Issue of Capital Notes

Guinness Peat Group PLC
01 August 2006

                      Guinness Peat Group plc Announcement

               Proposed Issue of Capital Notes by GPG Finance plc

Further to the announcement made by Guinness Peat Group plc (GPG) on 24 July
2006 regarding the proposed issue of new capital notes (Offer) to New Zealand
investors by its subsidiary GPG Finance plc (GPG Finance), GPG confirms that the
Investment Statement and Prospectus relating to the Offer dated 31 July 2006
(Offer Document) has been registered at the New Zealand Companies Office.

The Offer Document will be posted on 8 August 2006 to all New Zealand resident
holders (as at 2 August 2006) of existing capital notes issued by GPG Finance in
2001 and will contain inter alia the following financial information relating to
GPG:-

"GPG's Investment portfolio consists of 94 investments and has been summarised
below incorporating market values as at 30 June 2006.

GPG INVESTMENT PORTFOLIO

                                                     Number of            Valuation at              Proportion invested
                                          Investments (Note 3)        30 June 2006 NZ$                        by region
                                                                              (Note 1)

New Zealand                                                  5             398 million                            15.4%

Australia                                                   39             987 million                            38.1%

UK / Europe                                                 40           1,118 million                            43.2%

USA                                                          4              56 million                             2.2%

Other                                                        6              28 million                             1.1%


Total investments (Note (2))                                94           2,587 million                           100.0%




NOTES


(1)   All valuations are converted to NZD at the closing mid-market foreign exchange rates on 30 June 2006, with
      the principal rates used being NZD/USD .6101, NZD/GBP .3299, and NZD/AUD .8212.

(2)   The valuation of GPG's investment portfolio is based on its shareholdings as at 30 June 2006. Quoted
      investments have been valued at the closing bid price of the shares on the relevant Stock Exchange on 30
      June 2006. No adjustment has been made to quoted prices to reflect the size of GPG's shareholding in
      particular companies. Unquoted investments have been valued at the Directors' valuation, except that (a)
      the investments in Coats Group and Staveley Inc (both of which are wholly owned) and Tafmo have been
      included at their consolidated book value on 31 December 2005, excluding loans advanced to the Parent
      Group, translated into NZ$ at the exchange rate on 30 June 2006; and (b) the investment in Nationwide
      Accident Repair Services plc (a joint venture) has been included at its equity accounted book value on 31
      December 2005, translated into NZ$ at the exchange rate on 30 June 2006.

      For this purpose, GPG's associates and joint ventures and also its operating subsidiaries (being Coats
      Group, Staveley Inc, Turners & Growers, Capral Aluminium, Tafmo and Canberra Investment Corporation) have
      been included as part of the investment portfolio.

(3)   This represents the number of companies in which GPG holds an investment, excluding companies that are in
      liquidation or have been delisted. Investments in different securities are treated as a single investment
      if they relate to the same investee company."


A circular will be posted to shareholders of GPG today convening an
extraordinary general meeting of GPG to be held at 10am on 31 August 2006 to
approve matters in connection with the Offer.

Goldman Sachs JBWere (NZ) Limited is the Lead Manager and Organising Participant
in relation to the Offer.

Contacts:

Tony Gibbs
Director
New Zealand                                                 Tel: + 64 9 379 8888

Richard Russell
Company Secretary
United Kingdom                                            Tel: + 44 207 484 3370

Andrew Barclay
Goldman Sachs JBWere
New Zealand                                                 Tel: + 64 9 357 3200


Dated: 1 August 2006

Under the terms of the Offer, no offer or invitation is made in any jurisdiction
other than New Zealand.  This  Offer is directed only at persons in New Zealand.
Any person not resident in New Zealand should not rely or act upon this Offer
or any of its contents.  Any person not resident in New Zealand who receives the
Offer Document should not rely or act upon the Offer made in that document.  GPG
Finance has reserved the right to reject any subscription received in respect of
the capital notes other than from within New Zealand or which GPG Finance or any
agent of GPG Finance believes may originate from outside New Zealand. The new
capital notes are unsecured debt securities issued by GPG Finance.




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