Response to PIGIT Offer

Securities Trust of Scotland PLC
23 March 2005

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES,
CANADA, AUSTRALIA, THE REPUBLIC OF IRELAND OR JAPAN.

Securities Trust of Scotland plc

Reconstruction proposals and formal rejection of the PIGIT Offer

SUMMARY OF THE BOARD'S PROPOSALS

The Board of Securities Trust of Scotland plc is today dispatching a circular to
Shareholders recommending that they do not accept the unsolicited hostile offer
announced by Intelli Corporate Finance Limited on behalf of Perpetual Income and
Growth Investment Trust plc and confirming that the Board intends, upon the
PIGIT Offer lapsing, to put forward proposals to reconstruct the Company.

The Board, which has been so advised by JPMorgan Cazenove, strongly believes
that its Proposals are superior and offer better value for Shareholders than the
PIGIT Offer.  Accordingly, the Board is unanimously recommending to Shareholders
that they do not accept the PIGIT Offer.

If Shareholders support the Board and the hostile PIGIT Offer fails,
Shareholders will be able to vote on the Board's Proposals, which will be put
forward as soon as practicable.   Shareholders will then have the option to
exchange their Securities Trust Shares for their choice of:

•        shares in New Securities Trust, a Martin Currie-managed successor to
Securities Trust, which values the NAV of each Securities Trust Share at 112.5p*
as opposed to the PIGIT Offer which values the NAV of each Securities Trust
Share at only 110.7p*. New Securities Trust will:

o       have a similar investment objective and dividend policy to Securities
Trust;

o       aim to provide an increase in Shareholders' annual income as opposed to
a 20-31% reduction in income under the PIGIT Offer;

o       have a basic management fee of 0.4% of gross assets as compared with
PIGIT's basic management fee of 0.75% of gross assets; and

o       have a discount protection mechanism

and/or

•        shares in Lowland Investment Company plc (a better performing
investment trust than PIGIT as demonstrated below) which values the NAV of each
Securities Trust Share at 110.9p* and values each Securities Trust Share at
114.9p* on a share price basis, as opposed to the PIGIT Share offer which values
each Securities Trust Share at only 107.7p*

and/or

•        cash in respect of 100% of a Shareholder's Securities Trust Shares,
should they so wish, at a value of 112.2p* per Securities Trust Share as opposed
to PIGIT's Offer which is only offering 108.2p* cash per Securities Trust Share
on a partial basis

or any combination of the above as Shareholders wish.

Securities Trust intends to pay dividends amounting to 4.7p per Securities Trust
Share prior to the implementation of the Board's Proposals.

Advantages of the Board's Proposals

The Board believes that its Proposals will:

  • offer better value than the PIGIT Offer
  • offer more choice than the PIGIT Offer because Shareholders will have free
    choice between shares in New Securities Trust, shares in Lowland or cash
    whereas the PIGIT Offer provides only a partial cash offer and/or new PIGIT
    Shares
  • offer the option of higher income than the PIGIT Offer because the Board's
    Proposals aim to provide Shareholders who elect for New Securities Trust
    Shares with an increase in their annual income as opposed to a 20 - 31%
    reduction in their income under the PIGIT Offer
  • offer Shareholders the option, in Lowland, of a better performing
    investment trust than PIGIT.

Enquiries:                                  
Neil Donaldson                                                     020 7353 4200
Chairman designate, Securities Trust of Scotland plc

Angus Gordon Lennox                                                 07768 503516
JPMorgan Cazenove Limited

Kirstie Hamilton / Kate Inverarity Tulchan                         020 7353 4200
Communications

Willie Watt / Mike Woodward                                        0131 229 5252
Martin Currie Investment Management Limited

*The figures shown are illustrative only, calculated as at 8 March 2005, and do
not constitute forecasts. The figures resulting from the Proposals will depend
on the net assets of the Company at the time of implementation of the Proposals
and the factors identified in the assumptions set out in Appendix II. These
figures do not take into account an estimate of the costs that may be incurred
by the Company in reorganising its portfolio and realising its investments.

JPMorgan Cazenove Limited is acting for Securities Trust in relation to the
matters referred to in this announcement and no one else and will not be
responsible to anyone other than Securities Trust for providing the protections
offered to clients of JPMorgan Cazenove Limited nor for providing advice in
relation to the matters referred to in this announcement.

