Proposed Subscription

Mulberry Group PLC
17 August 2000


MULBERRY  GROUP PLC ('MULBERRY' OR THE 'COMPANY'  OR  THE
'GROUP')
PROPOSED SUBSCRIPTION FOR £7.6 MILLION BY CHALLICE
LIMITED ('CHALLICE'), A COMPANY WHOLLY OWNED BY THE ONGS
JOINT VENTURE COMPANY TO BE SET UP IN THE UNITED STATES

Mulberry  announces  today that, subject  to  shareholder
approval, it has entered into an agreement under which an
international organisation specialising in  luxury  goods
and  fashion, owned by Mr Ong Beng Seng and Mrs Christina
Ong, has agreed to invest £7.6 million in the UK Group.

In  addition to the proposed investment Mulberry and  the
Ongs  will  enter  into  a  joint  venture  agreement  to
establish  a  business  in the US  to  promote  and  sell
Mulberry's products (the 'Joint Venture').

The  initial objective of the Joint Venture  is  to  open
five  points of sale for Mulberry products in the  United
States,  one  of  which  is to be  a  flagship  store  in
Manhattan, New York.

This  will  enable Mulberry to enter the American  market
with  substantial financial backing, limited risk, but  a
50%  share  of the ongoing business.  The development  of
the  US market has been an objective of the group  for  a
number  of  years, and the Joint Venture will enable  the
market  to be developed within the limited risk  criteria
set by the directors.
          
Mulberry  and  the Ongs will each own  one  half  of  the
shares  in  the  US Joint Venture company and  will  each
invest  US  $1  million as equity and  loan  capital,  on
identical  terms to each other.  Substantial  funding  in
excess  of the initial capital of US $2 million  will  be
required  to  develop  the  US business.  All  additional
funding required will be lent to the Joint Venture by the
Ongs or an entity associated with the Ongs.

Roger  Saul,  Chairman  and Chief Executive  of  Mulberry
commented:

'We  already have a loyal following of US customers.  The
formation of a joint venture company targeting the United
States  market has been a key objective for a  number  of
years  and  this  can now be completed by  Mulberry  with
considerable financial backing and also on a limited risk
basis. The Ongs have a very successful retail business in
the   US   with  an  experienced  management   team   and
established  logistics. This is a great  opportunity  for
Mulberry.'

'The   joint   venture  with  the  Ongs  represents   the
conclusion  of the first phase of the strategy  to  build
Mulberry  into a world brand, following on from  existing
partnerships  with Kravet in the United  States  on  home
furnishings and Toray Industries in Japan.'

FOR FURTHER INFORMATION:

Richard Thompson / Mark Taylor
Teather & Greenwood Limited   020 7426 9000

David Wynne-Morgan
WMC Communications            020 7591 3999

MULBERRY  GROUP PLC ('MULBERRY' OR THE 'COMPANY'  OR  THE
'GROUP')
PROPOSED SUBSCRIPTION FOR £7.6 MILLION BY CHALLICE
LIMITED ('CHALLICE'), A COMPANY WHOLLY OWNED BY THE ONGS
JOINT VENTURE COMPANY TO BE SET UP IN THE UNITED STATES

INTRODUCTION

Mulberry  announced  today that, subject  to  shareholder
approval,  it has entered into an agreement  under  which
Challice has conditionally agreed to invest £7.6  million
in the Company, by subscribing in cash for 15,000,000 new
ordinary  shares  at a price of 32 pence  per  share  and
8,000,000  new preference shares at a price of  35  pence
per  share.   On  completion of the  proposed  investment
Mulberry  and  Challice will enter into a  joint  venture
agreement  to establish a business in the US  to  promote
and sell Mulberry's products (the 'Joint Venture').

TERMS OF THE SUBSCRIPTION

In   accordance  with  the  terms  of  the   subscription
agreement,  Challice,  wholly owned  by  the  Ongs,  will
subscribe in cash for 15,000,000 new ordinary shares at a
price  of 32 pence per share and 8,000,000 new preference
shares at a price of 35 pence per share. On completion of
the subscription, Challice will hold 41.7 per cent of the
Company's issued ordinary shares and will appoint two non-
executive  directors, Mr Tom Vaughan and Mr Bernard  Heng
to  the  Board  of  Mulberry.   The  management  team  at
Mulberry  remains  unchanged.   Roger  Saul  retains  the
position of Chairman and Chief Executive. Assuming all of
the  new  preference shares are converted  into  ordinary
shares, Challice would hold a maximum of 52.3 per cent of
the Company's issued share capital. The preference shares
can  only be converted after two years provided that  the
Joint Venture Company has opened five outlets including a
flagship store in Manhattan.

