Merger

Elderstreet VCT PLC
29 November 2006

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

29 November 2006

                                     Merger

                         by way of recommended offer by

                      Elderstreet VCT plc ('Elderstreet')

                                      for

        Elderstreet Millennium Venture Capital Trust plc ('Millennium')




Summary

The boards of Elderstreet and Millennium announce that Millennium and
Elderstreet have reached agreement on the terms of a merger by way of a
recommended offer to be made by Elderstreet for the entire issued ordinary share
capital of Millennium.

•The Offer will be all-share and, in addition, a special dividend will be paid
 (tax-free to Qualifying Shareholders), subject to the Offer becoming or being
 declared wholly unconditional. The Offer is being made on the basis of 381 New
 Elderstreet Shares for every 1,000 Millennium Shares. The Special Dividend will
 be payable in cash on the basis of 22.5p per Millennium Share.

•The table below sets out the approximate value of the Offer (per share and for
 the whole of the current issued ordinary share capital of Millennium), when
 combined with the Special Dividend and based on the closing price of 55.0p per
 Elderstreet Share on 28 November 2006:

                Offer price         Special     Offer value per     Total Offer
             per Millennium    Dividend per          Millennium    value (incl.
                      Share      Millennium        Share (incl.         Special
                                      Share             Special       Dividend)
                                                      Dividend)

Offer value          21.0p           22.5p               43.5p           £7.0m

•The Merger will create an enlarged VCT with enhanced diversification and
 achieve estimated cost savings of approximately £200,000 per annum. Total 
 annual running costs are expected to be less than 3.2 per cent. of the 
 Enlarged Group's Net Assets.

•Millennium Shareholders who receive New Elderstreet Shares under the Offer
 should not lose any entitlements to VCT tax relief as a result of the Merger.

•If the Merger does not proceed, shareholders in Millennium could potentially
 remain invested in a small VCT with higher overheads (and no fee cap) and
 limited prospects for growth.

•If Millennium becomes a subsidiary of Elderstreet and its stock exchange
 listing is cancelled, it will lose its VCT status and certain shareholders who
 do not accept the Offer may lose the tax reliefs obtained and thereby incur
 substantial tax liabilities.

•The Millennium Directors, who have been so advised by PKF (UK) LLP, consider
 the terms of the Offer, when combined with the Special Dividend, to be fair 
 and reasonable and intend to recommend that Millennium Shareholders accept the
 Offer.

This summary should be read in conjunction with the full text of this
announcement.

Enquiries:

Elderstreet Investment Management Limited (investment manager of Elderstreet and
Millennium)
Tel: [phone]
Barnaby Terry
William Horlick

Smith & Williamson (financial adviser to Elderstreet)
Tel: [phone]
Dr A Basirov
David Jones

PKF (UK) LLP (financial adviser to Millennium)
Tel: [phone]
Stephen Bayfield

This announcement does not constitute an offer or an invitation to purchase or
subscribe for any securities. The Offer will be made solely by the Offer
Document and the Form of Acceptance, which will contain the full terms and
conditions of the Offer, including details of how the Offer may be accepted.

Smith & Williamson Corporate Finance Limited, which is authorised and regulated
in the United Kingdom by the Financial Services Authority, is acting exclusively
for Elderstreet VCT plc and no one else in connection with the Offer and will
not be responsible to anyone other than Elderstreet VCT plc for providing the
protections afforded to customers of Smith & Williamson Corporate Finance
Limited nor for providing advice in relation to the Offer or any other matter
referred to herein.

PKF (UK) LLP, which is regulated by the Institute of Chartered Accountants in
England and Wales, is acting exclusively for Elderstreet Millennium Venture
Capital Trust plc and no one else in connection with the Offer and will not be
responsible to anyone other than Elderstreet Millennium Venture Capital Trust
plc for providing the protections afforded to customers of PKF (UK) LLP nor for
providing advice in relation to the Offer or any other matter referred to
herein.

The Offer will not be made, directly or indirectly, in or into the United
States, Canada, Australia or Japan and the Offer Document and the Form of
Acceptance will not be, and should not be, mailed or otherwise distributed or
sent in or into the United States, Canada, Australia or Japan or any other
jurisdiction if, in the latter case, to do so would constitute a violation of
the relevant laws in such jurisdiction.

The New Elderstreet Shares have not been, and will not be, registered under the
United States Securities Act of 1933 (as amended) or under any relevant
securities laws of any state or jurisdiction of the United States, Canada,
Australia or Japan and no regulatory clearances in respect of the New
Elderstreet Shares have been, or will be, applied for in any jurisdiction.
Accordingly, unless an exemption under the United States Securities Act of 1933
(as amended) or other relevant securities laws is applicable, the New
Elderstreet Shares will not be, and may not be, offered, sold, resold, delivered
or distributed, directly or indirectly, in or into the United States, Canada,
Australia or Japan or to, or for the account or benefit of, any United States
person or person resident in Canada, Australia or Japan.

Certain terms used in this summary are defined in Appendix III to this
announcement.

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

29 November 2006


                                    Merger

                         by way of recommended offer by

                      Elderstreet VCT plc ('Elderstreet')

                                      for

        Elderstreet Millennium Venture Capital Trust plc ('Millennium')



1. Introduction

The boards of Elderstreet and Millennium announce that Millennium and
Elderstreet have reached agreement on the terms of a merger by way of a
recommended offer to be made by Elderstreet for the entire issued ordinary share
capital of Millennium.

