Proposed Disposal

Storehouse PLC
7 April 2000



Not for release, publication or distribution in or into the USA,
Canada, Australia or Japan


Storehouse plc ('Storehouse')

Proposed Disposal of Bhs

Storehouse has agreed the sale of Bhs to Measuremarket Limited
('Measuremarket'), a newly formed company wholly owned by Philip Green
and his family, for total cash consideration of £200 million, subject
to Shareholder approval.

Completion of the Disposal will enable Storehouse to:


*   Return approximately £100 million of the Disposal proceeds to
    Shareholders
    
*   Repay Group debt which amounted to approximately £70 million as
    at 31 March 2000
    
*   Focus management and financial resources on the Mothercare
    recovery programme

Commenting on the proposed sale of Bhs, Alan Smith, Chairman of
Storehouse, said:

'The sale of Bhs will enable Storehouse to return approximately £100
million to Shareholders and to repay all Group debt. Storehouse can
now focus its management and financial resources on accelerating the
recovery programme at Mothercare which will create a strong multi-
channel brand both nationally and internationally.'

A circular will be posted to Storehouse Shareholders as soon as
practicable.

This summary should be read in the context of the full text of this
announcement.

7th April 2000

Enquiries

Storehouse                                             0207 339 2115
Alan Smith (Chairman)                                  
Chris Martin (Finance Director)                        
                                                       
Schroders (financial adviser to Storehouse)            0207 658 6000
Alan Jacobs                                            
Ian Hart                                               
                                                       
Cazenove (broker to Storehouse)                        0207 588 2828
Richard Wintour                                        
                                                       
Brunswick (public relations adviser to Storehouse)     0207 404 5959
Susan Gilchrist                                        
                                                       
Philip Green                                           0207 200 5910
                                                       
WestLB Panmure (financial adviser to Measuremarket)    0207 638 4010
William Tebbit                                         


Schroders, which is regulated by The Securities and Futures Authority
Limited, is acting for Storehouse in connection with the Transaction
and for no one else and will not be responsible to anyone other than
Storehouse for providing the protections afforded to customers of
Schroders or for providing advice in relation to the Transaction.

Merrill Lynch, which is regulated by The Securities and Futures
Authority Limited, is acting for Storehouse in connection with the
Transaction and for no one else and will not be responsible to anyone
other than Storehouse for providing the protections afforded to
customers of Merrill Lynch or for providing advice in relation to the
Transaction.

Cazenove & Co., who are regulated by The Securities and Futures
Authority Limited, are acting for Storehouse in connection with the
Transaction and will not be responsible to anyone other than
Storehouse for providing the protections afforded to customers of
Cazenove & Co. or for providing advice in relation to the Transaction.

WestLB Panmure, which is regulated by The Securities and Futures
Authority Limited, is acting for Measuremarket in connection with the
Transaction and for no one else and will not be responsible to anyone
other than Measuremarket for providing the protections afforded to
customers of WestLB Panmure or for providing advice in relation to the
Transaction.

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Storehouse plc ('Storehouse')
Proposed Disposal of Bhs

1.   Introduction

The Board of Storehouse announces that it has signed an agreement,
conditional on approval by the Shareholders of Storehouse, for the
sale of Bhs to Measuremarket Limited ('Measuremarket'), a newly formed
company wholly owned by Philip Green and his family for total cash
consideration of £200 million (the 'Disposal').

Following the Disposal, Storehouse intends to return approximately
£100 million of the proceeds to Shareholders.

2.   Principal terms of the Disposal

Measuremarket will acquire the issued share capital of Bhs plc,
Storehouse Properties Limited and Davenbush Limited (together 'Bhs'),
on a debt and cash free basis, for total cash consideration of £200
million, payable in full upon completion of the Disposal.  The
consideration is subject only to adjustment to reflect movements in
working capital on completion.

Storehouse has agreed that it will pay Measuremarket a fee of £15
million if the Disposal is not approved by Storehouse's Shareholders.

3.   Background to and reasons for the Disposal

In November 1999 the Board of Storehouse announced that it had
completed a fundamental review of the Group, its businesses and the
markets in which they operate.  The review considered options and
proposals for the Group's corporate structure including the sale of
its businesses, merger opportunities and demerger.  The Board
concluded that Shareholders' interests would be best served by
restructuring and repositioning Bhs and Mothercare to operate in the
future as separate, independent companies, at which time Storehouse
would be dissolved.

Since then Storehouse has received approaches from a number of parties
expressing interest in acquiring the whole or parts of the Group. The
Board reviewed these approaches in the context of the continuing
underperformance of Bhs and its likely future prospects and concluded
that the proposed sale of Bhs to Philip Green delivered the best
option for Shareholders.  The Board also took into account the
purchaser's intention to continue to run the business as a large-space
high street retailer which is in the interests of Bhs employees.

The beneficial effects of the Disposal to the on-going Group will be
substantial.  The recovery programme at Mothercare, which will restore
Mothercare's brand position as a destination store for all the needs
of parents and small children, is well underway.  The successful
Mothercare World format is being expanded, Mothercare International is
growing and Mothercare Direct will be much enhanced with the launch of
Mothercare.com in June.  As a result of the Disposal of Bhs,
Storehouse management and financial resources can be dedicated solely
to the acceleration of this programme.

4.   Financial effects of the Disposal

Following the Disposal, Storehouse intends to return approximately
£100 million of the proceeds to Shareholders.  It is proposed that the
return of capital will be effected by means of a capital reduction, to
be implemented via a Scheme of Arrangement under Section 425 of the
Companies Act 1985.  The balance of the proceeds, net of costs, will
be used to repay Group debt, which amounted to approximately £70
million as at 31 March 2000, and for use in the continuing development
of Mothercare.

5.   Information on Bhs

Bhs is a UK retailer principally of clothing and home products.  Bhs
operates through 161 stores in the UK and via 47 stores outside the UK
with 11 franchise partners in 14 countries.

In the 28 weeks ended 9 October 1999, Bhs recorded turnover of £370.7
million and generated a retail loss before exceptional items of £8.3
million.  In the year ended 27 March 1999 Bhs recorded turnover of
£856.2 million and generated retail profit before exceptional items of
£86.4 million.  As at 27 March 1999 Bhs had net assets of £496.9
million.

6.   Other information

The Disposal is conditional, inter alia, upon the approval of
Storehouse's shareholders.

Further details of the Disposal will be contained in a circular which
will be posted to Storehouse Shareholders as soon as practicable.

Documents setting out the procedures and resolutions required to
effect the return of capital will be sent to Shareholders following
completion of the Disposal.

Storehouse has been advised on the Disposal by Schroders and Merrill
Lynch.  Cazenove & Co. are broker to the Company.