Notice of EGM

Mercury Group PLC
21 July 2005


                               Mercury Group plc
                   ('Mercury', the 'Group' or the 'Company')

             Placing, Capital Reorganisation and Capital Reduction
                                 Notice of EGM

The Company announced on 4 July 2005 the placing of 666,666,666 new Ordinary
Shares at 0.3p per share to raise £2.0 million. Of that total number of new
Ordinary Shares placed, 116,666,666 new Ordinary Shares are conditional on
Shareholder approval.

The Board is also today proposing the Capital Reorganisation and the Capital
Reduction with a view to rebasing the price of the Ordinary Shares and improving
the Company's future dividend capacity by eliminating the retained deficit on
Mercury's profit and loss reserve.

The Company posted today a circular to its Shareholders relating to the Placing,
Capital Reorganisation and Capital Reduction, a copy of which is available free
of charge for a period of one month from the date of this announcement from the
Company's registered office at Hilden Park House, 79 Tonbridge Road,
Hildenborough, Kent TN11 9BH. The circular contains the notice of the EGM which
will be held on Monday 15 August 2005 at 12.00 noon. at the offices of Jones
Day, 21 Tudor Street, London EC4Y 0DJ.

Timetable
Latest time and date for receipt of Forms of Proxy                        12.00 noon on 13 August 2005
Extraordinary General Meeting                                             12.00 noon on 15 August 2005
Admission and commencement of dealings in Placing Shares                     08.00 a.m. 16 August 2005
Record Date for the Capital Reorganisation                         Close of business on 16 August 2005
Capital Reorganisation becomes effective                                                17 August 2005
Despatch of new share certificates following Capital Reorganisation                  By 23 August 2005

Enquiries:

Mercury Group plc
David Williams, Chairman                          020 7422 6555

Biddicks
Katie Tzouliadis                                  020 7448 1000

KBC Peel Hunt Ltd
Julian Blunt                                      020 7418 8900



Details on the Placing

On 4 July 2005 Mercury announced that it had raised approximately £2.0 million
from the placing of 666,666,666 new Ordinary Shares in order to provide the
Group with additional working capital and funding for acquisitions, should such
opportunities present themselves (the ''Aggregate Placing''). The 666,666,666
new Ordinary Shares comprising the Aggregate Placing represented 34.8 per cent.
of the Company's issued share capital immediately prior to the announcement of
the Aggregate Placing and 25.8 per cent. of the Company's Enlarged Issued Share
Capital. The Placing Price represents a discount of approximately 3.2 per cent.
to the closing mid-market price of 0.31p per Ordinary Share on 1 July 2005,
being the last dealing day prior to the announcement made on 4 July 2005.

Of the 666,666,666 new Ordinary Shares comprising the Aggregate Placing,
550,000,000 new Ordinary Shares have already been allotted under authorities
already granted by Shareholders. The remaining 116,666,666 new Ordinary Shares
to be issued pursuant to the Placing require Shareholder approval. Application
has been made to the London Stock Exchange for the Placing Shares to be admitted
to trading on AIM and it is anticipated that dealings in the Placing Shares will
commence on 16 August 2005. The Placing is conditional upon Admission becoming
effective. The Placing Shares will be issued credited as fully paid and will
rank pari passu in all respects with the existing issued Ordinary Shares in the
Company, including the right to receive all dividends and other distributions
declared or paid thereon following Admission and will be subject to the Capital
Reorganisation.

The Directors believe that raising finance by way of a placing of new Ordinary
Shares is the most appropriate method of providing funding to the Company at the
present time. A general offer to Shareholders by way of a rights issue or other
pre-emptive issue is not considered appropriate at this stage of the Company's
development given its size, the current Shareholder structure and taking into
account timing and cost considerations.

Background to and details of the Capital Reorganisation and associated
arrangements

As part of Mercury's strategy as the holding company of an integrated property
services group, the Board believes that it is now appropriate to re-base the
Company's share price and is accordingly proposing the Capital Reorganisation.

The Capital Reorganisation will be put into effect by the passing of a
resolution at the EGM, the effect of which will be to consolidate every 25
Existing Ordinary Shares into one ordinary share of 2.5p each, each of which
will then be immediately subdivided into one Ordinary Share with a par value of
1p and one A Deferred Share of 1.5p. The effect of the Capital Reorganisation
will be that any Shareholder currently holding fewer than 25 Existing Ordinary
Shares will not hold any interest in the Company following the Capital
Reorganisation becoming effective. The Capital Reorganisation will be carried
out after the close of business on the day after the EGM.