JPMorgan Cazenove Limited of 20 Moorgate, London EC2R 6DA, which is authorised
and regulated by the Financial Services Authority, has approved the contents of
this announcement for the purposes of Section 21 of the Financial Services and
Markets Act 2000.


Securities Trust of Scotland plc

Reconstruction proposals and formal rejection of the PIGIT Offer

The Board of Securities Trust is today dispatching a circular to Shareholders
recommending that they do not accept the PIGIT Offer and confirming that the
Board intends, upon the PIGIT Offer lapsing, to put forward Proposals to
reconstruct the Company.

The Board, which has been so advised by JPMorgan Cazenove, strongly believes
that its Proposals are superior and offer better value for Shareholders than the
PIGIT Offer.  Accordingly, the Board is unanimously recommending to Shareholders
that they do not accept the PIGIT Offer.

Background

Securities Trust is a long-established investment trust which was incorporated
in 1889. Its objective is to achieve rising income and long-term capital growth
by investment in the United Kingdom. The emphasis is on companies with the
potential for strong earnings and dividend growth. The performance of the
Company is measured against the FTSE All-Share Index. Securities Trust is
managed by Martin Currie.

  • Over the past five years, Securities Trust's NAV per share has
    outperformed the FTSE All-Share Index on a total return basis.
  • Over 10 years, Securities Trust has had a higher yield than the FTSE
    All-Share Index.
  • Over the financial years ended March 1995 to March 2004, Securities
    Trust's dividend, in aggregate, has grown in real terms.

Notwithstanding these achievements, the Board decided on 29 April 2004 to
conduct a strategic review to determine whether the Company could be managed in
a way which would further enhance returns for Shareholders in the future. The
Board included the results of the strategic review in the Company's interim
results on 28 October 2004. As a consequence of the review, a significant
proportion of the Company's borrowings was repaid and the gearing policy was
revised. The investment approach was also revised so that the managers now have
greater freedom to deviate from the benchmark index, thereby allowing greater
emphasis on stock picking. The Board announced that the main focus would be on
an above-average yielding portfolio with scope to deliver superior dividend
growth. The Board also reinforced its commitment to growing the Company's
dividend on an annual basis.

Reasons why the Board did not pursue PIGIT's approach in July 2004

During the strategic review, PIGIT approached Securities Trust with proposals to
merge the two companies. The Board, advised by JPMorgan Cazenove, did not
proceed with these discussions on the grounds that:

  • The PIGIT proposals, then as now, would have resulted in a significant
    reduction in income for Shareholders
  • Securities Trust was, and is, a very different investment proposition to
    PIGIT with a different return profile
  • Securities Trust was in the middle of conducting a strategic review with
    the aim of enhancing returns for Shareholders
  • Perhaps most importantly, if the Securities Trust Board had wished to
    pursue such an option as the one PIGIT was offering, then it would not have
    been correct to engage only with PIGIT but instead to have considered the
    other options available. In Lowland, the Board believes that it has found a
    significantly better option than PIGIT.

New strategy kept under review

The Board noted at the time of the Company's interim results that it would keep
the implementation of the revised strategy under review and would decide upon
its success by no later than 31 December 2005.

The Board had hoped that this new strategy would have been given time to prove
itself.

Offer on behalf of Perpetual Income and Growth Investment Trust plc

The Board wrote to Shareholders on 8 March 2005 with its initial views on the
unsolicited hostile offer for the entire issued and to be issued share capital
of the Company made on behalf of PIGIT. PIGIT has now made a formal Offer and,
having considered this Offer carefully, the Board sets out below why it believes
that its Proposals are superior and offer better value for Shareholders.

THE BOARD STRONGLY ADVISES SHAREHOLDERS NOT TO ACCEPT THE PIGIT OFFER.

The Board's Proposals

In the light of the PIGIT Offer, the Board has reviewed its available options,
and has concluded that its Proposals are in the best interests of Shareholders
as a whole. The Board's Proposals, which will be voted on by Shareholders if the
PIGIT Offer fails, will comprise a members' voluntary liquidation and
reconstruction of the Company. The Proposals will allow Shareholders to elect
to:

•        rollover all or part of their investment in the Company in a
tax-efficient manner into New Securities Trust, managed by Martin Currie, which
will be the successor vehicle to the Company. New Securities Trust will be
managed by Martin Currie in a similar way to the existing Company, with its
recently enhanced investment strategy and strengthened management team, but will
have the benefit of a discount management mechanism described in further detail
below;

and/or

•        rollover all or part of their investment in the Company in a tax
efficient manner into Lowland, an existing investment trust managed by
Henderson, further details of which are set out below;

and/or

•        realise all or part of their investment in the Company for cash.