2. The Offer and the Special Dividend

The Offer, which will be made on the terms and subject to the conditions set out
below and in Appendix I to this announcement, and to be set out in the Offer
Document and in the Form of Acceptance, will be made on the following basis:

     for every 1,000 Millennium Shares           381 New Elderstreet Shares

In addition, a special dividend will be paid, subject to the Offer becoming or
being declared wholly unconditional, on the following basis:

per each Millennium Share   22.5p in cash (tax free to Qualifying Shareholders)

The Special Dividend will be paid by Millennium to all Millennium Shareholders
on the register of members at the close of business on the day on which the
Offer becomes or is declared wholly unconditional. In the absence of the Offer
being made and becoming unconditional in all respects, the Millennium Directors
would not have felt able to recommend or pay the Special Dividend due to the
adverse impact on the cash resources of Millennium as a stand-alone entity.

The table below sets out the approximate value of the Offer (per share and for
the whole of the current issued ordinary share capital of Millennium), when
combined with the Special Dividend and based on the closing price of 55.0p per
Elderstreet Share on 28 November 2006:

                Offer price         Special     Offer value per     Total Offer
             per Millennium    Dividend per          Millennium    value (incl.
                      Share      Millennium        Share (incl.         Special
                                      Share             Special       Dividend)
                                                      Dividend)
                   
Offer value          21.0p           22.5p               43.5p           £7.0m

The Offer will extend to all Millennium Shares unconditionally allotted or
issued on the date the Offer is made and any further Millennium Shares
unconditionally allotted or issued while the Offer remains open for acceptance.
Assuming Elderstreet acquires all the Millennium Shares under the Offer,
existing Millennium Shareholders would receive up to 6,149,829 New Elderstreet
Shares representing approximately 26.8 per cent. of the increased share capital
of the Enlarged Group.

The Millennium Shares to be acquired by Elderstreet pursuant to the Offer will
be acquired fully paid and free from all liens, equities, charges, encumbrances,
rights of pre-emption and other third party rights and interests of any nature
whatsoever and together with all rights now or hereafter attaching thereto,
including the right to receive and retain all dividends and other distributions
(if any) declared, paid or made on or after the date of this announcement other
than the Special Dividend.

3. Irrevocable undertakings to accept the Offer and interests in Millennium
   Shares

Elderstreet has received irrevocable undertakings from the Millennium Directors
to accept, or procure the acceptance of, the Offer in respect of their interests
in Millennium Shares, amounting in total to 278,000 Millennium Shares
(representing approximately 1.7 per cent. of the currently issued share capital
of Millennium). The undertakings remain binding even in the event that a higher
offer for Millennium is announced and will cease to be binding only if the Offer
lapses or is withdrawn.

The Millennium Directors who have given irrevocable undertakings to accept, or
procure the acceptance, of the Offer in respect of their interests in Millennium
Shares, are: Michael Stoddart (in respect of 140,000 Millennium Shares); Hugh
Aldous (in respect of 10,000 Millennium Shares); Philip Ling (in respect of
100,000 Millennium Shares); Christopher Kay (in respect of 18,000 Millennium
Shares); and John Young (in respect of 10,000 Millennium Shares). Nominee
companies owned by Smith & Williamson Holdings Limited hold 89,000 Millennium
Shares on behalf of discretionary fund management clients.

4. Background to and reasons for the Merger

Since the time of their initial offers for subscription (1998 for Elderstreet
and 1996 for Millennium), Elderstreet and Millennium have operated as separate
legal entities each with obligations under the Listing Rules and the Act. These
obligations entail, inter alia, separate board and shareholder meetings, audits
and regulatory reporting requirements. The combined net assets of Elderstreet
and Millennium are approximately £20.9 million (at 31 August 2006) and the
boards of the two companies consider the cost and time involved in the
administration of the separately-listed entities to be out of proportion to
their size.

Until a relatively recent change in UK tax legislation, a merger of Elderstreet
and Millennium would have resulted in the loss of the tax advantaged status of
their shares for Qualifying Investors. The VCT Merger Regulations, which became
effective in September 2004, now allow for the merger of VCTs without the loss
of their VCT status and as a result Millennium Shareholders who receive New
Elderstreet Shares under the Offer should not lose any entitlements to VCT tax
relief as a result of the Merger.

Currently, Elderstreet and Millennium have the same investment manager and
administrator and similar investment strategies. They also share a number of
common quoted and unquoted equity investments. The merger of the two entities,
which is expected to involve the transfer of substantially all of the assets of
Millennium to Elderstreet, should enable cost savings and enhance administrative
efficiency and, due to their common features, should be achievable without
incurring major costs arising from rearranging investment and administrative
arrangements. The total recurring annualised savings in respect of corporate and
administrative costs expected to arise from the Merger are estimated to be
approximately £200,000. Moreover, the total annual running costs are expected to
be less than 3.2 per cent. of the Enlarged Group's Net Assets); currently, such
costs (which, in Millennium's case, are uncapped) are estimated to amount to
approximately 3.9 per cent. of Millennium's Net Assets.

In addition to the cost savings and enhancement of operational efficiency which
are expected to arise from the Merger, there are a number of further anticipated
benefits, including the broadened range and diversity of the investment
portfolio of the Enlarged Group.

A special cash dividend of 22.5p per Millennium Share will be paid to Millennium
Shareholders (this dividend will be tax free to Qualifying Shareholders),
subject to the Offer becoming or being declared wholly unconditional. In the
absence of the Offer being made and becoming unconditional in all respects,
Millennium Directors would not have felt able to recommend or pay the Special
Dividend due to the adverse impact on the cash resources of Millennium as a
stand-alone entity.

The level of the Offer has been determined by reference to an adjusted net asset
value based on the net asset values of Elderstreet and Millennium as at 31
August 2006. Millennium Shareholders will receive New Elderstreet Shares with a
net asset value equal to the net asset value of their current holding of
Millennium Shares less: the Special Dividend; the estimated total expenses of
the Merger of £295,000; and a discount of 7.5 per cent.

