Director Shareholding

Diageo PLC
31 May 2001



TO: Regulatory News Service

The London Stock Exchange

RE: CHAPTER 16 PARAGRAPH 13 OF

CONTINUING OBLIGATIONS



Diageo plc (the 'Company') announces the following:

1. That it received notification on 31 May 2001 for the purposes of Section
329 of the Companies Act 1985 of a transaction by the trustee of the Grand
Metropolitan PLC No 2 Employee Share Trust (the 'Employee Share Trust') as
detailed below. The Employee Share Trust is a discretionary trust for the
benefit of employees of the Company and its subsidiaries and operates
primarily in conjunction with former Grand Metropolitan PLC share schemes.

a) A notification that Hill Street Trustees Limited as trustee of the Employee
Share Trust had, on 30 May 2001, transferred 2,000 of the Company's ordinary
shares of 28 101/108 pence ('Ordinary Shares') for nil consideration to Mr P S
Walsh, a director, following his exercise of an option granted under the
Company's US Stock Option Plan (this exercise was notified on 29 May 2001).

b) The following executive directors are potential beneficiaries of the
Employee Share Trust:

N C Rose

P S Walsh

c) As a result of the above transaction, the Employee Share Trust's total
holding in the Company is 46,480 Ordinary Shares and 2,079,419 Ordinary Shares
subject to call options.

2. That it received notification on 31 May 2001 for the purposes of Section
329 of the Companies Act 1985 that the trustee of the Diageo plc QUEST (the
'Trust') has transferred 22,142 Ordinary Shares ('to participants exercising
options granted under the Company's UK Savings-Related Stock Option Scheme and
the Grand Metropolitan Savings-Related Share Option Scheme (the 'Schemes').
The Ordinary Shares were transferred by Diageo QUEST Trustees Limited as
trustee of the Trust. The Trust is a discretionary trust for the benefit of
employees of the Company and its subsidiaries which operates in conjunction
with the Schemes and holds Ordinary Shares to satisfy existing options granted
under the Schemes.

    1.        Executive directors who are potential beneficiaries of the Trust
              are:


              J M J Keenan

              N C Rose

              P S Walsh


    2.        Transactions notified on 31 May 2001 in relation to the Trust.


            Date of                 No. of                  Range of Option
            Transaction             Ordinary                Prices of Ordinary
                                    Shares                  Shares
                                    Transferred

            31.05.01                22,142                  £4.01-
                                                            £4.645
                                                            


    The total holding of the Trust now amounts to 3,271,657 Ordinary Shares.


31 May 2001