The Proposals will be subject to the approval of Securities Trust Shareholders
and Lowland Shareholders. Subject to relevant UK tax clearances being obtained,
UK Shareholders will be able to rollover their investment into New Securities
Trust and/or Lowland in a tax-efficient manner. Details of New Securities Trust
and Lowland are set out below.

Advantages of the Board's Proposals

The Board believes that its Proposals will:

•        offer better value than the PIGIT Offer because Shareholders will have
a choice of:

o       shares in New Securities Trust, a Martin Currie-managed successor to
Securities Trust, which values the NAV of each of the Securities Trust Shares at
112.5p* as opposed to the PIGIT Offer which values the NAV of each of the
Securities Trust Shares at only 110.7p*. New Securities Trust will:

•         have a similar investment objective and dividend policy to
Securities Trust;

•         aim to provide an increase in Shareholders' annual income as opposed
to a 20-31% reduction in income under the PIGIT Offer;

•         have a basic management fee of 0.4% of gross assets as compared with
PIGIT's basic management fee of 0.75% of gross assets; and

•         have a discount protection mechanism

and/or

o       shares in Lowland (a better performing investment trust than PIGIT)
which values the NAV of each of the Securities Trust Shares at 110.9p* and
values each of the Securities Trust Shares at 114.9p* on a share price basis, as
opposed to the PIGIT Share offer which values each of the Securities Trust
Shares at only 107.7p*

and/or

o       cash in respect of 100% of the Securities Trust Shares, should a
Shareholder so wish, at a value of 112.2p* per Securities Trust Share as opposed
to PIGIT's Offer which is only offering 108.2p* cash per Securities Trust Share
on a partial basis

or any combination of the above as Shareholders wish.

Securities Trust intends to pay dividends amounting to 4.7p per share prior to
the implementation of the Board's Proposals. 2.0p of this 4.7p will be a special
dividend, payable immediately prior to implementation of the Board's Proposals.

•        offer more choice than the PIGIT Offer because:

o       Shareholders will have FREE CHOICE between shares in New Securities
Trust, shares in Lowland or cash, whereas the PIGIT Offer provides only a
partial cash offer and/or new PIGIT Shares

•        offer the option of higher income than the PIGIT Offer because:

o       the Board's Proposals aim to provide Shareholders who elect for New
Securities Trust Shares with an increase in their annual income as opposed to a
20 - 31% reduction in their income under the PIGIT Offer

•        offer Shareholders the choice of a better performing investment trust
than PIGIT as the table below demonstrates:

o       Lowland has performed better
Total Return to 1 March 2005*

                          1 Year                    3 Years                      5 Years
                       %       Peer group          %        Peer group          %       Peer group
                                  ranking                      ranking                     ranking

Lowland             25.0    2nd out of 26       53.5    1st out of  25      102.5    1st out of 19

PIGIT               20.5    8th out of 26       42.8     2nd out of 25       90.3    2nd out of 19

* Being the latest practicable date prior to the announcement of the Offer.

 (Source: Datastream and the PIGIT Offer Document)

o       Lowland has a superior rating to PIGIT

o       Lowland has pursued a progressive dividend policy and has grown its
dividend at an annualised compound rate of 5.2% over the past five years which
compares to a rate of 3.7% for PIGIT (source: AITC; as at 28 February 2005).

Illustrative entitlements under the Board's Proposals compared with the PIGIT
Offer

The number of New Securities Trust Shares, or New Lowland Shares, or the amount
of cash to which a Shareholder electing for any of these options will become
entitled under the Board's Proposals, can only be determined after the effective
date of the Proposals.

