Burberry Ipo

Burberry’s IPO

Reasons for an IPO

Why the IPO:

* A partial IPO will establish a market value for Burberry for GUS shareholders

* It is a further step in focusing GUS on fewer activities

* It will give Burberry its own currency for growth

* It will build on the strong business and financial momentum within Burberry that has seen operating profits grow from £10.7m in 1999 to

John Peace, Chief Executive of GUS plc, commented:

"The plan to float part of Burberry is an important step in the strategic focusing of GUS. Through the retention of a majority stake in the business, GUS shareholders will benefit from Burberry's future growth potential while giving new investors the opportunity to participate directly in this exciting company."

Rose Marie Bravo, Chief Executive of Burberry, commented:

"Burberry is a distinctive luxury brand with a unique heritage and global recognition. The strategy we have implemented over the past few years has transformed the business. We have established a strong platform for future growth through expanding our product ranges, strengthening control of our distribution channels and expanding our geographic reach. The planned IPO gives us the opportunity to share our vision for Burberry with a wider community."

Burberry intends to list on the London Stock Exchange. The listing is expected to be effected by way of an institutional offer in the UK and internationally. Joint sponsors and joint lead managers to the Offer are Merrill Lynch and Morgan Stanley. Cazenove and UBS Warburg are acting as co-lead managers.

In their IPO prospectus, published in spring

2002, Burberry identified the key strategic

challenges that faced their business in 1997 as

follows:

. a heavy reliance upon a small base of core

products;

. a company-owned retail network based within

non-strategic locations;

. an inconsistent wholesale distribution strategy

with Burberry products being sold in a widerange

of retail environments of...