In view of the size of Millennium in relation to Elderstreet and the number of
New Elderstreet Shares to be issued in connection with the Merger, the Offer
will be subject to the approval of Elderstreet Shareholders and C Shareholders
which will be sought at an extraordinary general meeting to be convened to
consider the appropriate resolutions further details of which will be set out in
the Prospectus to be sent to Elderstreet Shareholders.

5. Considerations for Millennium Shareholders

The Millennium Board is unanimously recommending that Millennium Shareholders
accept the Offer. In forming its view on the merits of the Offer, the Millennium
Board has considered, inter alia, the following factors:

•The Enlarged Group is expected to achieve estimated cost savings of
 approximately £200,000 per annum. The total annual running costs are expected 
 to be less than 3.2 per cent. of the Enlarged Group's Net Assets; currently, 
 such costs (which, in Millennium's case, are not subject to a cap) are 
 estimated to amount to approximately 3.9 per cent. of Millennium's Net Assets.

•Millennium Shareholders will receive the Special Dividend within 14 days of
 the Offer becoming or being declared wholly unconditional (this dividend will 
 be exempt from income tax to Qualifying Shareholders and will be available to 
 be paid primarily due to the increased size and liquidity of the Enlarged 
 Group).

•The Merger should create a more efficient VCT with enhanced diversification of
 investments.

•As the payment of dividends is essentially dependent on the realisation of
 investments, the greater number of investments held by the Enlarged Group and
 the enlarged portfolio's wider spread over the investment cycle should increase
 the potential for a smoother flow of dividends.

•Millennium's experienced investment management team will continue in place
 following the Merger with an unchanged investment policy.

•Millennium Shareholders who receive New Elderstreet Shares under the Offer
 should not lose any entitlements to VCT tax relief as a result of the Merger.

•If the Merger does not proceed, shareholders in Millennium could potentially
 remain invested in a small VCT with higher overheads (and, unlike Elderstreet,
 with no fee cap) and more limited prospects for growth.

•If Millennium becomes a subsidiary of Elderstreet and its stock exchange
 listing is cancelled, it will lose its VCT status and certain shareholders who
 do not accept the Offer may lose the tax reliefs obtained and thereby incur
 substantial tax liabilities.

6. Recommendation

The Millennium Directors, who have been so advised by PKF (UK) LLP, consider the
terms of the Offer, when combined with the Special Dividend, to be fair and
reasonable. Accordingly, the Millennium Directors unanimously recommend
Millennium Shareholders to accept the Offer as they intend to do in respect of
their own holdings of Millennium Shares which represent in aggregate 1.4 per
cent. of Millennium's issued share capital.

7. Information on Elderstreet

Shares in Elderstreet, formerly named Elderstreet Downing VCT plc, were
initially offered to the public in January 1998. Elderstreet raised £15.1
million (after expenses) and its shares were admitted to trading on the Official
List in May 1998. Since then Elderstreet has carried on the business of an
investment company in accordance with VCT legislation.

As at 31 August 2006, Elderstreet held investments in 24 companies with a total
value of £8.8 million and £3.2 million in fixed interest securities, cash and
bank deposits. Elderstreet's unaudited net asset value as at 31 August 2006 was
£12.1 million (70.4p per Elderstreet Share; 92.5p per C Share). Further
information on Elderstreet will be set out in the Offer Document and Prospectus.

8. Information on Millennium

Shares in Millennium, formerly named Gartmore Venture Capital Trust plc, were
initially offered to the public in February 1996. Millennium raised £18.7
million (after expenses) and its shares were admitted to trading on the Official
List in April 1996. Since then Millennium has carried on the business of an
investment company in accordance with VCT legislation.

As at 31 August 2006, Millennium held investments in 18 companies with a total
value of £5.2 million and £3.5 million in fixed interest securities, cash and
bank deposits. Millennium's unaudited net asset value as at 31 August 2006 was £
8.8 million (54.4p per Millennium Share). Further information on Millennium will
be set out in the Offer Document and Prospectus.

9. Management and employees

There are no employees of Millennium. It has been agreed that, if the Merger
becomes effective, Hugh Aldous (currently a director of Millennium) will be
appointed to the Elderstreet Board and that the other Millennium Directors will
resign from the Millennium Board. Further details on the Elderstreet Board will
be set out in the Prospectus.

10. Inducement fee

Millennium has agreed to pay a fee to Elderstreet of the lesser of £70,000 and
an amount representing 1 per cent. of the value of the Offer plus the Special
Dividend in the event that:

(a) a competing offer for Millennium is announced before the Offer lapses or is
withdrawn and such competing offer subsequently becomes or is declared
unconditional in all respects or is otherwise completed or implemented; or

(b) the Millennium Board withdraws or adversely modifies its recommendation of
the Offer.

Further information on the inducement fee will be set out in the Prospectus. No
inducement fee will be payable to Elderstreet if the Offer becomes or is
declared unconditional in all respects.

11. De-listing and compulsory acquisition

If the Offer becomes or is declared wholly unconditional, and subject to
applicable requirements of the London Stock Exchange, Elderstreet intends to
procure the making of an application by Millennium to the UKLA for the
cancellation of the listing of the Millennium Shares on the Official List and to
the London Stock Exchange for the cancellation of trading in Millennium Shares
on its market for listed securities. It is anticipated that such cancellation
will take effect no earlier than 20 business days after the date on which the
Offer becomes or is declared wholly unconditional. The cancellation of listing
and trading would be expected to reduce significantly the liquidity and
marketability of any Millennium Shares in respect of which valid acceptances of
the Offer are not received. In addition, the cancellation of listing would lead
to the loss of Millennium's tax status as a VCT and the loss of VCT tax reliefs
obtained by any remaining Millennium Shareholders who had not accepted the
Offer.