By way of illustration only, however, had the Proposals become effective on 8
March 2005 (the date used for calculating the illustrative entitlements as
defined in the document containing PIGIT's Offer), based on the Company's
calculation of its NAV of 117.2p as at 8 March 2005 and the assumptions set out
in Appendix II below, the entitlements of a Shareholder on a per share basis
would have been as follows:

The Board's Proposals                 Formula      Attributable   Attributable
                                  Asset Value   Net Asset Value   Market value
Election                                  (p)               (p)            (p)

New Securities Trust                    112.5             112.5            N/A

Lowland                                 112.5             110.9          114.9

Cash                                    112.5             112.2          112.2



The PIGIT Offer                       Formula      Attributable   Attributable
                                  Asset Value   Net Asset Value   Market value
Election                                  (p)               (p)            (p)

PIGIT shares                            111.0             110.7          107.7

Partial cash option                     111.0             108.2          108.2

The figures shown are illustrative only, calculated as at 8 March 2005 and do
not constitute forecasts. The figures resulting from the Proposals will depend
on the net assets of the Company at the time of implementation of the Proposals
and the factors identified in the assumptions in Appendix II. These figures do
not take into account an estimate of the costs that may be incurred by the
Company in reorganising its portfolio and realising its investments.

Dividends

Dividends paid to Securities Trust Shareholders have increased for nine
consecutive years, in aggregate, by an amount in excess of the rate of inflation
in the United Kingdom over that period. The Board intends to declare one or more
interim dividends (assuming the Offer lapses and Proposals proceed) amounting in
aggregate to 4.7p per Securities Trust Share, to be paid to those Shareholders
on the register at the relevant record date.

If Shareholders elect for New Securities Trust Shares, the Board's Proposals
will aim to provide them with an increase in their annual income as opposed to a
20-31% reduction in their income under the PIGIT Offer.

Elections under the Proposals

For the purpose of determining the entitlement of Shareholders to New Securities
Trust Shares and/or New Lowland Shares under the Board's Proposals, a value
equal to 100% of the formula asset value of a Securities Trust Share on the
calculation date (''FAV'') will be used. For the purpose of determining the
entitlement of Shareholders to cash, a value equal to 100% of the FAV of a
Securities Trust Share on the calculation date less an amount in respect of the
termination fees payable by the Company to Martin Currie under the Management
Agreement will be used.

It is intended that New Lowland Shares will be issued by Lowland at a premium of
1.5% to the prevailing net asset value of Lowland Shares at the calculation date
(having taken into account accrued but undeclared income). Henderson will
contribute towards the costs of the Proposals a sum equal to 0.4% of the value
of funds transferred to Lowland as a result of the Proposals. This sum will be
used to pay to Securities Trust an amount equal to that amount of the
termination fee that Securities Trust is liable to pay to Martin Currie under
the terms of its Management Agreement on the value of the funds of Securities
Trust which transfer to Lowland. Any remaining amount will be applied  first to
discharge any excess costs incurred by Lowland not otherwise covered by the
contribution that the Company has agreed to make towards Lowland's costs, and
thereafter, for the benefit of those Shareholders who elect for New Lowland
Shares. New Lowland Shares which are issued under these proposals will not rank
for the Lowland dividend payable in June 2005.

Shareholders not making a valid election for the purposes of the Proposals will
be deemed to have elected to receive New Securities Trust Shares. Overseas
Shareholders will receive cash.

Information on New Securities Trust

New Securities Trust will be the Company's successor and will have a similar
investment objective and dividend policy.

New Securities Trust's investment objective will be to achieve rising income and
long-term capital growth through a balanced portfolio of investments in the
United Kingdom. The emphasis will be on companies with the potential for strong
earnings and dividend growth. Its dividend policy will be to achieve real
dividend growth over the medium term.

New Securities Trust Shares will be listed on the Official List and traded on
the London Stock Exchange. The capital of New Securities Trust will comprise
ordinary shares and bank borrowings. The ratio of total assets invested in
equities to net assets will not exceed 115%. The ratio of cash to net assets
will not exceed 15%. Initially, it is anticipated that 90% of total assets will
be invested in equities at an average yield relative of 115% of that of the FTSE
All-Share Index and 10% of total assets will be invested in fixed interest
securities - split roughly equally between preference shares and gilts - and
cash. The benchmark will be the FTSE All-Share Index.

New Securities Trust will be managed by Ross Watson and Tom Maxwell of Martin
Currie. The basic investment management fee will be 0.4% per annum of total
assets, payable quarterly in arrears, and it is anticipated that proposals for
the introduction of a performance fee may be considered by its board at a later
date.

It is proposed that the directors of New Securities Trust will be Neil Donaldson
(Chairman), Charles Berry, Anita Frew, Andrew Irvine and Edward Murray.

