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05/03/2003

SIX CONTINENTS PLC - Announcement regarding Letter to Shareholders

Not for release, publication or distribution in whole or in part in or into Australia, Canada, Japan or the Netherlands

Today Six Continents PLC (“Six Continents”) is posting a letter to shareholders explaining why the Board firmly believes that Capital Management & Investments PLC’s (“CMI”) offer is not in shareholders’ interests and why separation is the best way forward for the company. The letter summarises the value leakage and risks inherent in CMI’s offer and explains again why the creation of two separately quoted and transparent businesses is the most effective way of delivering value and choice for Six Continents shareholders.

Tim Clarke, Chief Executive of Six Continents, said:

“The key principles that drive the Board’s approach are the creation of value and maximum choice for shareholders. We are happy, as we have always been, to consider any proposal that might achieve this. CMI’s proposal is opportunistic, risky and transfers huge value to CMI’s directors. We have no hesitation in categorically rejecting it and continuing to recommend to our shareholders that separating our hotels and pubs businesses is the right way forward.

We now have two new Boards, motivated management teams and real momentum. The uncertainty within those businesses which will result from a delay to the EGM also risks setting back the considerable progress that they have made since our plans were announced in October last year. We have already seen evidence that our franchisees dislike CMI’s proposals. Their resulting actions could materially damage shareholder value. Voting for the demerger on 12 March closes off no options for shareholders.”

Enquiries

Tim Clarke 020 7409 1919
Richard North  
   
Fiona Antcliffe 020 7404 5959
Sophie Fitton  

In connection with the forthcoming shareholder meetings, Six Continents shareholders are reminded that they should complete and return their forms of proxy as soon as possible, but in any event so as to be received by Lloyds TSB Registrars, The Causeway, Worthing, West Sussex BN99 8XF, no later than 10.30am on 10 March 2003. Forms of proxy for the Court Meeting may also be handed to the Chairman of the Court Meeting at that meeting.

If you have any questions about the proposals or are in any doubt as to how to complete the forms of proxy, please call the shareholder helpline on telephone number 0845 600 6063 (or +44 207 864 9190 from outside the UK) between 8.30am and 5.30pm (UK time) on Monday to Saturday. For legal reasons, this helpline will not be able to provide advice on the merits of the proposals or to provide financial advice.

This announcement contains certain forward-looking statements as defined under US law (Section 21E of the Securities Exchange Act of 1934). These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as “target”, “expect”, ”intend”, “believe” or other words of similar meaning.

By their nature, forward-looking statements are inherently predictive, speculative and involve risk and uncertainty. There are a number of factors that could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements.

Factors that could affect the business and the financial results are described in Item 3 Key Information – Risk Factors in the Six Continents Form 20-F for the financial year ended 30 September 2002 filed with the United States Securities and Exchange Commission.

Salomon Brothers International Limited, trading as Schroder Salomon Smith Barney, is acting as financial adviser to Six Continents and to nobody else in connection with the proposed separation and return of capital and any offer for Six Continents (the “Offer”) and as sponsor to InterContinental Hotels Group PLC and Mitchells & Butlers PLC and to nobody else in connection with the admission of the ordinary shares of InterContinental Hotels Group PLC and Mitchells & Butlers PLC to the official list of the UK Listing Authority (“Admissions”) and will not be responsible to anyone else for providing the protections afforded to clients of Schroder Salomon Smith Barney nor for providing advice in relation to the separation and return of capital, the Admissions or the Offer. Schroder is a trademark of Schroder Holdings plc and is used under licence by Salomon Brothers International Limited.

Merrill Lynch International is acting for Six Continents and for no-one else in connection with the Offer and will not be responsible to anyone other than Six Continents for providing the protections afforded to clients of Merrill Lynch International or for providing advice in relation to the Offer.

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