Offer for Berkeley Morgan

Personal Group Holdings PLC
10 December 2004

                             For immediate release

                                  Part 1 of 2



   Not for release, publication or distribution in or into or from the United
      States, Canada, Australia, Republic of Ireland or Japan or any other
 jurisdiction if to do so would constitute a violation of the relevant laws of
                               such jurisdiction



                                                                10 December 2004

                          Personal Group Holdings plc



Recommended £12.3 million cash offer for Berkeley Morgan Group plc to be made by
           Durlacher Limited on behalf of Personal Group Holdings plc



Summary



  • The Offer will be 105 pence in cash for each Berkeley Morgan Share. On
    this basis, the Offer values the issued share capital of Berkeley Morgan at
    approximately £12.3 million.
  • The Offer represents a premium of approximately 30 per cent. over the
    Closing Price of 81 pence per Berkeley Morgan Share on 9 December 2004, the
    last dealing day prior to the date of this announcement.
  • The Offer represents a premium of approximately 51 per cent. over the
    average Closing Price of 69.4 pence (Source: Bloomberg) per Berkeley Morgan
    Share for the 3 month period prior to the date of this announcement.
  • Personal Group has received irrevocable undertakings to accept the Offer
    from Berkeley Morgan Shareholders (including all executive members of the
    Berkeley Morgan Board and Berkeley Morgan's principal institutional
    shareholder) in respect of, in aggregate, 9,120,681 Berkeley Morgan Shares,
    representing approximately 78 per cent. of the issued share capital of
    Berkeley Morgan.
  • The Offer has been unanimously recommended by the Berkeley Morgan Board.
  • Following the Offer becoming or being declared unconditional in all
    respects, the Personal Group Directors plan to appoint Jon Pardoe, Chairman
    and Chief Executive of Berkeley Morgan, to the Personal Group Board.
  • The formal documentation relating to the Offer (including the Offer
    Document and Form of Acceptance), which will contain advice to Berkeley
    Morgan Shareholders from the Berkeley Morgan Board, is expected to be
    dispatched to Berkeley Morgan Shareholders (other than certain Overseas
    Shareholders) shortly.
  • Christopher Johnston, Chairman of Personal Group commented 'This proposed
    acquisition is an excellent opportunity for Personal Group shareholders to
    gain exposure to a business with a successful track record and product
    strengths that both complement and augment our existing business, whilst
    enhancing earnings.'
  • Jon Pardoe, Chairman and Chief Executive of Berkeley Morgan, commented 'I
    am delighted that we have secured what I consider to be a very fair price
    for our shareholders. I look forward to the future of Berkeley Morgan, as
    part of Personal Group, with great confidence.'



This summary should be read in conjunction with the full text of the following
announcement. Appendix 2 to the following announcement contains definitions of
certain expressions used in this summary and the following announcement.



Enquiries:



Christopher Johnston, Chairman of Personal Group              Tel: [phone]

Grant Harrison / Jonathan Retter / Marcus Jackson,            Tel: [phone]
Durlacher Limited                                             
(Financial Adviser to Personal Group)

Simon Rothschild, Bankside                                    Tel: [phone]
(Public Relations Adviser to Personal Group)

Jon Pardoe, Chairman and Chief Executive of Berkeley Morgan   Tel: [phone]

Michael Cobb / Shaun Claydon, BDO Stoy Hayward                Tel: [phone]
Corporate Finance                                             
(Financial Adviser to Berkeley Morgan)

Isabel Crossley, St Brides Media & Finance                    Tel: [phone]
(Public Relations Adviser to Berkeley Morgan)

Durlacher, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting for Personal Group and no-one else in
connection with the Offer and will not be responsible to anyone other than
Personal Group for providing the protections afforded to clients of Durlacher
nor for providing advice in relation to the Offer or in relation to the contents
of this announcement or any matter referred to herein.

BDO Stoy Hayward Corporate Finance, a division of BDO Stoy Hayward LLP,
Chartered Accountants, which is authorised and regulated in the United Kingdom
by the Financial Services Authority, is acting for Berkeley Morgan and no-one
else in connection with the Offer and will not be responsible to anyone other
than Berkeley Morgan for providing the protections afforded to clients of BDO
Stoy Hayward Corporate Finance nor for providing advice in relation to the Offer
or in relation to the contents of this announcement or any matter referred to
herein.



The Offer will not be made, directly or indirectly, and this announcement should
not be sent, in or into or from the United States, Canada, Australia, the
Republic of Ireland or Japan or by use of the mails of or by any means or
instrumentality (including, without limitation, facsimile transmission, telex,
telephone or e-mail) of interstate or foreign commerce of, or any facilities of
a national securities exchange of, any of these jurisdictions and doing so may
render invalid any purported acceptance of the Offer. Accordingly, copies of
this announcement and any other document relating to the Offer are not being,
and must not be, marked or otherwise distributed or sent in or into the United
States, Canada, Australia, the Republic of Ireland or Japan. Any person
(including, without limitation, custodians, nominees and trustees) who may have
contractual or legal obligations, or may otherwise intend, to forward this
announcement to any jurisdiction outside the United Kingdom should read the
relevant provisions of the Offer Document before taking any action.



The availability of the Offer to persons not resident in the United Kingdom may
be affected by the laws of the relevant jurisdictions in which they are located.
Persons who are (or who are nominees, custodians or trustees for) citizens,
nationals or residents of countries outside the United Kingdom should inform
themselves about and observe any applicable legal or regulatory requirements in
relation to this announcement and the Offer.



This announcement is not intended to and does not constitute, or form part of,
an offer or an invitation to purchase any securities.





                                  Part 2 of 2

   Not for release, publication or distribution in or into or from the United
      States, Canada, Australia, Republic of Ireland or Japan or any other
 jurisdiction if to do so would constitute a violation of the relevant laws of
                               such jurisdiction



                                                                10 December 2004

                          Personal Group Holdings plc



Recommended £12.3 million cash offer for Berkeley Morgan Group plc to be made by
           Durlacher Limited on behalf of Personal Group Holdings plc



 1. Introduction

The boards of Personal Group and Berkeley Morgan are pleased to announce a
recommended cash offer to be made by Durlacher on behalf of Personal Group for
the issued and to be issued share capital of Berkeley Morgan. The Offer is 105
pence per Berkeley Morgan Share and values the issued share capital of Berkeley
Morgan at approximately £12.3 million.