The board of New Securities Trust will seek to maintain a narrow discount for
New Securities Trust Shares. It is therefore intended that New Securities Trust
will adopt a discount protection mechanism and will seek to utilise share
buyback powers to maintain any share price discount to NAV per share in single
digits in percentage terms. It is intended that the discount protection
mechanism will provide New Securities Trust Shareholders with the opportunity to
have their shares repurchased by the Company if the average discount exceeds
7.5% in the three months prior to each year-end.

New Securities Trust will have an unlimited life.

Information on Lowland

Lowland is a UK investment trust, established in 1960, which aims to give its
shareholders a higher than average income return with growth of both capital and
income over the medium to long term. Lowland's investment policy is to invest in
a broad spread of different sized UK companies with not more than half by value
coming from the largest 100 UK companies and the balance from small and medium
sized companies. Lowland is managed by Henderson Global Investors Limited.

James Henderson has managed the Lowland portfolio since 1990. Lowland's
investment philosophy is based on buying shares in companies when the valuation
is low and selling when the future growth prospects are adequately reflected in
the share price. Dividend yield, price to book ratio and share price to turnover
are all tools used to assess the valuation of a company held within the
portfolio.

Lowland has a simple equity capital structure comprising ordinary shares.
Lowland Shares are listed on the Official List and traded on the London Stock
Exchange. As at 1 March 2005, Lowland Shares were geared by a £6 million
(nominal) 11.25% debenture stock maturing in 2010 and £34 million drawn down
under term loan facilities. Lowland's current gearing level is 26.3% of net
assets; as part of its investment policy, Lowland is restricted to a maximum
gearing level of 29% of total assets. As at 1 March 2005, Lowland had a market
capitalisation of £155.6 million and net assets of £150.9 million.

Lowland has an excellent performance record relative to its benchmark (the FTSE
All-Share Index) and its peer group (the UK Growth and Income sector) over
various periods, as shown in the table below:

Net asset value total return to 1 March 2005
                                               1 year               3 years               5 years
Lowland                                         25.0%                 53.5%                102.5%
FTSE All-Share Index                            14.6%                 11.0%                 -4.8%
Peer Group                                      16.1%                 11.5%                 17.9%

(Source: Datastream)



The closing price of 729.5p per Lowland Share as at 1 March 2005 represented a
premium of 3.1% to the net asset value of 707.6p per Lowland Share as at that
date. Lowland Shares have traded at an average premium of 0.2% over the twelve
months ended 1 March 2005, which compares with the UK Income and Growth sector
size-weighted average discount of 8.8% over the same period.

Lowland has pursued a progressive dividend policy and has grown its dividend at
an annualised compound rate of 5.2% per annum over the past five years  which
compares to 3.7% for PIGIT (source: AITC; as at 28 February 2005).

Lowland has an unlimited life.

Information relating to Lowland's investment manager

Henderson, which is authorised and regulated by the Financial Services
Authority, is a leading investment management company, providing a wide range of
investment products and services to institutions and individuals in Asia, Europe
and North America. Henderson manages assets of over £68.4 billion (as at 30 June
2004) and employs around 900 people worldwide.

Henderson is one of the UK's leading investment trust managers with £3.4 billion
of investment trust assets under management (as at 31 December 2004). Henderson
Global Investors Limited and its associated companies and BNP Paribas Fund
Services UK Ltd provide investment management, accounting, secretarial,
administrative and custody services to Lowland for an annual management fee of
0.5% of the average of the aggregate net chargeable assets as defined in the
management agreement.

Costs and expenses

Both the Company and Lowland will bear their own costs arising out of the
Board's Proposals, save that the Company has agreed to contribute up to £250,000
in respect of Lowland's costs should the Proposals succeed and up to £75,000
should the Proposals fail to be implemented. The total costs to the Company of
the Board's Proposals, before taking account of any costs associated with the
realisation of the Company's assets and excluding any termination payment due by
the Company under the Management Agreement, are expected to amount to
approximately £14.3 million (including VAT and including £11.9 million in
respect of repaying the debenture) which will be deducted from the net assets of
the Company when calculating the FAV. The total costs to the Company of the
PIGIT Offer amount to some £17.3 million.

