Invest AB          97,870,021        25,562,500          72,307,521
Glencairn Nominees Ltd            750               NIL                 NIL


TOTALS                    292,469,986       108,963,487          72,428,519