If sufficient acceptances under the Offer are received, and assuming all the
other conditions of the Offer have been satisfied or waived, and the Offer
becomes or is declared wholly unconditional Elderstreet intends to exercise its
rights pursuant to the provisions of Schedule 2 to the Takeovers Directive
(Interim Implementation) Regulations 2006 to acquire compulsorily the remaining
Millennium Shares on the same terms as the Offer.

It is further intended that, following the Offer becoming or being declared
wholly unconditional and following the cancellation of listing and trading
referred to above, Millennium will be re-registered as a private company under
the relevant provisions of the Act.

12. Rule 8 of the City Code on Takeovers and Mergers

Under the provisions of rule 8.3 of the City Code on Takeovers and Mergers (the
'Code'), if any person is, or becomes, ''interested'' (directly or indirectly)
in one per cent. or more of any class of ''relevant securities'' of Elderstreet
or of Millennium, all ''dealings'' in any ''relevant securities'' of that
company (including by means of an option in respect of, or a derivative
referenced to, any such ''relevant securities'') must be publicly disclosed by
no later than 3.30 p.m. (London time) on the London business day following the
date of the relevant transaction. This requirement will continue until the date
on which the Offer becomes, or is declared, unconditional as to acceptances,
lapses or is otherwise withdrawn or on which the ''offer period'' otherwise
ends. If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire an ''interest'' in
''relevant securities'' of Elderstreet or of Millennium, they will be deemed to
be a single person for the purpose of rule 8.3.

Under the provisions of rule 8.1 of the Code, all ''dealings'' in ''relevant
Securities'' of the Company or of Millennium by Elderstreet or Millennium, or by
any of their respective ''associates'', must be disclosed by no later than 12.00
noon (London time) on the London business day following the date of the relevant
transaction.

A disclosure table giving details of the companies in whose ''relevant
securities'' ''dealings'' should be disclosed and the number of such securities
in issue can be found on the Panel's website at www.thetakeoverpanel.org.uk.

''Interests in securities'' arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an ''interest'' by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.

Terms in quotation marks are defined in the Code, which can also be found on the
Panel's website. If you are in any doubt as to whether or not you are required
to disclose a ''dealing'' under rule 8, you should consult the Panel.

13. General

The conditions of the Offer are set out in Appendix I to this announcement.
Sources of information and bases of calculation used in the announcement are
given in Appendix II to this announcement. The definitions of certain terms used
in this announcement are contained in Appendix III to this announcement.

Smith & Williamson, on behalf of Elderstreet, will despatch the Offer Document,
setting out full details of the Offer as soon as practicable and in any event
within 28 days of the date of this announcement.

This announcement does not constitute an offer or an invitation to purchase or
subscribe for any securities.

The Offer will be made solely by the Offer Document and the Form of Acceptance,
which will contain the full terms and conditions of the Offer, including details
of how the Offer may be accepted.

The laws of the relevant jurisdictions may affect the availability of the Offer
to persons not resident in the UK. Persons who are not resident in the UK, or
who are subject to the laws of any jurisdiction other than the UK, should inform
themselves about, and observe, any applicable requirements. Further details in
relation to overseas shareholders will be contained in the Offer Document.

The Offer will not be made, directly or indirectly, in or into the United
States, Canada, Australia or Japan and the Offer Document and the Form of
Acceptance will not be, and should not be, mailed or otherwise distributed or
sent in or into the United States, Canada, Australia or Japan or any other
jurisdiction if, in the latter case, to do so would constitute a violation of
the relevant laws in such jurisdiction.

The New Elderstreet Shares have not been, and will not be, registered under the
United States Securities Act of 1933 (as amended) or under any relevant
securities laws of any state or jurisdiction of the United States, Canada,
Australia or Japan and no regulatory clearances in respect of the New
Elderstreet Shares have been, or will be, applied for in any jurisdiction.
Accordingly, unless an exemption under the United States Securities Act of 1933
(as amended) or other relevant securities laws is applicable, the New
Elderstreet Shares will not be, and may not be, offered, sold, resold, delivered
or distributed, directly or indirectly, in or into the United States, Canada,
Australia or Japan or to, or for the account or benefit of, any United States
person or person resident in Canada, Australia or Japan.

The Elderstreet Directors accept responsibility for the information contained in
this announcement other than that relating to the Millennium Group and the
Millennium Directors and their connected persons and persons acting in concert
with, and associates of, Millennium. To the best of the knowledge and belief of
the Elderstreet Directors (who have taken all reasonable care to ensure that
such is the case), the information contained in this announcement for which they
are responsible is in accordance with the facts and does not omit anything
likely to affect the import of such information.

The Millennium Directors accept responsibility for the information contained in
this announcement relating to the Millennium Group and the Millennium Directors
and their connected persons and persons acting in concert with, and associates
of, Millennium. To the best of the knowledge and belief of the Millennium
Directors (who have taken all reasonable care to ensure that such is the case),
the information contained in this announcement for which they are responsible is
in accordance with the facts and does not omit anything likely to affect the
import of such information.


Enquiries:

Elderstreet Investment Management Limited (investment manager of Elderstreet and
Millennium)

Tel: [phone]
Barnaby Terry
William Horlick

Smith & Williamson (financial adviser to Elderstreet)
Tel: [phone]
Dr A Basirov
David Jones

PKF (UK) LLP (financial adviser to Millennium)
Tel: [phone]
Stephen Bayfield

This announcement does not constitute an offer or an invitation to purchase or
subscribe for any securities. The Offer will be made solely by the Offer
Document and the Form of Acceptance, which will contain the full terms and
conditions of the Offer, including details of how the Offer may be accepted.