The  subscription is conditional upon the passing of  the
special  resolution at the extraordinary general  meeting
of  the Company to be convened for 11 September 2000  and
on  admission  of the new ordinary shares to  trading  on
AIM.

THE JOINT VENTURE

The  Joint  Venture's initial objective is to  open  five
points  of  sale  for  Mulberry products  in  the  United
States,  one  of  which  is to be  a  flagship  store  in
Manhattan, New York.
          
Mulberry  and  Challice will each own  one  half  of  the
shares  in the Joint Venture Company and will each invest
US  $1  million as equity and loan capital, on  identical
terms to each other.  To the extent that more than US  $2
million is required, it will be lent to the Joint Venture
by or an entity associated with Challice

INFORMATION ON CHALLICE

Challice is a private limited company incorporated in
Gibraltar, which is wholly owned by Mr. Ong Beng Seng and
Mrs. Christina Ong.  Their family businesses, which
operate world wide, include oil trading, real estate
development, hotel development and ownership and luxury
branded goods.

BACKGROUND TO AND REASONS FOR THE SUBSCRIPTION

The directors believe that the proposed Subscription
brings three major benefits to the Group:

1.The balance sheet will be substantially degeared by the
  cash injection of £7,600,000.  The net bank borrowings of
  the Group at 31 March 2000 were £7,700,000.  As a result,
  the Group will have substantial facilities available for
  its  future  development following  completion  of  the
  transaction.

2.The   Joint  Venture  to  develop  the  US  market  for
  Mulberry's products will enable the Group to enter this
  market  with substantial financial backing on a limited
  risk basis whilst enjoying a 50 per cent. share in  the
  on-going business.  A key element of the Joint  Venture
  is that Mulberry's financial exposure is limited to the
  investment of US$1 million.  The development of the  US
  market  has been an objective of the Group for a number
  of years and the Joint Venture achieves both the market
  development  opportunity and the limited risk  criteria
  set by the directors.

3.The Group will have access to a strong international
  business network, which has particular strengths in the
  Far East, the US and in the UK.

Mulberry    has    previously    announced    significant
international  partnerships with Kravets  in  the  United
States,  to  licence  its  fabric,  wallpapers  and  soft
furnishings  and  Toray Industries in Japan.   The  Joint
Venture   with   Challice   represents   the   successful
conclusion of the first phase of the strategy of building
Mulberry as a world-wide brand through partnerships  with
major  international organisations,  which  add  specific
complementary skills and resources to the Group.


FURTHER INFORMATION

In  view  of  the  size of the proposed  subscription  by
Challice,  the subscription is conditional,  inter  alia,
upon  the approval of shareholders and admission  of  the
new  ordinary  shares  to trading on  AIM.   Furthermore,
under  Rule 9 of the City Code on Takeovers and  Mergers,
unless  a  specific waiver is obtained from the Panel  on
Takeovers and Mergers and approved by shareholders, on  a
poll,  Challice  would  normally be  obliged  to  make  a
mandatory offer for the Company.

A  circular  will  be  issued by  Mulberry  and  sent  to
shareholders today giving further details of the proposed
subscription   and  joint  venture  with   Challice   and
convening  an  extraordinary  general  meeting   of   the
Company.  At the extraordinary general meeting a  Special
Resolution will be proposed to seek Shareholders' consent
to:

a waiver of Rule 9 by the Panel;

the  proposed  subscription  by  Challice  for  the  new
  ordinary shares and the new preference shares;

increase the authorised share capital of the Company  to
  allow the proposed subscription to proceed and give the
  directors authority to allot the new shares; and

the adoption of new articles of association by Mulberry.

For further information:

Richard Thompson / Mark Taylor
Teather & Greenwood Limited   020 7426 9000

David Wynne-Morgan
WMC Communications            020 7591 3999