Personal Group has received from Berkeley Morgan Shareholders irrevocable
undertakings to accept the Offer in respect of 9,120,681 Berkeley Morgan Shares,
representing approximately 78 per cent. of the issued share capital of Berkeley
Morgan.





 2. Terms of the Offer

The Offer, which will be made on the terms and subject to the conditions set out
in Appendix 1 to this announcement and the further terms which will be set out
in the Offer Document and in the Form of Acceptance, will be made on the
following basis:



for each Berkeley Morgan Share                         105 pence in cash



On this basis, the Offer values the issued share capital of Berkeley Morgan at
approximately £12.3 million.



The Offer represents a premium of approximately 30 per cent. over the Closing
Price of 81 pence per Berkeley Morgan Share on 9 December 2004, being the last
dealing day prior to the release of this announcement. The Berkeley Morgan
Shares are to be acquired, pursuant to the Offer, fully paid and free from all
liens, charges, equitable interests, encumbrances, rights of pre-emption and
other third party rights or interests of any nature whatsoever and together with
all rights now or hereafter attaching to them including the right to receive and
retain all dividends and other distributions.



The Offer will extend to any Berkeley Morgan Shares which are unconditionally
allotted or issued fully paid (or credited as fully paid) prior to the date on
which the Offer closes (or such earlier date as Personal Group may, subject to
the City Code, determine being not earlier than the date on which the Offer
becomes or is declared unconditional as to acceptances or, if later, the First
Closing Date) pursuant to the exercise of options under the Berkeley Morgan
Share Option Scheme or otherwise. If the Offer becomes or is declared
unconditional in all respects, to the extent that options remain unexercised,
Personal Group intends to make appropriate proposals to all Berkeley Morgan
Option Holders in due course.





 3. Irrevocable undertakings

Personal Group has received from Berkeley Morgan Shareholders irrevocable
undertakings to accept the Offer in respect of 9,120,681 Berkeley Morgan Shares,
representing 78 per cent. of the issued share capital of Berkeley Morgan. These
comprise:



  • an irrevocable undertaking from Jon Pardoe, Berkeley Morgan's chairman and
    chief executive, to accept the Offer in respect of his personal beneficial
    shareholding in Berkeley Morgan, amounting to 4,631,055 Berkeley Morgan
    Shares, representing 39.6 per cent. of the issued share capital of Berkeley
    Morgan;
  • an irrevocable undertaking from Simon Ingman, Berkeley Morgan's finance
    director, to accept the Offer in respect of his personal beneficial
    shareholding in Berkeley Morgan, amounting to 116,809 Berkeley Morgan
    Shares, representing approximately 1.0 per cent. of the issued share capital
    of Berkeley Morgan;
  • an irrevocable undertaking from Electra to accept the Offer in respect of
    2,067,708 Berkeley Morgan Shares, representing approximately 17.7 per cent.
    of the issued share capital of Berkeley Morgan; and
  • irrevocable undertakings from certain other individuals and employees of
    Berkeley Morgan to accept the Offer in respect of 2,305,109 Berkeley Morgan
    Shares, representing approximately 19.7 per cent. of the issued share
    capital of Berkeley Morgan.



In aggregate, therefore, Personal Group has received irrevocable undertakings to
accept the Offer in respect of 9,120,681 Berkeley Morgan Shares, representing
approximately 78 per cent. of the issued share capital of Berkeley Morgan.



The irrevocable undertakings given by Jon Pardoe and Simon Ingman in respect of
their personal beneficial shareholdings will only cease to be binding if the
Offer lapses or is withdrawn.



The irrevocable undertaking to accept the Offer given by Electra will cease to
be binding if the Offer lapses or is withdrawn or if at any time before the
Offer becomes or is declared unconditional in all respects, an improved offer is
announced in accordance with Rule 2.5 of the Code at a price per Berkeley Morgan
Share of not less than 115.5 pence.



All other irrevocable undertakings will cease to be binding if the Offer lapses
or is withdrawn or if at any time before the Offer becomes or is declared
unconditional in all respects, any improved offer is announced.





 4. Recommendation

The Berkeley Morgan Directors, who have been so advised by BDO Stoy Hayward
Corporate Finance, consider the terms of the Offer to be fair and reasonable. In
providing its advice, BDO Stoy Hayward Corporate Finance has taken into account
the commercial assessments of the Berkeley Morgan Directors.



Accordingly the Berkeley Morgan Directors will unanimously recommend that
Berkeley Morgan Shareholders accept the Offer, as Jon Pardoe (chairman and chief
executive) and Simon Ingman (finance director) have irrevocably undertaken to do
in respect of their own beneficial holdings of, in aggregate, 4,747,864 Berkeley
Morgan Shares, representing 40.6 per cent. of the issued share capital of
Berkeley Morgan.





 5. Background to and reasons for the Offer

Personal Group has maintained steady growth since it was established in 1984
providing employee benefit programmes to employers.



The Personal Group Board believes that the Acquisition will allow Personal Group
to extend the range of insurance-related products it can offer, which can be
made available to employee group members being serviced by its all employee
benefit programmes and further enhance the options available via the internet/
intranet using Personal Group's Perflex flexible benefit software.



The Personal Group Board believes Berkeley Morgan will add a business with its
own markets, insurance products and sales team to Personal Group.





 6. Reasons for the Recommendation by Berkeley Morgan



As is evident from the interim results announced today, Berkeley Morgan has
continued its recovery from a period of poor performance.



Although it is possible that this improvement in performance would be reflected
in due course by the market in terms of an increased share price, the proposal
from Personal Group is at a level that the shares have not reached for over two
years. Moreover the Offer represents an approximate 30 per cent. premium to
yesterday's Closing Price and provides Berkeley Morgan Shareholders with cash
and the opportunity to sell their shares free of any dealing costs.



The Berkeley Morgan Board considers that the Offer provides certainty now at an
attractive price in cash which should be extended to all shareholders. In
addition, in view of the fact that, in aggregate, shareholders representing
approximately 78 per cent. of Berkeley Morgan's issued share capital have
irrevocably undertaken to accept the Offer, the Berkeley Morgan Board considers
that it is in the best interests of all other Berkeley Morgan Shareholders to
accept the Offer.