The fractional entitlements arising on the consolidation of every 25 Existing
Ordinary Shares into one ordinary share of 2.5p will be aggregated and sold as
soon as practically possible following the Capital Reorganisation. The net
proceeds arising from the sale of fractional entitlements will be retained by
the Company. As at 20 July 2005, the latest practicable date prior to the
announcement of the Proposals, a shareholding of 25 Existing Ordinary Shares was
worth 10.875p.

As a consequence of the Capital Reorganisation, if you hold fewer than 25
Existing Ordinary Shares in the Company at the close of business on 16 August
2005, you will cease to be a Shareholder in the Company. If you currently hold
fewer than 25 Existing Ordinary Shares and wish to retain an interest in the
Company following the proposed Capital Reorganisation you must ensure that at
the close of business on 16 August 2005 your holding is in excess of 25 Existing
Ordinary Shares. This could be achieved by buying further Ordinary Shares on the
stock market. You should not however regard this as an encouragement or
recommendation to deal in the Company's Existing Ordinary Shares and you should
seek your own advice in this regard from your stockbroker, bank manager,
solicitor, accountant, fund manager or other independent financial adviser
authorised under FSMA.

A Deferred Shares and Deferred Shares

The A Deferred Shares arising on the Capital Reorganisation will have no voting
or dividend rights and, on a return of capital, the right only to receive the
amount paid up thereon after the holders of Ordinary Shares have received the
aggregate amount paid up thereon plus £1 million per Ordinary Share.
Consequently, the A Deferred Shares will effectively be valueless. The Company
intends to cancel all of the A Deferred Shares pursuant to section 135 of the
Act, subject to Shareholder approval and the sanction of the High Court.

Pending the cancellation by the Company of the A Deferred Shares, no share
certificates will be issued in respect of them, nor will CREST accounts of
Shareholders be credited in respect of any entitlement to A Deferred Shares.

Subject to Shareholder approval, the Directors intend to effect an identical
strategy in relation to the Deferred Shares which were created on 9 April 2003
and which are (as the A Deferred Shares will be) effectively valueless and in
respect of which no share certificates have been issued or CREST accounts
credited.

Neither the Deferred Shares nor the A Deferred Shares are (or will be) admitted
to AIM.

Capital Reduction

As at 30 September 2004, the deficit on the Company's profit and loss account
amounted to approximately £8.4 million. The Company is now seeking to restore
its ability to pay dividends. Under section 263 of the Act the Company can only
pay dividends out of profits available for the purpose. It is proposed to
eliminate the deficit on the profit and loss account and to create distributable
reserves through the cancellation of the A Deferred Shares, the Deferred Shares
and the Company's share premium account.

The Capital Reduction described above requires the approval of Shareholders and
is also subject to the confirmation of the High Court. The Company intends to
apply to the High Court for such confirmation as soon as possible. The Capital
Reduction will only become effective following registration of the relevant
court order with the Registrar of Companies in England and Wales. The Company
will give such undertakings to the High Court, including undertakings as to the
use of any special reserve arising out of the reduction of capital and as to the
creation of a blocked bank account to protect the Company's creditors as it may
be advised are appropriate. Subject to Shareholders' approval at the EGM and the
sanction of the High Court, it is expected that the Capital Reduction will
become effective by the end of October 2005.

It should be noted, however, that any payment of dividends to Shareholders in
the future will be dependant on the future performance of the Company after the
Capital Reduction.

Extraordinary General Meeting

In order to give effect to the Proposals, an Extraordinary General Meeting of
the Company is being convened for 12.00 noon on 15 August 2005 at which the
Resolutions will be proposed. The Extraordinary General Meeting is to be held at
the offices of Jones Day, 21 Tudor Street, London, EC4Y 0DJ. The Resolutions are
proposed for the following purposes:

 (i)   To increase the authorised share capital of the Company.
 (ii)  To generally and unconditionally authorise the Directors to
       exercise all of the powers of the Company to allot up to 2,538,643,663 Ordinary
       Shares of which 1,234,666,667 shares are set aside to meet the Company's maximum
       commitments in respect of previous acquisitions, 116,666,666 shares are the
       Placing Shares and 27,200,000 are to be issued to certain consultants to the
       Company in lieu of cash for services rendered, leaving 1,160,110,330 shares
       which will represent 44.53 per cent of the Company's issued share capital
       following the issue of the Placing Shares and the issue of the shares to
       consultants. The authority replaces all existing authorities to allot and will
       expire at the next annual general meeting.
 (iii) To disapply the statutory pre-emption rights contained in
       section 89(1) of the Act in respect of rights issues and otherwise up to a
       maximum nominal amount of £400,000 of which £143,866.67 will be used to issue
       the Placing Shares and the shares to be issued to consultants as mentioned in
 (ii)  above, leaving £256,133.34 representing approximately 9.83 per cent of the
       issued share capital of the company following those share issues. This authority
       will expire at the next annual general meeting of the Company.
 (iv)  To approve the Capital Reorganisation.
 (v)   To approve the retention by the Company of the net sale
       proceeds resulting from the sale of any fractional entitlements arising from the
       consolidation.
 (vi)  To approve the cancellation by the Company of all the
       Deferred Shares and A Deferred Shares.
 (vii) To approve the cancellation of the share premium account.

Save in relation to the Placing, the issue of shares in respect of deferred
consideration on acquired businesses and the issue of Ordinary Shares to certain
consultants to the Company in lieu of cash for services rendered, the Directors
have no current intention of using the authorities referred to in paragraphs (i)
and (ii) above.

                                  DEFINITIONS
The following definitions apply throughout this announcement, unless the context
                              otherwise requires:

''Act'' or         the Companies Act 1985 (as amended)
''Companies
Act''
''A Deferred       the new deferred shares of 1.5p each arising on the Capital
Shares''           Reorganisation
''Admission''      the admission of the Placing Shares to trading on AIM
                   becoming effective in accordance with the AIM Rules
''AIM''            the AIM market of London Stock Exchange
''AIM Rules''      the rules for AIM companies and their nominated advisers
                   published by the London Stock Exchange from time to time
''Board'' or       the directors of Mercury or any duly authorised committee
''Directors''      thereof
''Capital          the proposed cancellation of Deferred Shares, A Deferred
Reduction''        Shares and share premium account as more fully explained in
                   this announcement
''Capital          the proposed consolidation and sub-division of share capital
Reorganisation''   as more fully explained in this announcement
''Company'' or     Mercury Group PLC
''Mercury''
''CREST''          the system for paperless settlement of trades and holdings of
                   uncertificated shares administered and operated by CRESTCo
                   Limited
''Deferred         the 7,076,147,832 deferred shares of 0.1p each in issue at
Shares''           the date of this announcement
''Enlarged Issued  the issued ordinary share capital following the Placing and
Share Capital''    the Capital Reorganisation
''Existing         the ordinary shares of 0.1p each as at the date of this
Ordinary           announcement
Shares''
''Extraordinary    the extraordinary general meeting of the Company convened for
General Meeting''  15 August 2005, and any adjournment thereof
or ''EGM
''Form of          the form of proxy for use at the Extraordinary General
Proxy''            Meeting
''Group''          the Company, its subsidiaries and its subsidiary
                   undertakings
''KBC Peel         KBC Peel Hunt Ltd, the Company's nominated adviser and
Hunt''             broker
''London Stock     London Stock Exchange plc
Exchange''
''Ordinary         the ordinary shares of 0.1p each in the share capital of
Shares''           Mercury or, subject to the passing of Resolution 4, ordinary
                   shares of 1p each in Mercury
''Placing''        the conditional placing of the Placing Shares
''Placing          0.3p per Placing Share
Price''
''Placing          the 116,666,666 new Ordinary Shares (which will become
Shares''           4,666,666 new Ordinary Shares following implementation of the
                   Capital Reorganisation) the subject of the Placing
''Proposals''      together, the Placing, Capital Reorganisation and Capital
                   Reduction
''Registrars''     Capita Registrars, of The Registry, 34 Beckenham Road,
                   Beckenham, Kent BR3 4TU, the trading division of Capita IRG
                   Plc and the registrars of the Company
''Resolutions''    the resolutions to be proposed at the Extraordinary General
                   Meeting
''Shareholders''   holders of Ordinary Shares
''UK'' or ''United United Kingdom of Great Britain and Northern Ireland
Kingdom''
''UK Listing       the Financial Services Authority acting in its capacity as
Authority''        the competent authority for the purposes of Part VI of the
                   Financial Services and Markets Act 2000 (as amended)
''United States''  the United States of America, its territories and
or ''US''          possessions, any state of the United States of America and
                   the District of Columbia and all other areas subject to its
                   jurisdiction



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