General

The directors of Securities Trust are responsible for the information contained
in this announcement, save that the sole responsibility accepted by the
directors of Securities Trust in respect of the information relating to PIGIT
has been to ensure that it has been correctly compiled from published sources
and is fairly reproduced and presented. Subject as aforesaid, to the best of the
knowledge and belief of the directors of Securities Trust (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
directors of Securities Trust accept responsibility accordingly.


Appendix I


Definitions

 
Board or Directors     the directors of the Company from time to time  
                                                                       
Henderson              Henderson Global Investors Limited              
                                                                       
JPMorgan Cazenove      JPMorgan Cazenove Limited                       
                                                                       
London Stock Exchange  London Stock Exchange plc                       
                                                                       
Lowland                Lowland Investment Company plc                  
                                                                       
Lowland Shares         ordinary shares of 25p each in the capital of   
                       Lowland                                         
                                                                       
Lowland Shareholders   holders of Lowland Shares                       
                                                                       
Management Agreement   the management agreement between Securities     
                       Trust and Martin Currie dated 20, 22, and 23 May
                       1997 as amended by a supplementary management   
                       agreement between Securities Trust and Martin   
                       Currie dated 18, 19, and 20 May 1998 and by an  
                       agreement between Securities Trust and Martin   
                       Currie dated 10 and 11 November 2004            
                                                                       
Martin Currie          Martin Currie Investment Management Limited     
                                                                       
New Lowland Shares     new ordinary shares of 25p each in the capital  
                       of Lowland to be issued under the Proposals                                                    
                                                                       
New Lowland            holders of New Lowland Shares                   
Shareholders                                                           
                                                                       
New Securities Trust   a new investment trust to be managed by Martin  
                       Currie, which will be established as a successor
                       vehicle to the Company under the Proposals      
                                                                       
New Securities Trust   shares in New Securities Trust                  
Shares                                                                 
                                                                       
New Securities Trust   holders of New Securities Trust Shares          
Shareholders                                                           
                                                                       
Offer Document         the offer document issued by Intelli Corporate  
                       Finance Limited on behalf of PIGIT on 10 March  
                       2005                                            
                                                                       
Official List          the Official List of the UK Listing Authority   
                                                                       
PIGIT                  Perpetual Income and Growth Investment Trust plc
                                                                       
PIGIT Offer or Offer   the formal offer made by Intelli Corporate      
                       Finance Limited on behalf of PIGIT on 10 March  
                       2005 for the entire issued and to be issued     
                       share capital of the                            
Company                                                                
                                                                       
PIGIT Shares           ordinary shares of 10p each in the capital of   
                       PIGIT                                           
                                                                       
Proposals              the Board's proposals as described in the       
                       circular dispatched to Shareholders dated 23    
                       March 2005                                      
                                                                       
Securities Trust or    Securities Trust of Scotland plc                
Company                                                                
                                                                       
Securities Trust       ordinary shares of 25p each in Securities Trust 
Shares                                                                 
                                                                       
Shareholders           holders of Securities Trust Shares              
                                                                       
US or the United       the United States of America, its territories   
States                 and possessions, any state of the United States 
                       of America and the District of Columbia and all 
                       other areas subject to the jurisdiction of the  
                       United States of America                        
                                                                       
UK or the United       United Kingdom of Great Britain and Northern    
Kingdom                Ireland                                         
                                                                       
UK Listing Authority   the Financial Services Authority acting in its  
                       capacity as the competent authority for the     
                       purposes of Part VI of the Financial Services   
                       and Markets Act 2000                            
                                                                       




Appendix II

Principal sources, bases of information and assumptions



Unless otherwise stated, the sources and bases of calculation of certain data in
this announcement and the assumptions made for the purposes of such calculations 
are as follows:



(a)        Unless otherwise indicated, information relating to net asset value
total returns, share price total returns, and FTSE All-Share Index total returns
has been taken from Datastream and assumes gross dividends are reinvested on the
ex dividend date.



(b)        Unless otherwise indicated, net asset values or NAVs have been taken
from Datastream. For the purposes of calculating entitlements under the Board's
Proposals, net asset values have been calculated valuing all debt at par.



(c)        Unless otherwise indicated, share prices have been taken from
Datastream. The 'discount' or 'premium' at which a share trades is the
difference between its mid market price and its net asset value expressed as a
percentage of that net asset value. Where the share price is higher than the net
asset value per share, the share stands at a premium; if the share price is
lower than the net asset value per share, the share stands at a discount.