 7. Financing of the Offer

Full acceptance of the Offer, assuming all existing share options are exercised
in full under the terms of the Berkeley Morgan Share Option Scheme, would result
in a maximum cash consideration of approximately £12.4 million being payable to
Berkeley Morgan Shareholders.



The consideration payable under the Offer is being financed by a combination of
Personal Group's existing cash resources and an acquisition facility being made
available by the Royal Bank of Scotland pursuant to the Facility Agreement.



Durlacher is satisfied that the necessary financial resources are available to
Personal Group for it to implement the Offer in full.





 8. Information on Personal Group

Personal Group was founded in 1984 by Christopher Johnston and John Ormond. In
November 2000 Personal Group was admitted to trading on AIM.



The range of services offered by Personal Group and its subsidiaries include:



  • employee benefit solutions;
  • accident and health insurance;
  • general insurance and reinsurance broking;
  • independent financial advice; and
  • mortgage advice service.



Personal Group has made a profit every year since 1986. In the year to 31
December 2003, Personal Group had trading income of £12.9 million.





 9. Information on Berkeley Morgan

Berkeley Morgan's principal activity is the provision of financial planning
advice and the supply and packaging of medical and general insurance services.



Berkeley Morgan has also announced today its interim results for the six months
to 31 October 2004. The interim results reported turnover of £7.8 million (2003:
£8.2 million), profit before tax of £1.5 million (2003: £0.7 million ) and net
assets of £3.5 million.



In the financial year ended 30 April 2004, Berkeley Morgan reported a turnover
from continuing activities of £16.5 million and achieved profit before tax from
continuing activities of £1.3 million. As at that date Berkeley Morgan had net
assets of £2.4 million.





10. Personal Group Shareholder Approval

Due to its size the Acquisition will not be classed as a reverse takeover
pursuant to Rule 13 of the AIM Rules. As a result, the Acquisition will not be
subject to approval by Personal Group's shareholders.





11. Directors, management and employees

Personal Group has given assurances to the Berkeley Morgan Directors that,
following the Offer becoming or being declared unconditional in all respects,
the existing employment rights, including pension rights, of the directors and
employees of Berkeley Morgan will be fully safeguarded.



The Personal Group Directors have invited Jon Pardoe, chairman and chief
executive of Berkeley Morgan, to join the board of the enlarged group once the
Offer has become, or been declared, unconditional in all respects.





12. New bonus arrangements for Jon Pardoe and key Berkeley Morgan employees and
    consultants

Personal Group is keen to ensure that the results achieved by Berkeley Morgan
can be built on going forward. Given the fact that Berkeley Morgan is a people
business, Personal Group recognises the importance of retaining and
incentivising the key personnel in the Berkeley Morgan Group who are primarily
responsible for generating business and for maintaining relationships with
suppliers, clients, potential clients and key intermediaries.



Proposed bonus arrangements for Jon Pardoe, certain other current employees and
the current self-employed sales consultants have been agreed with Personal Group
and will come into effect (in the case of consultants in place of the existing
share option scheme) once the Offer becomes, or is declared, unconditional in
all respects. Full details of these bonus arrangements will be included in the
Offer Document to be dispatched shortly to Berkeley Morgan Shareholders.





13. Berkeley Morgan Share Option Scheme

The Offer will extend to any Berkeley Morgan Shares which are unconditionally
allotted or issued fully paid (or credited as fully paid) prior to the date on
which the Offer closes (or such earlier date as Personal Group may, subject to
the City Code, determine being not earlier than the date on which the Offer
becomes or is declared unconditional as to acceptances or, if later, the First
Closing Date) pursuant to the exercise of options under the Berkeley Morgan
Share Option Scheme or otherwise. If the Offer becomes or is declared
unconditional in all respects, to the extent that options remain unexercised,
Personal Group intends to make appropriate proposals to all Berkeley Morgan
Option Holders in due course.





14. Compulsory acquisition and dealings

Berkeley Morgan Shareholders should note that if Personal Group receives
acceptances under the Offer in respect of, and/or otherwise acquires 90 per
cent. or more of the Berkeley Morgan Shares to which the Offer relates, Personal
Group intends to exercise its rights under sections 428 to 430F of the Act to
compulsorily acquire the remaining Berkeley Morgan Shares.



Berkeley Morgan Shareholders should also note that Personal Group intends to
procure that Berkeley Morgan applies to OFEX for the cancellation of the
admission of Berkeley Morgan Shares to trading on OFEX not less than 15 business
days following the date on which the Offer becomes or is declared unconditional
in all respects. Berkeley Morgan Shareholders should note that cancellation of
such admission would significantly reduce the liquidity and marketability of any
Berkeley Morgan Shares in respect of which acceptances of the Offer are not
validly made. Personal Group also intends to procure the re-registration of
Berkeley Morgan as a private company under the relevant provisions of the Act.





15. General

The Offer will be open for at least 21 days from the date of the Offer Document.
Personal Group intends to dispatch the Offer Document, setting out full details
of the Offer, and the Form of Acceptance to Berkeley Morgan Shareholders as soon
as reasonably practicable.



Appendix 2 contains definitions of the terms used in this announcement.





Enquiries:



Christopher Johnston, Chairman of Personal Group              Tel: [phone]

Grant Harrison / Jonathan Retter / Marcus Jackson,            Tel: [phone]
Durlacher Limited                             
(Financial Adviser to Personal Group)

Simon Rothschild, Bankside                                    Tel: [phone]
(Public Relations Adviser to Personal Group)

Jon Pardoe, Chairman and Chief Executive of Berkeley Morgan   Tel: [phone]

Michael Cobb / Shaun Claydon, BDO Stoy Hayward                Tel: [phone]
Corporate Finance     
(Financial Adviser to Berkeley Morgan)

Isabel Crossley, St Brides Media & Finance                    Tel: [phone]
(Public Relations Adviser to Berkeley Morgan)





Durlacher, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting for Personal Group and no-one else in
connection with the Offer and will not be responsible to anyone other than
Personal Group for providing the protections afforded to clients of Durlacher
nor for providing advice in relation to the Offer or in relation to the contents
of this announcement or any matter referred to herein.