Smith & Williamson Corporate Finance Limited, which is authorised and regulated
in the United Kingdom by the Financial Services Authority, is acting exclusively
for Elderstreet VCT plc and no one else in connection with the Offer and will
not be responsible to anyone other than Elderstreet VCT plc for providing the
protections afforded to customers of Smith & Williamson Corporate Finance
Limited nor for providing advice in relation to the Offer or any other matter
referred to herein.

PKF (UK) LLP, which is regulated by the Institute of Chartered Accountants in
England and Wales, is acting exclusively for Millennium and no one else in
connection with the Offer and will not be responsible to anyone other than
Millennium for providing the protections afforded to customers of PKF (UK) LLP
nor for providing advice in relation to the Offer or any other matter referred
to herein.


APPENDIX I

CONDITIONS OF THE OFFER

The Offer will be subject to the following conditions:

(a) valid acceptances being received (and not, where permitted, withdrawn) by
not later than 1.00 p.m. (London time) on the first closing date of the Offer
(or such later time(s) and/or date(s) as Elderstreet may, subject to the rules
of the Code, decide) in respect of not less than 90 per cent. (or such lower
percentage as Elderstreet may decide) in nominal value of the Millennium Shares
to which the Offer relates and not less than 90 per cent. (or such lower
percentage as Elderstreet may decide) of the voting rights carried by the
Millennium Shares to which the Offer relates, provided that this condition will
not be satisfied unless Elderstreet and/or its wholly owned subsidiaries shall
have acquired or agreed to acquire (whether pursuant to the Offer or otherwise)
Millennium Shares carrying in aggregate more than 50 per cent. of the voting
rights then normally exercisable at a general meeting of Millennium, including
for this purpose (except to the extent otherwise agreed by the Panel) any such
voting rights attaching to any Millennium Shares that are unconditionally
allotted or issued before the Offer becomes or is declared unconditional as to
acceptances, whether pursuant to the exercise of any outstanding subscription or
conversion rights or otherwise; and for this purpose:

(i) the expression 'Millennium Shares to which the Offer relates' shall be
construed in accordance with Schedule 2 to the Takeovers Directive (Interim
Implementation) Regulations 2006 (SI 1183/2006); and

(ii) Millennium Shares which have been unconditionally allotted shall be deemed
to carry the voting rights which they will carry upon issue;

(b) any resolution or resolutions of Elderstreet Shareholders required to
approve and implement the Offer and the acquisition of Millennium Shares by
Elderstreet pursuant to the Offer being duly passed at an extraordinary general
meeting to be convened by Elderstreet (or at any adjournment of that meeting);

(c) the UKLA having announced its agreement to admit the New Elderstreet Shares
to be issued as consideration for the acquisition of the Millennium Shares
pursuant to the Offer to the Official List and the London Stock Exchange having
announced its agreement to admit the New Elderstreet Shares to trading on its
market for listed securities;

(d) no Third Party having intervened and there not continuing to be outstanding
any statute, regulation or order of any Third Party in each case which would or
might reasonably be expected (in any case to an extent which is material in the
context of the Elderstreet Group or the Millennium Group, as the case may be,
taken as a whole) to:

(i) make the Offer, its implementation or the acquisition or proposed
acquisition by Elderstreet or any member of the Wider Elderstreet Group of any
shares or other securities in, or control or management of, Millennium or any
member of the Wider Millennium Group void, illegal or unenforceable in any
jurisdiction, or otherwise directly or indirectly restrain, prevent, prohibit,
restrict or delay the same or impose additional conditions or obligations with
respect to the Offer or such acquisition, or otherwise impede, challenge or
interfere with the Offer or such acquisition, or require amendment to the terms
of the Offer or the acquisition or proposed acquisition of any Millennium Shares
or the acquisition of control of Millennium or the Wider Millennium Group by
Elderstreet;

(ii) limit or delay the ability of any member of the Wider Elderstreet Group or
any member of the Wider Millennium Group to acquire or to hold or to exercise
effectively, directly or indirectly, all or any rights of ownership in respect
of shares or other securities in, or to exercise voting or management control
over, any member of the Wider Millennium Group or any member of the Wider
Elderstreet Group;

(iii) require, prevent or delay the divestiture or alter the terms envisaged for
any proposed divestiture by any member of the Wider Elderstreet Group of any
shares or other securities in Millennium;

(iv) require, prevent or delay the divestiture or alter the terms envisaged for
any proposed divestiture by any member of the Wider Elderstreet Group or by any
member of the Wider Millennium Group of all or any portion of their respective
businesses, assets or properties or limit the ability of any of them to conduct
any of their respective businesses or to own or control any of their respective
assets or properties or any part thereof;

(v) except pursuant to Schedule 2 to the Takeovers Directive (Interim
Implementation) Regulations 2006, require any member of the Wider Elderstreet
Group or of the Wider Millennium Group to acquire, or to offer to acquire, any
shares or other securities (or the equivalent) in any member of either group
owned by any third party;

(vi) limit the ability of any member of the Wider Elderstreet Group or of the
Wider Millennium Group to conduct or integrate or co-ordinate its business, or
any part of it, with the businesses or any part of the businesses of any other
member of the Wider Elderstreet Group or of the Wider Millennium Group;

(vii) result in any member of the Wider Millennium Group or the Wider
Elderstreet Group ceasing to be able to carry on business under any name under
which it presently does so; or

(viii) otherwise adversely affect the business, assets, profits, financial or
trading position or prospects of any member of the Wider Millennium Group or of
the Wider Elderstreet Group, and all applicable waiting and other time periods
during which any Third Party could intervene under the laws of any relevant
jurisdiction having expired, lapsed or been terminated;

