Stmnt re Chesterfield Prop

LONDON STOCK EXCHANGE
6 September 1999



CHESTERFIELD PROPERTIES PLC

1.   A  hearing  of the Quotations Appeals Committee of the London  Stock
     Exchange  took place on 2 September 1999 to consider  an  appeal  by
     Chesterfield Properties Plc ('the Company') against the Decision of the
     Quotations Committee dated 23 July 1999 by which it directed that the
     Company be censured and that its Decision and its reasons be published.

2.   The  Appeals  Committee has upheld the decision  of  the  Quotations
     Committee, the text of which is set out below.  The reasons for  the
     Appeals  Committee's decision are, subject to the  clarification  in
     paragraph 4. below, the same as those given by the Quotations Committee.

3.   The  fact that the breach of paragraph 14.2 of the Listing Rules was
     deliberate and the factors set out in paragraphs 15-17 of the Decision of
     the Quotations Committee, make it appropriate that the censure be made
     public.  At the same time the Appeals Committee considers it right to
     record  that the breach was an honest misjudgment made in  what  the
     Company's directors genuinely believed to be the best interests of its
     shareholders after obtaining professional advice.  The decision is not a
     reflection  on the integrity of the directors or their  professional
     advisers.

4.   Although  the  Appeals Committee accepts the Quotations  Committee's
     view expressed in paragraph 14.1 of its Decision that 'the position in
     which Chesterfield found itself in the week beginning 19 April 1999 was
     foreseeable', having heard further evidence from the Company and its
     advisers it takes a different view of the facts but reaches the same
     overall conclusion.  The view of the Quotations Committee was however an
     understandable one bearing in mind that its finding was based on evidence
     given by the Company which the latter has now  itself corrected.   In the
     view of the Appeals Committee it was clear by no later than 16 April that
     there was a significant risk that a sale would not be completed by 29
     April.   By 16 April the Company should have been able to determine that
     it  was  unlikely  to be in a position to post  a  circular  to  its
     shareholders giving definitive advice as to how they should exercise
     their voting rights at the forthcoming Extraordinary General Meeting.
     Nevertheless the Company did not submit a draft circular to the Exchange
     until 21 April in spite of its own belief that it was essential to post
     the circular by not later than 22 April.   Had the Exchange been given a
     little more time, what the Company saw as its dilemma would have been
     satisfactorily resolved.

Decision of the Quotations Committee


1.    A  hearing of the Quotations Committee of the London Stock Exchange
      ('The Stock Exchange') took place on 9 July 1999 to consider a reference
      from the Listing Department under Paragraph 1.8 of The Stock Exchange's
      Listing  Rules  of  the  circumstances of  the  issue  by  Chesterfield
      Properties PLC ('Chesterfield') of a circular to its shareholders dated
      22 April 1999.

2.    The   circular  gave  information  about  the  proposed  sale   by
      Chesterfield of 14 of its properties, representing over one quarter  of
      its property portfolio, to GE Capital Corporation (Estates) Limited ('GE
      Capital').  Under the Listing Rules of The Stock Exchange, and in view of
      its size, shareholders' approval was required for this transaction.  This
      was  recognised in the contractual arrangements with GE Capital  which,
      amongst  a  number of matters, required Chesterfield to use  reasonable
      endeavours to procure the passing of an ordinary resolution to  approve
      the transaction before 30 April 1999.  This obligation fell away if any
      offer  was  made  to acquire Chesterfield that was recommended  by  the
      directors.

3.    Following the announcement of the proposed disposal to GE Capital on
      1 March 1999, Chesterfield received a number of approaches from companies
      considering making an offer for the whole of the issued share capital of
      Chesterfield.  One such approach was from Quintain Estates & Development
      plc  ('Quintain').  That approach was announced on 19  March  1999.   A
      condition of any offer by Quintain was that Chesterfield's shareholders
      did not approve the disposal of properties to GE Capital.

4.    Thereafter,   Chesterfield  provided  prospective   bidders   with
      information with a view to one or more of them making an indicative bid
      by 14 April 1999.  In the meantime, and in accordance with the terms of
      the  contract with GE Capital, Chesterfield adjourned its Extraordinary
      General Meeting (originally convened for 22 March 1999 by means  of  an
      initial circular to shareholders posted on 5 March 1999) first until  9
      April 1999 and then until 29 April 1999.

5.    In anticipation of the forthcoming Extraordinary General Meeting on
      29  April  1999,  Chesterfield needed to issue a  further  circular  to
      shareholders  to  enable them to take a decision in the  light  of  all
      material information against the background of the continuing discussions
      with Quintain.