BDO Stoy Hayward Corporate Finance, a division of BDO Stoy Hayward LLP,
Chartered Accountants, which is authorised and regulated in the United Kingdom
by the Financial Services Authority, is acting for Berkeley Morgan and no-one
else in connection with the Offer and will not be responsible to anyone other
than Berkeley Morgan for providing the protections afforded to clients of BDO
Stoy Hayward Corporate Finance nor for providing advice in relation to the Offer
or in relation to the contents of this announcement or any matter referred to
herein.



The Offer will not be made, directly or indirectly, and this announcement should
not be sent, in or into or from the United States, Canada, Australia, the
Republic of Ireland or Japan or by use of the mails of or by any means or
instrumentality (including, without limitation, facsimile transmission, telex,
telephone or e-mail) of interstate or foreign commerce of, or any facilities of
a national securities exchange of, any of these jurisdictions and doing so may
render invalid any purported acceptance of the Offer. Accordingly, copies of
this announcement and any other document relating to the Offer are not being,
and must not be, marked or otherwise distributed or sent in or into the United
States, Canada, Australia, the Republic of Ireland or Japan. Any person
(including, without limitation, custodians, nominees and trustees) who may have
contractual or legal obligations, or may otherwise intend, to forward this
announcement to any jurisdiction outside the United Kingdom should read the
relevant provisions of the Offer Document before taking any action.



The availability of the Offer to persons not resident in the United Kingdom may
be affected by the laws of the relevant jurisdictions in which they are located.
Persons who are not resident in the United Kingdom should inform themselves
about and observe any applicable requirements.



This announcement is not intended to and does not constitute, or form part of,
an offer or an invitation to purchase any securities.



The directors of Personal Group accept responsibility for the information
relating to Personal Group contained in this announcement. To the best of the
knowledge and belief of such persons (who have taken all reasonable care to
ensure that such is the case) such information is in accordance with the facts
and does not omit anything likely to affect the import of such information.



The directors of Berkeley Morgan accept responsibility for the information
relating to Berkeley Morgan contained in this announcement. To the best of the
knowledge and belief of such persons (who have taken all reasonable care to
ensure that such is the case) such information is in accordance with the facts
and does not omit anything likely to affect the import of such information.



The Offer will be subject to the terms and conditions set out in Appendix 1 to
this announcement and to the further terms which will be set out in the Offer
Document.





Appendix 1





1. Conditions and certain terms of the Offer

The Offer will comply with the applicable rules and regulations of the Code,
will be governed by English law and will be subject to the jurisdiction of the
Courts of England and Wales. The Offer will be subject to the terms and
conditions set out in this announcement and to be set out in the Offer Document
and the Form of Acceptance and will be subject to the following conditions:



a)       valid acceptances being received (and not, where permitted, withdrawn)
by no later than 3.00 p.m. on the First Closing Date (or such later time(s) and/
or date(s) as Personal Group may, subject to the rules of the Code, decide) in
respect of not less than 90 per cent. in nominal value (or such lesser
percentage as Personal Group may decide) of the Berkeley Morgan Shares to which
the Offer relates, provided that this condition shall not be satisfied unless
Personal Group and/or its wholly owned subsidiaries shall have acquired or
agreed to acquire, whether pursuant to the Offer or otherwise, Berkeley Morgan
Shares carrying, in aggregate, more than 50 per cent. of the voting rights
normally exercisable at general meetings of Berkeley Morgan, including for this
purpose (to the extent, if any, required by the Panel) any such voting rights
attaching to any Berkeley Morgan Shares which are unconditionally allotted or
issued fully paid (or credited as fully paid) before the Offer becomes or is
declared unconditional as to acceptances, whether pursuant to the exercise of
any subscription or conversion rights or otherwise. For the purposes of this
condition:



                               (i)      the expression ''Berkeley Morgan Shares
to which the Offer relates'' shall be construed in accordance with sections
428-430F (inclusive) of the Act; and



                             (ii)      Berkeley Morgan Shares which have been
unconditionally allotted but not issued shall be deemed to carry the voting
rights which they will carry on issue;



b)       without limitation to condition (d) below, Personal Group not having
discovered or otherwise become aware prior to the date when the Offer would
otherwise have become or been declared unconditional that the Office of Fair
Trading intends, or is reasonably likely, to refer the proposed acquisition of
Berkeley Morgan by Personal Group, or any matters arising therefrom, to the
Competition Commission pursuant to section 33 of the Enterprise Act 2002;



c)       save as disclosed in Berkeley Morgan's annual report and accounts for
the year ended 30 April 2004, the unaudited interim results of Berkeley Morgan
for the period ending 31 October 2004 announced today, or as publicly announced
by Berkeley Morgan by the delivery of an announcement to a Regulatory
Information Service prior to today, or as fairly disclosed in writing to
Personal Group or its financial or professional advisers prior to today (such
public announcements, disclosures or  information being referred to in these
terms and conditions as being ''revealed''), there being no provision of any
agreement, authorisation, arrangement, franchise, consent, lease, licence,
permit or other instrument to which any member of the Wider Berkeley Morgan
Group is a party or by or to which any such member or any of its assets may be
bound, entitled or subject, which as a result of the Offer or the proposed
acquisition by Personal Group of any shares in, or control of, Berkeley Morgan
or otherwise, is reasonably likely to result (in each case to an extent which is
material in the context of the Wider Berkeley Morgan Group taken as a whole) in:



                               (i)      any monies borrowed by, or any other
indebtedness, actual or contingent, of or any grant available to, any such
member being or becoming repayable or capable of being declared repayable
immediately or earlier than its stated maturity date, or the ability of any such
member to borrow monies or incur any indebtedness being withdrawn, prohibited or
inhibited or becoming capable of being withdrawn, prohibited or inhibited;



                             (ii)      any such agreement, authorisation,
arrangement, franchise, consent, licence, permit or instrument or the rights,
liabilities, obligations or interests of any such member thereunder being or
becoming capable of being terminated or adversely modified or affected;



                            (iii)      the business of any such member in or
with any other person, firm, company or body (or any arrangements relating to
such business) being terminated, modified or adversely affected;