(d)               For the calculation of the Company's formula asset value under
the Proposals, the net asset value of the Company will be adjusted by the
following:



(i)                  it is assumed that the £50,000,000 in nominal value of
6.25% debenture stock 2031 is repaid in accordance with its terms at a cost to
the Company of £11.9 million, rather than on a negotiated basis at a reduced
figure. The Company is exploring its available options to reduce this cost;



(ii)                the aggregate costs of the Proposals borne by the Company
amount to £2.4m inclusive of VAT, excluding the cost of repaying the debenture
stock referred to above, and including a cost of £300,000 that it is expected
New Securities Trust will pay to its sponsor;



(iii)               no account has been taken of the costs that will be incurred
by the Company in reorganising its portfolio and realising its investments in
connection with the Proposals;



(iv)              the Company has agreed to contribute up to £250,000 towards
Lowland's costs should the Proposals proceed (this is included within the £2.4m
aggregate costs estimate referred to above); and



(v)                the Company intends to pay dividends amounting to 4.7p per
Securities Trust Share prior to the implementation of the Board's Proposals. It
is anticipated that 2.0p of this will be paid out of revenue reserves as a
special dividend. No adjustment has been made in respect of this in the FAV
calculation.



(e)        For the calculation of the attributable net asset value for the
election for New Securities Trust Shares under the Proposals, such a number of 
New Securities Trust Shares will be issued for each Securities Trust Share which 
shall have a value equal to 100% of the FAV of each Securities Trust Share under 
the Proposals.



(f)         For the calculation of the attributable net asset value for the cash
election under the Proposals, an estimated amount of 0.33p per Securities Trust
Share electing for cash is subtracted from the FAV in respect of the termination
fee. Cash electors will be entitled to 100% of the resulting amount.



(g)        For the calculation of the attributable net asset value for the
election for New Lowland Shares under the Proposals, an estimated amount of
0.33p per Securities Trust Share electing for Lowland is subtracted from the FAV
in respect of the termination fee. An amount will then be added in respect of
Henderson's contribution to the costs of the Proposals which is 0.4% of the
value of funds transferred to Lowland. New Lowland Shares will be issued at a
1.5% premium to their adjusted net asset value (including accrued but undeclared
net income) on implementation of the Proposals.



(h)        For the calculation of the attributable market value for the election
for New Lowland Shares under the Proposals, the attributable net asset value of
the election is increased by the premium on Lowland Shares, which at 8 March
2005, was 3.6%. The 3.6% premium is calculated using the closing middle market
price of 734.50p per Lowland Share (as per the London Stock Exchange Daily
Official List) and the NAV of 709p per Lowland Share as published by Lowland on
9 March 2005.



(i)         The FAV of the Company under the PIGIT Offer is sourced from page 13
of the PIGIT Offer Document.



(j)         The attributable net asset value in pence per Securities Trust Share
for an election for PIGIT Shares under the PIGIT Offer is calculated by taking
99.25% of the FAV of Securities Trust Shares under the PIGIT Offer (as disclosed
on page 13 of the Offer Document). This is then increased by the 0.5p per
Securities Trust Share special dividend, the payment of which PIGIT would
procure to Shareholders under the Offer.



(k)        For the calculation of the attributable market value of the election
for PIGIT Shares under the PIGIT Offer, the attributable net asset value is
reduced by the 0.5p per Securities Trust Share special dividend, the payment of
which PIGIT would procure to Shareholders under the Offer. The resulting amount
is then decreased by the PIGIT Share discount, which at 8 March 2005, was 2.7%.
This is then increased by the 0.5p per Securities Trust Share special dividend,
the payment of which PIGIT would procure to Shareholders under the Offer. The
2.7% discount is calculated using the closing middle market price of 191.75p per
PIGIT Share (as per the London Stock Exchange Daily Official List) and the NAV
of 197.09p per PIGIT Share (diluted, debt at par) as published by PIGIT on 9
March 2005.



(l)         The attributable net asset value for the partial election for cash
under the PIGIT Offer is calculated by taking 97% of the FAV of Securities Trust
Shares under the PIGIT cash offer (as disclosed on page 14 of the Offer
Document). This is then increased by the 0.5p per Securities Trust Share special
dividend, the payment of which PIGIT would procure to Shareholders under the
Offer.



(m)       The growth in inflation is based on the increase in the retail prices
index (all items) as reported by Datastream.



END






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