(e) all notifications and filings which are necessary or are reasonably
considered appropriate by Elderstreet having been made, all appropriate waiting
and other time periods (including any extensions of such waiting and other time
periods) under any applicable legislation or regulation of any relevant
jurisdiction having expired, lapsed or been terminated (as appropriate) and all
statutory or regulatory obligations in any relevant jurisdiction having been
complied with in each case in connection with the Offer or the acquisition or
proposed acquisition of any shares or other securities in, or control of,
Millennium or any other member of the Wider Millennium Group by any member of
the Wider Elderstreet Group or the carrying on by any member of the Wider
Millennium Group of its business;

(f) all Authorisations which are necessary or are reasonably considered
necessary or appropriate by Elderstreet in any relevant jurisdiction for or in
respect of the Offer or the acquisition or proposed acquisition of any shares or
other securities in, or control of, Millennium or any other member of the Wider
Millennium Group by any member of the Wider Elderstreet Group or the carrying on
by any member of the Wider Millennium Group of its business having been
obtained, in terms and in a form reasonably satisfactory to Elderstreet, from
all appropriate Third Parties or from any persons or bodies with whom any member
of the Wider Millennium Group has entered into contractual arrangements in each
case where the absence of such Authorisation would have a material adverse
effect on the Millennium Group taken as a whole and all such Authorisations
remaining in full force and effect and there being no notice or intimation of
any intention to revoke, suspend, restrict, modify or not to renew any of the
same;

(g) except as publicly announced by Millennium (by the delivery of an
announcement to a Regulatory Information Service) prior to the date of this
announcement or as fairly disclosed in writing to Elderstreet by or on behalf of
Millennium prior to the date of this announcement, there being no provision of
any arrangement, agreement, licence, permit, franchise or other instrument to
which any member of the Wider Millennium Group is a party, or by or to which any
such member or any of its assets is or are or may be bound, entitled or subject
or any circumstance, which, in each case as a consequence of the Offer or the
acquisition or proposed acquisition of any shares or other securities in, or
control of, Millennium or any other member of the Wider Millennium Group by any
member of the Wider Elderstreet Group or otherwise, could or might reasonably by
expected to result in (in any case to an extent which is or would be material in
the context of the Millennium Group taken as a whole):

(i) any monies borrowed by or any other indebtedness or liabilities (actual or
contingent) of, or any grant available to, any member of the Wider Millennium
Group being or becoming repayable or capable of being declared repayable
immediately or prior to its stated repayment date or the ability of any member
of the Wider Millennium Group to borrow monies or incur any indebtedness being
withdrawn or inhibited or becoming capable of being withdrawn;

(ii) the creation or enforcement of any mortgage, charge or other security
interest over the whole or any part of the business, property, assets or
interests of any member of the Wider Millennium Group or any such mortgage,
charge or other security interest (wherever created, arising or having arisen)
becoming enforceable;

(iii) any such arrangement, agreement, licence, permit, franchise or instrument,
or the rights, liabilities, obligations or interests of any member of the Wider
Millennium Group thereunder, being, or becoming capable of being terminated or
adversely modified or affected or any adverse action being taken or any
obligation or liability arising thereunder;

(iv) any asset or interest of any member of the Wider Millennium Group being or
falling to be disposed of or ceasing to be available to any member of the Wider
Millennium Group or any right arising under which any such asset or interest
could be required to be disposed of or could cease to be available to any member
of the Wider Millennium Group otherwise than in the ordinary course of business;

(v) any member of the Wider Millennium Group ceasing to be able to carry on
business under any name under which it presently does so;

(vi) the creation of liabilities (actual or contingent) by any member of the
Wider Millennium Group;

(vii) the rights, liabilities, obligations or interests of any member of the
Wider Millennium Group under any such arrangement, agreement, licence, permit,
franchise or other instrument or the interests or business of any such member in
or with any other person, firm, company or body (or any arrangement or
arrangements relating to any such interests or business) being terminated,
adversely modified or affected; or

(viii) the financial or trading position or the prospects or the value of any
member of the Wider Millennium Group being prejudiced or adversely affected, and
no event having occurred which, under any provision of any such arrangement,
agreement, licence, permit or other instrument, could result in any of the
events or circumstances which are referred to in paragraphs (i) to (viii) of
this condition (g) in any case to an extent which is or would be material in the
context of the Millennium Group taken as a whole;

(h) since 28 February 2006 and except as disclosed in Millennium's annual report
and accounts for the year then ended or as otherwise publicly announced by
Millennium (by the delivery of an announcement to a Regulatory Information
Service) prior to the date of this announcement or as otherwise fairly disclosed
in writing to Elderstreet by or on behalf of Millennium prior to the date of
this announcement no member of the Wider Millennium Group having:

(i) issued or agreed to issue, or authorised the issue of, additional shares of
any class, or securities convertible into or exchangeable for, or rights,
warrants or options to subscribe for or acquire, any such shares or convertible
securities other than as between Millennium and wholly-owned subsidiaries of
Millennium;

(ii) purchased or redeemed or repaid any of its own shares or other securities
or reduced or made any other change to any part of its share capital;

(iii) recommended, declared, paid or made any bonus, dividend or other
distribution whether payable in cash or otherwise (other than to Millennium or a
wholly-owned subsidiary of Millennium and excluding the Special Dividend);

(iv) made or authorised any change in its loan capital;

(v) (other than any acquisition or disposal in the ordinary course of business
or a transaction between Millennium and a wholly-owned subsidiary of Millennium)
merged with, demerged or acquired or disposed of or transferred, mortgaged or
charged or created any security interest over any assets or any right, title or
interest in any assets (including shares in any undertaking and trade
investments) or authorised the same (which in any case is material in the
context of the Millennium Group taken as a whole);

(vi) issued or authorised the issue of, or made any change in or to, any
debentures or (except in the ordinary course of business) incurred or increased
any indebtedness or liability (actual or contingent) which in any case is
material in the context of the Millennium Group taken as a whole;

(vii) entered into, varied or authorised any agreement, transaction, arrangement
or commitment (whether in respect of capital expenditure or otherwise) which:

(A) is of a long term, onerous or unusual nature or magnitude or which is or
could involve an obligation of such nature or magnitude; or

(B) could restrict the business of any member of the Wider Millennium Group; or

(C) is other than in the ordinary course of business, and which in any case is
material in the context of the Millennium Group taken as a whole;

(viii) entered into, implemented, effected or authorised any merger, demerger,
reconstruction, amalgamation, scheme, commitment or other transaction or
arrangement in respect of itself or another member of the Wider Millennium Group
otherwise than in the ordinary course of business which in any case is material
in the context of the Millennium Group taken as a whole;

(ix) entered into or varied the terms of, any contract, agreement or arrangement
with any of the directors or senior executives of any member of the Wider
Millennium Group;

(x) taken any corporate action or had any legal proceedings instituted or
threatened against it or petition presented or order made for its winding-up
(voluntarily or otherwise), dissolution or reorganisation or for the appointment
of a receiver, administrator, administrative receiver, trustee or similar
officer of all or any material part of its assets and revenues or any analogous
proceedings in any jurisdiction or appointed any analogous person in any
jurisdiction which in any case is material in the context of the Millennium
Group taken as a whole;

(xi) been unable, or admitted in writing that it is unable, to pay its debts or
having stopped or suspended (or threatened to stop or suspend) payment of its
debts generally or ceased or threatened to cease carrying on all or a
substantial part of its business in any case with a material adverse effect on
the Millennium Group taken as a whole;

(xii) waived or compromised any claim which is material in the context of the
Millennium Group taken as a whole;

(xiii) made any alteration to its memorandum or articles of association which is
material in the context of the Offer; or

(xiv) entered into any agreement, commitment or arrangement or passed any
resolution or made any offer (which remains open for acceptance) or proposed or
announced any intention with respect to any of the transactions, matters or
events referred to in this condition (h);

(i) since 28 February 2006 and except as disclosed in Millennium's annual report
and accounts for the year then ended or as otherwise publicly announced by
Millennium (by the delivery of an announcement to a Regulatory Information
Service) prior to the date of this announcement or as otherwise fairly disclosed
in writing to Elderstreet by or on behalf of Millennium prior to the date of
this announcement:

(i) there having been no adverse change or deterioration in the business,
assets, financial or trading positions or profit or prospects of any member of
the Wider Millennium Group which in any case is material in the context of the
Millennium Group taken as a whole;

(ii) no contingent or other liability of any member of the Wider Millennium
Group having arisen or become apparent or increased which in any case is
material in the context of the Millennium Group taken as a whole;

(iii) no litigation, arbitration proceedings, prosecution or other legal
proceedings to which any member of the Wider Millennium Group is or may become a
party (whether as plaintiff, defendant or otherwise) having been threatened,
announced, implemented or instituted by or against or remaining outstanding
against or in respect of any member of the Wider Millennium Group which in any
case is material in the context of the Millennium Group taken as a whole; and

(iv) (other than as a result of the Offer) no enquiry or investigation by, or
complaint or reference to, any Third Party having been threatened, announced,
implemented, instituted by or against or remaining outstanding against or in
respect of any member of the Wider Millennium Group which in any case is
material in the context of the Millennium Group taken as a whole;

(j) Elderstreet not having discovered:

(i) that any financial or business or other information concerning the Wider
Millennium Group disclosed at any time by or on behalf of any member of the
Wider Millennium Group, whether publicly, to any member of the Wider Elderstreet
Group or otherwise, is misleading or contains any misrepresentation of fact or
omits to state a fact necessary to make any information contained therein not
misleading and which was not subsequently corrected before the date of this
announcement by disclosure either publicly or otherwise to Elderstreet to an
extent which in any case is material in the context of the Millennium Group as a
whole;

(ii) that any member of the Wider Millennium Group is subject to any liability
(actual or contingent) which is not disclosed in Millennium's annual report and
accounts for the financial year ended 28 February 2006 and which in any case is
material in the context of the Millennium Group taken as a whole; or

(iii) any information which affects the import of any information disclosed at
any time by or on behalf of any member of the Wider Millennium Group to an
extent which is material in the context of the Millennium Group taken as a
whole.

For the purpose of these conditions:

(a) 'Third Party' means any government, government department or governmental,
quasigovernmental, supranational, statutory, regulatory or investigative body,
authority (including any national anti-trust or merger control authority),
court, trade agency, association, institution or professional or environmental
body or any other person or body whatsoever in any relevant jurisdiction;

(b) a Third Party shall be regarded as having 'intervened' if it has decided to
take, institute, implement or threaten any action, proceeding, suit,
investigation, enquiry or reference or made, proposed or enacted any statute,
regulation, decision or order or taken any measures or other steps or required
any action to be taken or information to be provided or otherwise having done
anything and 'intervene' shall be construed accordingly;

(c) 'Authorisations' means authorisations, orders, grants, recognitions,
determinations, certificates, confirmations, consents, licences, clearances,
provisions and approvals;

(d) 'Wider Elderstreet Group' means Elderstreet and its subsidiaries and
subsidiary undertakings and associated undertakings (including any company in
which any member of the Elderstreet Group is interested or any undertaking in
which Elderstreet and such undertakings (aggregating their interests) have a
direct or indirect interest in 20 per cent. or more of the voting equity capital
of an undertaking); and

(e) 'Wider Millennium Group' means Millennium and its subsidiaries and
subsidiary undertakings and associated undertakings (including any company in
which any member of the Millennium Group is interested or any undertaking in
which Millennium and such undertakings (aggregating their interests) have a
direct or indirect interest in 20 per cent. or more of the voting equity capital
of an undertaking).

Subject to the requirements of the Panel, Elderstreet reserves the right to
waive all or any of the above conditions, in whole or in part, except conditions
(a) to (c).