                           (iv)      any material assets or material interests
of any such member being or falling to be disposed of or charged or ceasing to
be available to any such member or any right arising under which any such asset
or interest could be required to be disposed of or charged or could cease to be
available to any such member otherwise than in the ordinary course of business;



                             (v)      the creation of any mortgage, charge or
other security interest over the whole or any part of the business, property or
assets of any such member or any such security (whenever created, arising or
having arisen) becoming enforceable or being enforced;



                           (vi)      the financial or trading position or
profits of any member of the Wider Berkeley Morgan Group being prejudiced or
adversely affected;



                          (vii)      the creation of any material liabilities
(actual or contingent) (other than in the ordinary course of business) by any
member of the Wider Berkeley Morgan Group;



                        (viii)      any such member ceasing to be able to carry
on business under any name under which it presently does;



and no event having occurred which, under any provisions of any such
arrangement, authorisation agreement, licence, consent, lease, permit, franchise
or other instrument, would result in any of the events or circumstances which
are referred to in paragraph (i) to (viii) of this condition (c) in any case to
an extent which is or would be material in the context of the Wider Berkeley
Morgan Group taken as a whole;



d)       no government, government department or governmental,
quasi-governmental, supranational, statutory, regulatory, environmental or
investigative body or authority (including, without limitation, any national
anti-trust or merger control authority), court, trade agency, institution or any
other similar body or person whatsoever in any jurisdiction (each a ''Third
Party'' and all collectively ''Third Parties'') having instituted or implemented
or threatened, or having decided to institute or implement or threaten, any
action, proceeding, suit, investigation, enquiry or reference or having made,
proposed or enacted any statute, regulation, order or decision or taken any
other steps which is reasonably likely to (in each case to an extent which is
material in the context of the Wider Berkeley Morgan Group or the Wider Personal
Group, as the case may be, in each case taken as a whole):



                               (i)      make the Offer or its implementation or
the Acquisition or the proposed acquisition by Personal Group of all or any
Berkeley Morgan Shares, or the acquisition or proposed acquisition of other
securities in, or control of, Berkeley Morgan by Personal Group, void, illegal
and/or unenforceable under the laws of any relevant jurisdiction, or otherwise,
directly or indirectly, restrain, restrict, prohibit, challenge, frustrate,
delay or interfere with the same, or impose additional material conditions or
obligations with respect thereto, or otherwise require material amendment to the
terms of the Offer or any such acquisition (including, without limitation,
taking any steps which would entitle the Berkeley Morgan Board to require
Personal Group to dispose of all or some of its Berkeley Morgan Shares or
restrict the ability of Personal Group to exercise voting rights in respect of
some or all of such Berkeley Morgan Shares);



                             (ii)      require, prevent or delay the
divestiture, or alter the terms envisaged for any proposed divestiture, by any
member of the Wider Personal Group or any member of the Wider Berkeley Morgan
Group of all or any material portion of their respective businesses, assets  or
properties or impose any limitation on the ability of any of them to conduct
their respective businesses or to own any of their respective assets or property
to an extent which is material in the context of the Wider Personal Group or the
Wider Berkeley Morgan Group taken as a whole, respectively;



                            (iii)      impose any material limitation on, or
result in a delay in, the ability of any member of the Wider Personal Group to
acquire or hold or exercise effectively, directly or indirectly, all or any
rights of ownership in respect of shares or other securities (or the equivalent)
in any member of the Wider Berkeley Morgan Group or to exercise management
control over any such member;



                           (iv)      otherwise materially and adversely affect
in any respect any or all of the businesses, assets or profits of any member of
the Wider Personal Group or any member of the Wider Berkeley Morgan Group
respectively;



                             (v)      result in any member of the Wider Berkeley
Morgan Group ceasing to be able to carry on business or impose any limitation on
the ability of any member of the Wider Personal Group or any member of the Wider
Berkeley Morgan Group to integrate or co-ordinate its business, or any part of
it, with the business of any member of the Wider Berkeley Morgan Group or the
Wider Personal Group to an extent that is material in the context of the Wider
Personal Group or the Wider Berkeley Morgan Group;



                           (vi)      save pursuant to the Offer or Part XIIIA of
the Act, require any member of the Wider Personal Group or of the Wider Berkeley
Morgan Group to offer to acquire any shares or other securities) in any member
of the Wider Berkeley Morgan Group owned by any third party;



and all applicable waiting and other time periods during which any such Third
Party could take, institute, implement or threaten any action, proceeding, suit,
investigation, enquiry or reference under the laws of any relevant jurisdiction
or enact any such statute, regulation, order or decision or take any steps
having expired, lapsed or been terminated;



e)       all authorisations, orders, recognitions, grants, determinations,
consents, licences, confirmations, clearances, certificates, permissions and
approvals (each an ''Authorisation'') which are necessary in any relevant
jurisdiction for or in respect of the Offer or the proposed acquisition of any
shares  or other securities in, or control of, Berkeley Morgan or any other
member of the Wider Berkeley Morgan Group by any member of the Wider Personal
Group or the carrying on by any member of the Wider Berkeley Morgan Group of its
business having been obtained, in terms and in a form reasonably satisfactory to
Personal Group from all appropriate Third Parties or from any persons or bodies
with whom any member of the Wider Berkeley Morgan Group has entered into
contractual arrangements, in each case where the absence of such Authorisation
from such a person might have a material adverse effect on the Wider Berkeley
Morgan Group (taken as a whole) and all such Authorisations remaining in full
force and effect and there being no notice or intimation of any intention to
revoke, withdraw, withhold, suspend, restrict, modify, amend or not to renew any
of the same;



f)        all notifications and filings which are necessary having been made,
all appropriate waiting and other time periods (including any extensions of such
waiting and other time periods) under any applicable legislation or regulation
of any relevant jurisdiction having expired, lapsed or been terminated (as
appropriate) and all necessary statutory or regulatory obligations in any
relevant jurisdiction having been complied with in each case in connection with
the Offer or the Acquisition or the proposed acquisition of any shares or other
securities in, or control of, Berkeley Morgan or any other member of the Wider
Berkeley Morgan Group by any member of the Wider Personal Group where, in each
case, the absence of such compliance might have a material and adverse affect on
the business of any member of the Wider Berkeley Morgan Group;



g)       save as revealed, no member of the Wider Berkeley Morgan Group having:



