Disposal

Restaurant Group PLC
23 November 2005

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN WHOLE OR IN PART, IN OR INTO
THE US, CANADA, AUSTRALIA OR JAPAN

The Restaurant Group Plc
(the 'Company')

Sale of the business and assets of Caffe Uno for £33million in cash

Intention to return up to £35 million to shareholders



Introduction



The Restaurant Group is pleased to announce that it has agreed to sell the
business and assets of Caffe Uno to Craftbutton (trading as Paramount
Restaurants Ltd) for a gross consideration of £33 million pounds in cash.
Completion is expected on 12 December 2005.



For the past four years, The Restaurant Group's strategy has been to focus on
trading areas that have distinctive barriers to entry, good growth prospects and
high returns.  Caffe Uno has historically provided satisfactory returns and
cashflows.  However, the Directors believe that the High Street, where Caffe Uno
operates, has become a more competitive environment and that spending patterns
have become more focused on out of town locations with easy parking and access.
The Directors believe that it is becoming increasingly difficult for  Caffe
Uno to produce the levels of sustainable growth in profits and cashflows that
would, when set against The Restaurant Group's key objective of growing
shareholder value, justify continuing and further developing the Caffe Uno
business.



Details of the transaction



Caffe Uno operates 58 High Street Italian restaurants.  The Restaurant Group has
agreed to sell 53 of these units to Craftbutton for a gross cash consideration
of £33 million.  Craftbutton is jointly owned by JOHCM Private Equity and Dawnay
Day Group, and currently operates restaurants under the Chez Gerard, Cafe Fish,
Livebait and Bertorelli's brands.  In connection with the sale certain usual
warranties and indemnities have been given which are subject to conditions both
in respect of quantum and period.  The remaining five Caffe Uno units are
already part of The Restaurant Group's active site management programme and will
either be sold or rebranded.  Additionally, The Restaurant Group operates three
Caffe Uno derivatives within its airports business, under its Concessions
division; these will continue to be run by the Company under licence from
Paramount Restaurants Ltd.



In the year ended 31 December 2004 the Caffe Uno business being sold had
turnover of £36.2 million, EBIT of £4.9 million and gross assets of £24.8
million.  For the half year ended 30 June 2005 the business had EBIT of £1.5
million compared to £2.3 million in the corresponding period for 2004 (all
figures calculated under IFRS).



Benefits of the transaction



The sale of Caffe Uno will allow the Group to focus on its core activities in
Leisure and Concessions, both of which the Directors believe have good growth
prospects, and to reduce significantly its exposure to the challenging and
highly competitive UK High Street environment.  It will also allow the Group to
direct further capital expenditure to the ongoing brands in its Leisure and
Concessions divisions.



The Directors believe that a key factor in continuing to grow shareholder value
is the delivery of growing and sustainable profits and cashflows from The
Restaurant Group's businesses.  The quality of earnings produced from its
Leisure and Concessions business is, the Directors believe, superior to those
produced by the High Street businesses.  Subsequent to the transaction The
Restaurant Group will operate 164 restaurants in its Leisure division, 41
restaurants in Concessions, 29 Garfunkels and retain its 40% shareholding in
Living Ventures.



Use of Proceeds



As at 30 June 2005 The Restaurant Group had net assets of £77.1 million and net
borrowings of £40.1 million.   The net proceeds will, initially, be used to
reduce group indebtedness.



Having considered the capital requirements of the ongoing group, the Board
intends to return up to £35 million cash to shareholders.  Any return is
expected to be accompanied by a share consolidation, in order to assist
comparability of share price, EPS and dividends.  Relevant documents to
shareholders will be despatched in due course, with the return of value expected
to be made by the second quarter of 2006, subject to necessary approvals being
received.  As part of this transaction, The Restaurant Group has increased its
banking facility by £10 million to £80 million.



Financial Effects



The Directors estimate that the net impact of the sale and return of capital
will be broadly earnings neutral in the year ending 31 December 2006, based on
the current share price.  The sale is expected to give rise to a profit on sale
of approximately £1.0 million (under IFRS).  The above statements regarding
earnings and profit on sale should not be construed as profit forecasts and
shareholders should not assume that earnings per share of the Group will
necessarily be higher or lower than in the previous year.



Current trading



Trading has continued in line with the Board's expectations with Group like for
like sales for the year to date being +3%.



Alan Jackson, Chairman of The Restaurant Group plc, said:



'Consistent with the strategy set out in 2002, the sale of Caffe Uno will leave
the Group streamlined and focused on businesses that have demonstrated good
growth.



Non-High Street and well situated locations, with higher barriers to entry, are
where the opportunity for future growth lies.



The composition of The Restaurant Group's business means that we are now well
placed to continue to deliver good growth in the future.'



                                                                23 November 2005



There will be a conference call for analysts at 8.45am.  The dial-in details
are: 020 7784 1015.






Enquiries:

The Restaurant Group plc                               020 7747 7750
    Alan Jackson, Executive Chairman
    Andrew Page, Group Managing Director

    Stephen Critoph, Finance Director

College Hill
    Matthew Smallwood                                  020 7457 2020








Important Notice



1) The information in this announcement including, without limitation,
references to the expected effect of the sale and intended return of value on
the Company's future earnings per share should not be interpreted as a profit
forecast nor should any information contained herein be interpreted to mean that
the future earnings per share of the Company following the sale and intended
return of value will necessarily match or exceed the historical published
earnings per share.



This announcement includes 'forward-looking statements'. All statements other
than statements of historical facts included in this announcement, including,
without limitation, those regarding the Company's financial position, business
strategy, plans and objectives of management for future operations (including
development plans and objectives relating to the Company's products and
services), are forward-looking statements. Such forward-looking statements
involve known and unknown risks, uncertainties and other important factors which
could cause the actual results, performance or achievements of the Company or
those markets and economies to be materially different from future results,
performance or achievements expressed or implied by such forward-looking
statements. Such forward-looking statements are based on numerous assumptions
regarding the Company's present and future business strategies and the
environment in which the Company will operate in the future and such assumptions
may or may not prove to be correct. These forward-looking statements speak only
as at the date of this announcement. The Company expressly disclaims any
obligation (other than pursuant to the Listing Rules of the UKLA) or undertaking
to disseminate any updates or revisions to any forward-looking statements
contained herein to reflect any change in the Company's expectations with regard
thereto or any change in events, conditions or circumstances on which any such
statement is based.





2) Prices and value of, and income from, shares may go down as well as up and an
investor may not get back the amount invested.  It should be noted that past
performance is no guide to future performance.  Persons needing advice should
contact an independent financial adviser.









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