6.    By 19 April 1999, the directors of Chesterfield believed that a
      recommendable offer for the company was likely to be made by Quintain.
      Consistent with their fiduciary duties, the directors of Chesterfield did
      not believe that they could continue to recommend the transaction with GE
      Capital to the company's shareholders.  However, having regard to the
      contract with GE Capital, the directors of Chesterfield could not
      recommend shareholders to vote against the disposal.

7.    A draft of the circular to be sent to shareholders in advance of the
      Extraordinary General Meeting on 29 April 1999 was first circulated  to
      Chesterfield's advisers on 20 April 1999 and to the Stock Exchange on 21
      April 1999.

8.    After  discussion with Chesterfield's advisers,  The Stock Exchange
      agreed  that  the circular could be dispatched without a recommendation
      from  the  company's directors.  However, it did not approve the  draft
      circular and requested the inclusion of some further information.

9.    Following further conversations between Chesterfield's advisors and
      The Stock Exchange, but without either the inclusion of the information
      requested by The Stock Exchange or The Stock Exchange's approval of the
      circular  without that information, Chesterfield printed and dispatched
      its circular to shareholders on the evening of 22 April 1999.  That The
      Stock Exchange had not approved the circular was known to the directors
      of  Chesterfield and its advisors at the time that the decision to post
      the circular was taken.

10.   In  the event, and after further subsequent discussions, The  Stock
      Exchange  agreed  that Chesterfield did not have  to  issue  a  further
      circular including the information that had been requested by it.

11.   Against  this  background,  the matters  referred  by  the  Listing
      Department for consideration by the Quotations Committee were:-

      an  alleged  breach of paragraph 14.2 of the Listing  Rules  by
      Chesterfield  by  failing to obtain formal  approval  from  The
      Stock Exchange for its circular dated 22 April 1999 before  the
      circular was circulated to the Company's shareholders and  made
      available publicly.

12.   At  the  hearing before the Quotations Committee on  9  July  1999,
      Chesterfield admitted its breach of paragraph 14.2 of the Listing Rules.

13.   However, Chesterfield sought to persuade the Committee that it  had
      acted reasonably in all the circumstances in posting the circular without
      including  either  the information requested by The Stock  Exchange  or
      securing  its approval to the draft circular.  It argued,  first,  that
      there  was  a  conflict  between,  on the  one  hand,  its  contractual
      obligations to GE Capital and, on the other, the fiduciary duties of the
      directors not to recommend the proposed transaction to shareholders  in
      circumstances where a recommendable offer from Quintain was in prospect.
      Secondly, it argued that it was essential to dispatch the circular on
      22 April 1999 so that shareholders had the information necessary to
      consider the proposed transaction with GE Capital prior to the latest time
      for lodging proxies before the forthcoming Extraordinary General  Meeting.
      Thirdly, they drew attention to the fact that, subsequently, The  Stock
      Exchange accepted the Company's view that no further  information  was
      required.

14.   In  the  Committee's view, Chesterfield had no proper  grounds  for
      failing  to  obtain approval of the circular prior to  its  posting  to
      shareholders.  This is because

      i) the   position  in  which  Chesterfield  found  itself  in  the  week
         beginning   19   April  1999  was  foreseeable.    It   was   within
         Chesterfield's  contemplation that a bid might  be  received  on  or
         about  14 April 1999, the date by when indicative offers were to  be
         made,  which  might  in due course be capable of  recommendation  to
         shareholders.  However, as those offers were to be indicative  only,
         it  was  unlikely that the company would (whether at  that  time  or
         shortly  thereafter)  be  in  a  position  to  post  a  circular  to
         shareholders giving definitive advice as to how they should exercise
         their   voting  rights  at  the  forthcoming  Extraordinary  General
         Meeting.

     ii) Discussions with The Stock Exchange about the information that
         it had requested be included could and should have been pursued to a
         conclusion.

15.  It is the Committee's decision that Chesterfield was in clear breach
     of  paragraph  14.2  of  the Listing Rules in  posting  a  circular  to
     shareholders without obtaining The Stock Exchange's prior approval of it.

16.  Observance  of  paragraph 14.2 of the  Listing  Rules  is,  in  the
     Committee's view, of great importance because it is the primary means by
     which The Stock Exchange can seek to ensure observance of the standards
     of disclosure required by the Listing Rules in a circular to shareholders
     of  a non-routine nature.  It is, in the Committee's view, unacceptable
     for issuers to disregard the Listing Rules on the basis that they either
     disagree with The Stock Exchange's views, or consider that they are under
     commercial or other pressure to do so.

17.  The Committee, therefore, censures Chesterfield for its failure  to
     obtain  the  Listing Department's prior approval to the  issue  of  the
     circular to shareholders dated 22 April 1999.  As the Committee takes a
     very serious view of this breach, the Committee considers it appropriate
     that its decision and the reasons for it be published.