                               (i)      (save as between Berkeley Morgan and
wholly-owned subsidiaries of Berkeley Morgan, or for options granted or on the
exercise of rights to subscribe for Berkeley Morgan Shares pursuant to the
exercise of options granted or the exercise of rights under the Berkeley Morgan
Share Option Scheme prior to the date hereof) issued, agreed to issue,
authorised or proposed the issue or grant of additional shares of any class, or
securities convertible into, or rights, warrants or options to subscribe for, or
acquire, any such shares or convertible securities or redeemed, purchased or
reduced or announced any proposal to redeem, purchase or reduce any part of its
share capital;



                             (ii)      recommended, declared, paid or made or
proposed to declare, pay or make any bonus, dividend or other distribution
whether payable in cash or otherwise, other than to Berkeley Morgan or
wholly-owned subsidiaries of Berkeley Morgan;



                            (iii)      (save as between Berkeley Morgan and
wholly-owned subsidiaries of Berkeley Morgan) merged with or demerged any body
corporate or acquired or disposed of or transferred, mortgaged or charged or
created any security interest over any assets or any rights, title or interest
in any asset (including shares and trade investments), or authorised or proposed
or announced any intention to propose any merger, demerger, acquisition,
disposal, transfer, mortgage, charge or the creation of any security interest
over the same (other than in the ordinary course of business and being material
in the context of the Wider Berkeley Morgan Group taken as a whole);



                           (iv)      (save as between Berkeley Morgan and
wholly-owned subsidiaries of Berkeley Morgan or for options granted or on the
exercise of rights to subscribe for Berkeley Morgan Shares pursuant to the
exercise of options granted or the exercise of rights under the Berkeley Morgan
Share Option Schemes prior to the date hereof) authorised or proposed, or
announced an intention to propose, any change in its share or loan capital
including the purchase of any of its own shares;



                             (v)      issued, authorised or proposed the issue
of or made any change in or to any debentures or incurred or increased any
indebtedness or become subject to a liability (actual or contingent) which in
any case is outside the ordinary course of business and material in the context
of the Wider Berkeley Morgan Group taken as a whole;



                           (vi)      entered into, implemented, effected,
varied, authorised or proposed any contract, reconstruction, amalgamation,
scheme, commitment, merger, demerger or other transaction or arrangement or
waived or compromised any claim in respect of itself or another member of the
Wider Berkeley Morgan Group, in each case otherwise than in the ordinary course
of business, which in any case is material in the context of the Wider Berkeley
Morgan Group taken as whole;



                          (vii)      proposed any voluntary winding up;



                        (viii)      terminated or varied the terms of any
agreement or arrangement between any member of the Wider Berkeley Morgan Group
and any other person in a manner which is likely to have a material adverse
effect on the position of the Wider Berkeley Morgan Group;



                            (ix)      proposed, agreed to provide or modified
the terms of any share option scheme, incentive scheme or other benefit relating
to the employment or termination of employment of any person employed by the
Wider Berkeley Morgan Group which, taken as a whole, are material in the context
of the Wider Berkeley Morgan Group taken as a whole;



                              (x)      entered into, varied, or authorised any
agreement, transaction, arrangement or commitment (whether in respect of capital
expenditure or otherwise) which:



A.      is of a long term, onerous or unusual nature or magnitude or which is or
could involve an obligation of such nature or magnitude; or



B.       is other than in the ordinary course of business;



and which in any such case is material in the context of the Wider Berkeley
Morgan Group taken as a whole;



                            (xi)      entered into or changed the terms of any
contract, agreement or arrangement with any director or senior executive of any
member of the Wider Berkeley Morgan Group in any material respect;



                           (xii)      taken any corporate action or had any
legal proceedings instituted or threatened against it or petition presented or
order made for its winding-up (voluntarily or otherwise), dissolution or
reorganisation or for the appointment of a receiver, trustee, administrator,
administrative receiver or similar officer of all or any material part of its
assets and revenues or any analogous or equivalent steps or proceedings in or
under the laws of any jurisdiction having occurred or there having been
appointed any analogous person in any jurisdiction which in any case is material
in the context of the Wider Berkeley Morgan Group taken as a whole;



                         (xiii)      been unable, or admitted in writing that it
is unable, to pay its debts generally or having stopped or suspended (or
threatened to stop or suspend) payment of its debts generally or ceased or
threatened to cease carrying on all or a substantial part of its business in any
case which is or would be material in the context of the Wider Berkeley Morgan
Group taken as a whole;



                         (xiv)      made any alteration to its memorandum and
articles of association which is material in the context of the Offer;



                          (xv)      entered into any agreement, contract,
commitment or arrangement which consents to or results in the restriction of the
scope of the business of any member of the Wider Berkeley Morgan Group or any
member of the Wider Personal Group which, in any such case, is material in the
context of the Wider Berkeley Morgan Group or the Wider Personal Group taken as
a whole, respectively;



                         (xvi)      entered into any agreement, commitment or
arrangement or passed any resolution or made any offer (which remains open for
acceptance) to enter into any agreement, commitment or arrangement or proposed
or announced any intention to effect any of the transactions, matters or events
referred to in this condition (g) which is material in the context of the Wider
Berkeley Morgan Group taken as a whole;



                       (xvii)      (other than in the ordinary course of
business) waived or compromised any claim which is material in the context of
the Wider Berkeley Morgan Group taken as a whole;



h)       save as revealed and only to the extent material in any case in the
context of the Wider Berkeley Morgan Group taken as a whole:



                               (i)      no material adverse change or
deterioration having occurred in the business, assets, financial or trading
position or profits of any member of the Wider Berkeley Morgan Group;



                             (ii)      no claim being made, and no circumstances
having arisen which might lend to a claim being made, under the insurance of any
member of the Wider Berkeley Morgan Group which might have a material adverse
effect on the Wider Berkeley Morgan Group;



                            (iii)      no litigation, arbitration proceedings,
prosecution or other legal proceedings or investigation having been instituted,
announced, implemented or threatened by or against or remaining outstanding
against any member of the Wider Berkeley Morgan Group or to which any member of
the Wider Berkeley Morgan Group is or may become a party (whether as plaintiff,
defendant or otherwise);