Conditions (b) to (j) (inclusive) must be fulfilled, be determined by
Elderstreet to be or remain satisfied or (if capable of waiver) be waived by
midnight on the 21st day after the later of the first closing date of the Offer
and the date on which condition (a) is fulfilled (or in each case such later
date as Elderstreet may, with the consent of the Panel, decide), failing which
the Offer will lapse. Elderstreet shall be under no obligation to waive (if
capable of waiver), to determine to be or remain satisfied or to treat as
fulfilled any of conditions (b) to (j) (inclusive) by a date earlier than the
latest date specified above for the fulfillment of that condition.

If the Panel requires Elderstreet to make an offer for the Millennium Shares
under the provisions of Rule 9 of the Code, Elderstreet may make such
alterations to the conditions of the Offer, including to condition (a), as are
necessary to comply with the provisions of that Rule.

If the Offer lapses it will cease to be capable of further acceptance.
Millennium Shareholders who have accepted the Offer and Elderstreet shall then
cease to be bound by acceptances delivered on or before the date on which the
Offer lapses.


APPENDIX II
BASES OF CALCULATION AND SOURCES OF INFORMATION

In this announcement, unless otherwise stated, or the context otherwise
requires, the following bases of calculation and sources of information have
been used:

(a) The value placed by the Offer on the existing issued ordinary share capital
of Millennium is based on 16,141,283 Millennium Shares in issue on 28 November
2006.

(b) The share price of Elderstreet is the closing middle market quotation of
Elderstreet Shares and is derived from the London Stock Exchange Daily Official
List on the relevant date.


APPENDIX III
DEFINITIONS

The following definitions apply throughout this announcement, unless the context
requires otherwise:


'Act'          the Companies Act 1985 (as amended)

'Code'         The City Code on Takeovers and Mergers

'C             holders of C Shares
Shareholders'

'C Shares'     the issued 'C' shares of 5p each in the capital of Elderstreet

'Elderstreet'  Elderstreet VCT plc

'Elderstreet   the board of directors of Elderstreet
Board' or
'Elderstreet
Directors'

'Elderstreet   funds managed by the Manager or Elderstreet Investments Limited
Funds'

'Elderstreet   Elderstreet and its subsidiaries and subsidiary undertakings, if
Group'         any

'Elderstreet   a holder of Elderstreet Shares
Shareholder'

'Elderstreet   the issued ordinary shares of 5p each in Elderstreet
Shares'

'Enlarged      Elderstreet as enlarged by the Merger
Group'

'Form of       the form of acceptance relating to the Offer
Acceptance'

'ICTA'         Income and Corporation Taxes Act 1988 (as amended)

'Listing       the listing rules issued by the FSA from time to time
Rules'

'London Stock  London Stock Exchange plc
Exchange'

'Manager'      Elderstreet Private Equity Limited, a wholly owned subsidiary of
               Elderstreet Investments Limited

'Merger'       the acquisition by Elderstreet of Millennium pursuant to the
               Offer

'Millennium'   Elderstreet Millennium Venture Capital Trust plc

'Millennium    the board of directors of Millennium
Board' or
'Millennium
Directors'

'Millennium    Millennium and its subsidiaries and subsidiary undertakings, if
Group'         any

'Millennium    a holder of Millennium Shares
Shareholder'

'Millennium    the existing unconditionally allotted or issued ordinary shares
Shares'        of 10p each in Millennium and any further such shares which are
               unconditionally allotted or issued and fully paid before the date
               on which the Offer closes (or such earlier date, not being
               earlier than the date on which the Offer becomes or is declared
               unconditional as to acceptances as Elderstreet may, subject to
               the Code, decide)

'Net Asset     Net Assets per share
Value' or
'NAV'

'Net Assets'   gross assets less all liabilities (excluding contingent
               liabilities)

'New           the new Elderstreet Shares to be issued pursuant to the Merger
Elderstreet
Shares'

'Offer'        the offer to be made by Elderstreet to acquire Millennium Shares
               on the terms set out in this announcement and, where the context
               admits, any subsequent revision, variation, extension or renewal
               thereof

'Offer         the document containing the Offer
Document'

'Official      the official list of the UKLA
List'

'Panel'        the Panel on Takeovers and Mergers

'Prospectus'   the prospectus equivalent to be issued by Elderstreet in
               connection with the Merger

'Qualifying    an individual who subscribes for or acquires shares in a VCT and
Shareholder'   satisfies the conditions for eligibility for tax relief available
               to investors in a VCT pursuant to section 842AA and schedule 28B
               ICTA

'Regulatory    any of the services set out in Appendix 3 to the Listing Rules
Information    from time to time
Service'

'Smith &       Smith & Williamson Corporate Finance Limited
Williamson'

'Special       the interim dividend of 22.5p per Millennium Share which is
Dividend'      conditional on the Offer becoming or being declared unconditional
               in all respects

'subsidiary'   shall have the meaning given to it in Section 736 of the Act

'subsidiary    shall have the meaning given to it in Section 258 of the Act
undertaking'

'UKLA'         the Financial Services Authority in its capacity as the competent
               authority for the purposes of Part VI of the Financial Services
               and Markets Act 2000

'United        the United Kingdom of Great Britain and Northern Ireland
Kingdom' or
'UK'

'United        the United States of America (including any states of the United
States'        States of America and the District of Columbia), its possessions
               and territories, and all other areas subject to its jurisdiction

'US Person'    a US person as defined in Regulation S under the United States
               Securities Act of 1933 (as amended)

'VCT'          a company approved as a venture capital trust under Section 842
               AA ICTA by the Board of the Inland Revenue

'VCT Merger    the Venture Capital Trust (Winding Up and Mergers) (Tax)
Regulations'   Regulations 2004)





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