RNS Number:4037I
Six Continents PLC
06 March 2003



                               SIX CONTINENTS PLC

                               SEPARATION UPDATE



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





The Board of Six Continents PLC ("Six Continents") notes Capital Management and
Investment PLC's  ("CMI") announcement today. It continues its approach of using
invective rather than providing anything new of substance.



Proxies



The EGM and the Court Meeting to vote on the separation is on Wednesday 12th
March and shareholders are reminded that proxies must be received by no later
than 10.30am (GMT) on Monday 10th March. Forms of proxy for the Court Meeting
may be handed to the Chairman of the Court Meeting at that meeting.



Future Commitments



Since the demerger announcement on 1st October 2002, both InterContinental
Hotels Group ("IHG") and Mitchells & Butlers ("M and B") have continued to
develop clear and objective strategies for the companies following separation.
Each company has made a number of commitments to demonstrate its objective of
maximising value for shareholders.  These are as follows:


         IHG
         -    Annual cost savings of at least $100 million (including the elimination of
              approximately $15 million of incremental overhead cost inherited by IHG as a result
              of the separation) against the 2003 budgeted overheads
         -    A significant reduction in the company's #3.8 billion asset base driven by the asset
              by asset review process
         -    A reduction in future capital spend to drive returns
         -    Use of surplus cash to reduce debt and buy back shares
         -    No corporate acquisitions for the foreseeable future
         -    A progressive dividend policy




         M and B
         -    Drive sales growth through conversion of the unbranded estate and controlled
              promotional activity
         -    Disciplined capital allocation with selective disposals
         -    Reduction in capital expenditure and focus on high return investments
         -    Aggressive management of the cost base
         -    A progressive dividend policy
         -    Active review of financing options to optimise capital structure
         -    Return surplus cash from refinancing to shareholders





The Boards of both companies have given an explicit commitment that they will
seriously consider any proposal that might be attractive to shareholders and has
a reasonable prospect of delivery.



Separation Timetable



Wednesday 12th March

Court Meeting (10.30am) - to approve the Scheme of Arrangement necessary to
insert a new holding company, M and B

Extraordinary General Meeting (to immediately follow the Court Meeting) - to
approve the separation of the two businesses



Thursday 10th April

Court Hearing - to sanction the Scheme of Arrangement



Monday 14th April

Court Hearing - to confirm the reduction of capital of M and B which effects the
separation.



Tuesday 15th April

Trading in M and B and IHG shares commence



Approval by shareholders at the Court Meeting and EGM next week will allow the
separation (subject to the sanction of the Court) to become effective on 15th
April.  Notwithstanding this, the directors of Six Continents can withdraw the
demerger at any time up until 14th April. In this light, the Board reiterates
that it will give serious consideration to any proposal that might be attractive
to shareholders and has a reasonable prospect of delivery.



CMI's  incorrect statements



CMI has made a number of statements that Six Continents management has been "
unreceptive to approaches." This is not correct and the facts are as follows:


          *      Six Continents announced on 1st October 2002 that it intended to demerge its hotels and
                 pubs businesses.  Since that date, with the exception of CMI and other Hugh Osmond
                 vehicles, Six Continents has received no proposals to acquire either its pub or hotel
                 business.  Similarly, no proposal has been received for Six Continents as a whole.
          *      Sun Capital, a Hugh Osmond vehicle, first made an approach to Six Continents in late
                 October 2002. Six Continents evaluated the proposal carefully. The Board of Six
                 Continents was advised that the proposal of a sale and leaseback would have transferred
                 material value from Six Continents to Sun Capital.  Since November 2002 Hugh Osmond has
                 made no further approaches to Six Continents.





CMI has had months to formulate an attractive proposal. Why does it need even
more time?



Tim Clarke, Chief Executive of Six Continents said:



"We urge shareholders to vote in favour of the demerger which the Board
unanimously believes will deliver maximum value and choice.



CMI has had since 1st October 2002, when we announced the plans for our
demerger, to prepare an offer for Six Continents that would be attractive to our
shareholders.  In full knowledge of our timetable, and for reasons known only to
itself, CMI has chosen to make an offer in the closing stages and to impose a
false deadline on our shareholders.



Voting for demerger on 12th March increases our shareholders' choice in contrast
to CMI's attempt to railroad our shareholders into delaying the EGM."



Enquiries:


Tim Clarke            020 7404 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.

This announcement for which the directors of Six Continents are responsible, has
been issued by Six Continents and has been approved solely for the purposes of
section 21 of the Financial Services and Market Act 2000 by Salomon Brothers
International Limited, trading as Schroder Salomon Smith Barney, of Citigroup
Centre, Canada Square, Canary Wharf, London E14 5LB. 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 or 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.




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