Letter to ADS holders (November 2006)

30 November 2006

Dear ADS holder,

Please find enclosed your 2006 interim dividend details.

You will have received a hard copy of the 2006 interim report a few weeks ago – and I am writing to you now to let you know that, in the future, Gallaher will no longer be automatically providing every ADS holder with a hard copy of the Group’s financial publications (historically: interim report, annual review and summary financial statement (“SFS”) and annual general meeting (“AGM”) report).

On 21 August 2006, the New York Stock Exchange (“NYSE”) eliminated the requirement that listed companies physically deliver financial publications (SFSs, annual reports, etc.) to shareholders, in light of the increase in use of the internet. Instead a listed company now must make its financial publications, including its annual report, available to shareholders on or through its website and issue a news release which announces the filing of the annual report with the SEC (and which includes the company’s website address where the filing can be obtained). In addition, a company must provide security holders with the ability to receive, upon request, a hard copy of the complete financial statements included in its SEC filing free of charge.

Bearing in mind that an increasing number of people already prefer on-line access to financial publications, and as ceasing the automatic printing and mailing of hard copies will be cost-effective, Gallaher has decided to adopt the new practice as detailed by the NYSE.

While reviewing our financial publications’ timetable, we have also taken the decision to cease publication of the AGM report (which was sent to investors some time after the AGM). The wording in this report duplicated the chairman’s AGM statement which is issued as a news release on the day of the AGM each year. The news release is available on the Company’s website immediately after it is issued (see below regarding the ‘e-mail alert’ service to assist notification).

We are, however, aware that there will be some ADS holders who would still like to receive a hard copy of the SFS automatically, and, therefore, we intend to maintain a mailing list for those who wish to continue receiving our publications as a matter of course (rather than having to contact us each time we issue a news release announcing the filing of a publication with the SEC).

In order for you to continue to receive hard copies automatically, please inform us before 31 December 2006, and provide your full name and address which we will add to this mailing list, using one of the following methods:

• -by sending a letter to the following address:
  
  Investor Relations Department
  Gallaher Group Plc
  Members Hill, Brooklands Road
  Weybridge
  Surrey KT13 0QU
  United Kingdom

• -by sending a fax to the following number:
  
  +44 (0) 1932 372792

• -by sending an e-mail to the following address:
  
  jacky.stockman@gallahergroup.com

Please note: this mailing list will be used for no other purposes than recording your details in order that we can send you financial publications. You may request that your details be removed at any time.

And, in case you were not aware, we also provide an e-mail alert service to notify investors of news, including the release of financial publications (and the chairman’s AGM statement news release), which can then be accessed electronically on the Group website. If you would like to subscribe to this service, please see the right hand side of the investor relations homepage (use the link below) – and follow the instructions:

• -http://www.gallaher-group.com/ir

By subscribing to this service, you will receive an e-mail from us as soon as Gallaher’s financial publications, and other pertinent news, appears on the website. The e-mail is always timed to be sent just after release, so it is the quickest way to receive news from Gallaher.

For your information, all Gallaher’s financial publications, dating back to the Company’s listing in 1997, can be found in the investor relations section of the Group website (use the link below):

• -http://ir.gallaher-group.com/ir/publications/index.asp

We provide two versions of each publication: a pdf of the full report and a fully accessible html version.

I hope you have found the contents of this letter useful and interesting. If you have any queries relating to any of the above or something not mentioned, you can always contact Jacky Stockman in the investor relations department at Gallaher for assistance (telephone: +44 (0) 1932 372000, the e-mail address above, or via the investor relations website).

Finally, I should like to thank you for your continued support of Gallaher Group Plc.

Yours faithfully,

Claire Jenkins
Director, investor relations

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