                           (iv)      no contingent or other liability of any
member of the Wider Berkeley Morgan Group having arisen or become apparent or
increased which in any such case might reasonably be expected materially and
adversely to affect any member of the Wider Berkeley Morgan Group;



                             (v)      (other than as a result of the Offer) no
enquiry or investigation by, or complaint or reference to, any Third Party
having been threatened, announced, implemented, instituted by or against or
remaining outstanding against or in respect of any member of the Wider Berkeley
Morgan Group which in any such case is material and adverse in the context of
the Wider Berkeley Morgan Group taken as a whole;



i)         save as revealed, Personal Group not having discovered:



                               (i)      that any financial or business or other
information publicly announced at any time by or on behalf of any member of the
Wider Berkeley Morgan Group is misleading or contains a misrepresentation of any
fact or omits to state a fact necessary to make the information contained
therein not misleading (and which is not subsequently corrected before the date
of publication of the Offer Document by disclosure either publicly or otherwise
fairly in writing to Personal Group) in each case to an extent that the effect
of the inaccuracy or misrepresentation of fact or omission is to overstate the
assets or understate the liabilities of the Berkeley Morgan Group to an extent
which is material in the context of the Wider Berkeley Morgan Group taken as a
whole;



                             (ii)      that any member of the Wider Berkeley
Morgan Group and any partnership, company or other entity in which any member of
the Wider Berkeley Morgan Group has a significant interest is subject to any
liability (contingent or otherwise) which has not been publicly announced and
which is material in the context of the Wider Berkeley Morgan Group taken as a
whole; and



any information which affects the import of any information which has been
revealed to an extent which is material and adverse in the context of the Wider
Berkeley Morgan Group taken as a whole.



Personal Group reserves the right to waive, in whole or in part, all or any of
the above conditions apart from conditions (a) and (b). If Personal Group is
required by the Panel to make an offer for Berkeley Morgan Shares under the
provisions of Rule 9 of the Code, Personal Group may make such alterations to
the above conditions, including condition (a), as are necessary to comply with
the provisions of that Rule.



The Offer will lapse unless the conditions set out above (other than condition
(a)) are fulfilled or (if capable of waiver) waived by Personal Group no later
than 21 days after whichever is the later of the First Closing Date or the date
on which the Offer becomes or is declared unconditional as to acceptances, or
such later date as the Panel may agree. Personal Group shall be under no
obligation to waive or treat as satisfied any of the conditions (c) to (i) by a
date earlier than the latest date specified above for the satisfaction thereof
notwithstanding that the other conditions of the Offer may at such earlier date
have been waived or fulfilled and that on such earlier date there are no
circumstances indicating that any of such conditions may not be capable of
fulfilment.



The Offer will lapse if the Acquisition is referred to the Competition
Commission before 3.00 p.m. on whichever is the later of the First Closing Date
or the date on which the Offer becomes or is declared unconditional as to
acceptances. In such circumstances, the Offer will cease to be capable of
further acceptance and persons accepting the Offer and Personal Group shall
thereupon cease to be bound by acceptances delivered on or before the date on
which the Offer so lapses.





2. Certain further terms of the Offer

Personal Group will reserve the right to waive, in whole or in part, all or any
of the above conditions except condition (a). The Offer will lapse unless the
conditions set out above are fulfilled or satisfied or (if capable of waiver)
waived by Personal Group or, where appropriate, have been determined by Personal
Group in its reasonable opinion to be or to remain satisfied no later than
midnight on the twenty first day after the later of the First Closing Date and
the date on which the Offer becomes or is declared unconditional as to
acceptances, or such later date as Personal Group may, with the consent of the
Panel, decide.



Each of conditions (a) to (i) shall be regarded as a separate condition and
shall not be limited by reference to any other condition.



Personal Group shall be under no obligation to waive or treat as fulfilled any
of conditions (b) to (i) (inclusive) by a date earlier than the date specified
above for the fulfilment thereof notwithstanding that the other conditions of
the Offer may at such earlier date have been fulfilled and that there are at
such earlier date no circumstances indicating that any of such conditions may
not be capable of fulfilment.



The Offer will lapse if there is a reference to the Competition Commission
before the later of 3.00 p.m. on the First Closing Date and the time and date at
which the Offer becomes or is declared unconditional as to acceptances.



In circumstances where the Offer lapses, the Offer will cease to be capable of
further acceptances and persons accepting the Offer and Personal Group will
cease to be bound by acceptances delivered on or before the date on which the
Offer so lapses.



The Berkeley Morgan Shares which are the subject of the Offer will be acquired
under the Offer fully paid and free from all liens, equities, charges,
encumbrances, rights of pre-emption and any other third party rights or
interests of any nature whatsoever and together with all rights now or hereafter
attaching thereto, including the right to receive and retain in full all
dividends and other distributions declared, made or paid after the date of this
announcement but not including the interim dividend announced by Berkeley Morgan
on the date of this announcement.



If Personal Group is required by the Panel to make an offer for Berkeley Morgan
Shares under the provisions of Rule 9 of the Code, Personal Group may make such
alterations to the conditions, including to condition (a), as may be necessary
to comply with the provisions of that Rule.



For the purposes of these conditions: the 'Wider Berkeley Morgan Group' means
Berkeley Morgan and its subsidiaries, subsidiary undertakings, associated
undertakings and any other undertakings, in which Berkeley Morgan and/or such
undertakings (aggregating their interests) have a significant interest and the '
Wider Personal Group' means Personal Group and its subsidiaries, subsidiary
undertakings, associated undertakings and any other undertakings in which
Personal Group and/or such undertakings (aggregating their interests) have a
significant interest, and, for these purposes, 'subsidiary', 'subsidiary
undertaking', 'associated undertaking' and 'undertaking' have the meanings given
by the Act, other than paragraph 20(l)(b) of Schedule 4A to the Act which shall
be ignored for this purpose, and 'significant interest' means a direct or
indirect interest in 20 per cent. or more of the total voting rights conferred
by the equity capital of an undertaking.



