Liberty Pensions Acquired

Schroders PLC
10 May 2000


               SCHRODERS PLC BUYS LIBERTY PENSIONS
                                
      A STRATEGIC MOVE TO EMBRACE THE UK DC PENSIONS MARKET

Schroders plc announces that it is to buy Liberty International
Pensions Limited ('LIPL'), a UK life insurance and pensions
company, which trades as Liberty Pensions.

Schroders will acquire 100% of the ordinary share capital of
LIPL from UK property group Liberty International PLC (which
owns 80% of the share capital of LIPL) and the Trustees of the
BT Pension Scheme and Capital Group International Inc (which own
10% each) for a cash consideration of £60 million to be met from
the existing cash resources of Schroders plc.  LIPL had net
assets attributable to ordinary shareholders, as at 31 December
1999, of £32.7 million, principally in cash.  The transaction is
subject to regulatory consent, which, it is anticipated, will be
obtained by the end of September.

Liberty Pensions is a market-leading, specialist provider of
defined contribution ('DC') services with unit-linked
policyholder funds of £3.2 billion.  As a result of this
acquisition, Schroders will be able to offer a complete range of
flexible DC services.  These services will include investment
management (active and passive), communication and member
administration services which can be either combined or provided
separately.

David Salisbury, Chief Executive of Schroders plc, said:

'We recognise the growing trend towards DC pension provision in
the UK which will be accelerated by the introduction of
stakeholder pensions in April 2001.  This acquisition enables us
to achieve our stated aim to be a leading DC service provider
offering a premier range of services to the group UK DC pensions
market, complementing our existing defined benefit position.

'The excellent strategic fit of combining Schroders' asset
management capabilities and Liberty Pensions' expertise allows
us to expand significantly our DC services which will be of
substantial benefit to our clients, both current and
prospective.'

The acquisition of Liberty Pensions will provide Schroders with:

-    A strong dedicated DC team of over 50 people with a wealth
     of knowledge and experience;

-    A highly developed customer service centre allowing
     flexible DC services to be provided;

-    An index-tracking investment management capability,
     available to both defined benefit and DC clients, provided
     by a substantial passive fund manager, Hermes Investment
     Management Limited (through LIPL's wholly owned subsidiary,
     Hermes Liberty International Pensions Limited); and

-    A state-of-the-art IT infrastructure for DC pensions
     administration.

David Fischel, Managing Director of Liberty International PLC,
said:

'This transaction is very much in line with our stated strategy
of focusing on our core property business.  We are delighted
that an organisation of the stature of Schroders is acquiring
this business to build on the progress and success already
accomplished over the past 3 years.

'I am confident that our existing clients and staff will be in
extremely good hands under Schroders' ownership.'

Alastair Ross Goobey, Chief Executive of Hermes Investment
Management, said:

'We are delighted with our prestigious new partner, Schroders.
We see this as an outstanding opportunity for both organisations
to work together to develop business in the rapidly growing
market for DC pensions.

'Schroders' position in the marketplace coupled with our
capabilities in index matching will make a formidable
combination.'

For further information please contact:

Schroders plc David Salisbury, Chief Executive   020 7658 6962
Schroders plc Julian Samways, Marketing          020 7658 6166
              Director                           Mobile: 0370
                                                 496166
GCI Financial Rupert Ashe                        020 7398 0808
              Sarah Roberts                      020 7398 0820

Background Information
----------------------

About Liberty Pensions

LIPL was established in 1996 as a UK authorised insurance
company to provide simple, low cost pension services.  From the
start it was recognised that considerable investment would be
required in order to create a new business model capable of
achieving flexible, low cost administration.

LIPL has focused on the corporate pensions market as offering
the greatest potential for profitable growth.  Having developed
systems capable of delivering flexible and cost efficient GPPs,
LIPL, under the trading name of 'Liberty Pensions' began to
offer its services to employers, trustees, affinity groups, fund
managers and insurance companies as a third party administrator
of both GPPs and occupational DC pension schemes.

Liberty Pensions has now established a reputation in the UK
corporate pensions market for high quality service and thought
leadership in the area of DC provision.  They now have a
growing, prestigious list of clients.

Liberty International PLC recently announced it had decided to
focus on its dominant business activity of commercial and retail
property development and investment.  Since LIPL's activities
are inconsistent with this focus, it has concluded that the
business' strategic development would be better realised as part
of another organisation.

Index-tracking services - Hermes
--------------------------------

Hermes Liberty International Pensions Limited (HLIP), a wholly
owned subsidiary of LIPL, offers an international index tracking
investment management capability to institutional pension funds.
Hermes Investment Management Limited ('Hermes') performs all the
fund management activities with HLIP acting as the access
channel to Hermes' index tracking expertise, providing
administration services and the underlying contract of
insurance.

This business will be branded 'Schroder Hermes'.

Schroders remains fully committed to the market as an active
manager, but recognises the strategic importance of index
tracking management to the DC pensions market.  This business
enables Schroders to continue to service their clients' needs in
the corporate pensions market.

Notes to editors:

A Defined Benefit (DB) pension scheme is one where the pension
benefit payable at retirement is defined by a formula - often
expressed as a percentage of salary for each year of service.
The cost of funding such a pension benefit is unknown since it
will depend on actual future experience, including, amongst
other things, future investment returns.  It is usual that the
employer sponsoring such a scheme bears the investment risk - ie
the risk that investment returns are poor.

A Defined Contribution (DC) pension scheme on the other hand
does not operate on a defined pension benefit basis.  Instead,
the contribution payable is defined and the benefit is simply
what the accumulated value of these contributions will provide
at retirement.  It is usual that the individual member of such a
scheme bears the investment risk.

The UK pensions market is currently estimated to comprise funds
under management in excess of £1,000 billion, some 40% by value
of the total UK personal finance assets.  (source: AUTIF
estimate)

Current membership of corporate sponsored DC pension schemes is
estimated to represent approximately 25% of the total company
pensions market and there is a clearly acknowledged trend
towards DC away from DB type arrangements even amongst the
largest employers.  For employers, the appeal of switching from
DB to DC pension schemes is to make a growing part of their
employee benefit costs more stable and predictable and avoid
pension fund deficits that can arise under DB pension schemes.
In addition, recent legislation and new accounting disclosure
requirements make DB pension schemes potentially more onerous to
operate.

From both the employer's and employee's point of view, DC
schemes offer the flexibility required for modern working
practices.  They are more portable and typically offer greater
investment choice as part of the flexible benefit packages
increasingly required to recruit and retain high quality staff.