The Offer will be on the terms and will be subject to the conditions which are
set out in part 1 above and those terms and conditions which will be set out in
the Offer Document and in the Form of Acceptance and such further terms as may
be required to comply with the AIM Rules and the applicable rules and
regulations of the Financial Services Authority, the London Stock Exchange and
the provisions of the Code. The Offer and any acceptances thereunder will be
governed by English law and will be subject to the jurisdiction of the courts of
England and Wales.



The Offer will comply with English law and the City Code.



The Offer will not be made, directly or indirectly, in or into or from the
United States, Canada, Australia, the Republic of Ireland or Japan.





Appendix 2

                                  Definitions



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

'Acquisition'   the proposed acquisition of Berkeley Morgan by Personal Group to
                be effected by way of the Offer

'Act'           the Companies Act 1985, as amended

'AIM'           the market of that name operated by the London Stock Exchange

'AIM Rules'     the AIM Rules for Companies published by the London Stock
                Exchange as in force at the date of this announcement or, where
                the context requires, as amended or modified after the date of
                this announcement

'Australia'     the Commonwealth of Australia, its states, territories and
                possessions and all areas subject to its jurisdiction and any
                political sub-division thereof

'BDO Stoy       BDO Stoy Hayward Corporate Finance, a division of BDO Stoy
Hayward         Hayward LLP, Chartered Accountants, which is authorised and
Corporate       regulated by the Financial Services Authority to carry on
Finance'        investment business, financial adviser to Berkeley Morgan

'Berkeley       Berkeley Morgan Group plc (registered in England and Wales with
Morgan' or the  registered number 3456258)
'Company'

'Berkeley       the directors of Berkeley Morgan
Morgan Board'
or
'Berkeley
Morgan
Directors'

'Berkeley       Berkeley Morgan and its subsidiary undertakings
Morgan Group'

'Berkeley       holders of share options under the Berkeley Morgan Share Option
Morgan Option   Scheme
Holders'

'Berkeley       holders of Berkeley Morgan Shares
Morgan
Shareholders'

'Berkeley       The Berkeley Morgan Unapproved Share Option Plan for independent
Morgan Share    contractors
Option
Scheme'

'Berkeley       the existing unconditionally allotted or issued fully paid
Morgan          ordinary shares of 10 pence each in the share capital of
Shares'         Berkeley Morgan and any further such shares which are
                unconditionally allotted or issued fully paid at or before the
                time at which the Offer ceases to be open for acceptance (or
                such earlier date and/or time, not being earlier than the date
                on which the Offer becomes or is declared unconditional as to
                acceptances or, if later, the First Closing Date of the Offer,
                as Personal Group may, subject to the City Code, decide)
                including any such shares unconditionally allotted or issued
                upon the exercise of options granted under the Berkeley Morgan
                Share Option Scheme

'business       a day (other than a Saturday or Sunday) on which banks are
day'            generally open for business in the City of London

'Canada'        Canada, its provinces, possessions and territories and all areas
                subject to its jurisdiction and any political sub-division
                thereof

'Capita IRG     Capital IRG Plc (registered in England and Wales with company
Plc'            number 2605568)

'City Code' or  the City Code on Takeovers and Mergers
'Code'

'Closing        the closing middle market quotation for a Berkeley Morgan Share
Price'          as published on the OFEX web-site at the close of the market on
                the relevant day

'dealing day'   a day on which dealings in domestic securities may take place
                on, and with the authority of, OFEX

'Durlacher'     Durlacher Limited, which is authorised and regulated by the
                Financial Services Authority to carry on investment business, is
                financial adviser to Personal Group

'Electra'       Electra Kingsway VCT plc

'Facility       the £12,000,000 acquisition finance and working capital
Agreement'      facilities agreement entered into on 9 December 2004 between (1)
                Personal Group and various of its subsidiaries and (2) the Royal
                Bank of Scotland plc

'First Closing  the date which is twenty one days after the posting of the Offer
Date'           Document

'Form of        the form of acceptance, authority and election for use in
Acceptance'     connection with the Offer accompanying the Offer Document
'Japan'         Japan, its cities, prefectures, territories and possessions and
                all other areas subject to its jurisdiction and any political
                sub-division thereof

'London Stock   London Stock Exchange plc
Exchange'

'OFEX'          the market of that name operated by OFEX plc and regulated by
                the Financial Services Authority

'Offer'         the recommended cash offer to be made by Durlacher on behalf of
                Personal Group to acquire all of the Berkeley Morgan Shares on
                the terms and subject to conditions to be set out in the Offer
                Document and in the Form of Acceptance and, where the context
                requires, any subsequent revision, variation, extension or
                renewal thereof

'Offer          the document to be dispatched to Berkeley Morgan Shareholders
Document'       (other than certain Overseas Shareholders) setting out the full
                terms and conditions of the Offer and, where appropriate, any
                other document(s) containing terms and conditions of the Offer
                constituting the full terms and conditions of the Offer

'Ordinary       ordinary shares of 10 pence each in the share capital of the
Shares'         Company

'Overseas       Berkeley Morgan Shareholders whose registered addresses are
Shareholders'   outside the UK or who are citizens, residents or nationals of
                countries other than the UK or who are nominees of, or trustees
                for, citizens, residents or nationals in countries other than
                the UK

'Panel'         The Panel on Takeovers and Mergers

'Personal       Personal Group Holdings plc (registered in England and Wales
Group'          with registration number 3194991)

'Personal Group the directors of Personal Group
Board' or
'Personal Group
Directors'

'Regulatory     Newstrack or any other news service required to be used by AIM,
Information     OFEX, the London Stock Exchange or the Financial Services
Service'        Authority

'significant    a direct or indirect interest in 20 per cent. or more of the
interest'       total voting rights conferred by the equity capital of an
                undertaking

'subsidiary' or have the meanings given to them by the Act
'subsidiary
undertaking'

'United         the United Kingdom of Great Britain and Northern Ireland
Kingdom' or
'UK'

'United States' the United States of America, its territories and possessions
or 'USA'        and all other areas subject to its jurisdiction or any political
                subdivision thereof, any state of the United States of America
                and the District of Columbia

'Wider Berkeley as defined in Part 2 of Appendix 1 to this announcement
Morgan Group'

'Wider Personal as defined in Part 2 of Appendix 1 to this announcement
Group'




All times referred to in this announcement are references to London time.


                      This information is provided by RNS
            The company news service from the London Stock Exchange