Disposal

Whitbread PLC
03 June 2007



3 June 2007



                                  WHITBREAD PLC


                          Sale of David Lloyd Leisure



Whitbread PLC is pleased to announce that it has conditionally agreed to sell
David Lloyd Leisure to Versailles Bidco Limited, a company owned by London &
Regional Holdings Limited and Bank of Scotland Corporate, for £925 million.



Transaction Highlights


* Agreement to sell DLL for an aggregate cash consideration, on a debt and cash
free basis, of £925 million


* Sale price represents a multiple of 13.4x historic EBITDA (based on DLL EBITDA
for the year to 1 March 2007 of £68.8 million)


* Completion is expected to occur on 2 August 2007



Use of Proceeds


Whitbread will initially use the proceeds from the Sale to pay down debt.
Subsequently, in the absence of any further value creating opportunities and
based on current investment plans, Whitbread will move to the level of leverage
outlined in its preliminary results announcement on 24th April 2007.  This will
be achieved through returning any excess cash to Whitbread's shareholders net of
any further payments made into the Company's pension fund.



Commenting on the sale, Alan Parker, CEO of Whitbread said:


'Following the success of the management action taken in DLL over the last
eighteen months and a review of the health club market, we have decided that
this sale represents excellent value for our shareholders.  Whitbread is now
well placed to deliver the ambitious growth plans for its hotels, restaurants
and coffee shops.'


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


For further information contact:



Whitbread investor relations
Christopher Rogers, Group Finance Director
                                                          0207 353 4200
Tulchan Communications
Andrew Grant/Celia Gordon Shute


Morgan Stanley (Financial Advisor)
Brian Magnus, Managing Director                           0207 425 5000




Morgan Stanley & Co. Limited is acting exclusively for Whitbread and no one else
in connection with the Sale (as defined in the full announcement attached
hereto) and will not be responsible to anyone other than Whitbread for providing
the protections afforded to clients of Morgan Stanley & Co. Limited nor for
providing advice in relation to the Sale, the contents of this document or any
transaction or arrangement referred to in this announcement.


This announcement is for information purposes only and does not constitute an
offer or invitation to acquire or dispose of any securities or investment advice
in any jurisdiction.


This announcement contains a number of forward-looking statements relating to
Whitbread (as defined in the full announcement attached hereto), its
subsidiaries and its subsidiary undertakings (the 'Whitbread Group') with
respect to, amongst others, the following: financial condition of the Whitbread
Group; economic conditions in which the Whitbread Group operates; the business
of the Whitbread Group; and future benefits of the Sale.  Whitbread considers
any statements that are not historical facts to be 'forward-looking statements'.
They relate to events and trends that are subject to risks and uncertainties
that could cause the actual results and financial position of the Whitbread
Group to differ materially from the information presented in the relevant
forward-looking statement.  When used in this announcement the words 'estimate',
'project', 'intend', 'aim', 'anticipate', 'believe', 'expect', 'should' and
similar expressions, as they relate to the Whitbread Group or the management of
it, are intended to identify such forward-looking statements.  Readers are
cautioned not to place undue reliance on these forward-looking statements which
speak only as at the date of this announcement.  Neither Whitbread nor any
member of the Whitbread Group undertake any obligation publicly to update or
revise any of the forward-looking statements, whether as a result of new
information, future events or otherwise, save in respect of any requirement
under applicable laws and regulations.



Introduction


Whitbread ('Whitbread' or the 'Company') is pleased to announce that it has
today entered into a conditional agreement (the 'Sale Agreement') to sell David
Lloyd Leisure Limited, together with certain related assets ('DLL' or 'David
Lloyd Leisure'), to Versailles Bidco Limited ('Versailles'), a company owned by
London & Regional Holdings Limited and Bank of Scotland Corporate, for an
aggregate cash consideration, on a debt and cash free basis, of £925 million
(the 'Sale').



Information on DLL


As at 1 March 2007, David Lloyd Leisure operated 60 clubs in the UK and Ireland
(including 45 tennis centres), seven in the Netherlands, one in Spain and one in
Belgium, with more than 370,000 members.


David Lloyd Leisure also owns the rights to the David Lloyd Leisure name and
brand in those countries in which David Lloyd Leisure operates.


For the year ended 1 March 2007, David Lloyd Leisure generated an operating
profit of £37.1 million (£46.4 million pre exceptionals) on turnover of £237.3
million.  As at 1 March 2007, David Lloyd Leisure had net operating assets of
£523.4 million and gross assets of £568.0 million.



Background to and Reasons for the Sale


In the autumn of 2005, Whitbread changed the management at DLL and started a two
year recovery programme.   At that time, a number of approaches for DLL were
received but it was decided that shareholders' interests would be best served by
improving the operating performance of the business prior to any consideration
being given to DLL's place within Whitbread.   Since that time, the new
management team has made significant progress as evidenced by increased
membership, margin improvements and a series of new initiatives to promote club
usage out of peak hours.


The Board has completed a thorough review of the DLL business in light of the
progress made in performance improvement, current and forecast trends in the
health club market and approaches received.  As a result, it has been decided
that it is in shareholders interests to crystallize value which has been
materially increased as a result of the recovery programme over the last 18
months.  This will also enable Whitbread to concentrate the resources of the
Company on its ambitious growth plans for its hotels, restaurants and coffee
shops.



Principal Terms and Conditions of the Sale


Under the terms of the Sale Agreement, which was signed with Versailles on 3rd
June 2007 (the 'Sale Agreement'), Whitbread Group PLC has agreed to sell the
shares in David Lloyd Leisure Limited, together with certain related assets, to
Versailles for an aggregate cash consideration, on a debt and cash free basis,
of £925 million. The price is subject to a net debt completion adjustment.
However, most of the net debt is owed to the Whitbread Group and will be repaid
to the Whitbread Group at Completion.  The Sale is structured as a direct sale
of the entire issued share capital of David Lloyd Leisure Limited, David Lloyd
Leisure Espana I S.L. and David Lloyd Leisure Espana II S.L, together with those
shares of DLL S.A. which are registered in the name of Whitbread Group PLC.  In
addition, a property located in Bromsgrove in the United Kingdom and registered
in the name of Whitbread Group PLC is being sold under the Sale Agreement.



In view of the size of the businesses of DLL, L&R and Bank of Scotland
Corporate, the Sale Agreement is conditional upon an appropriate competition
clearance being obtained from the European Commission.  Completion of the Sale
('Completion') will take place following such clearance being obtained.
Whitbread expects that this condition will be fulfilled prior to 2 August, 2007
which is the expected date for Completion.


Under the Sale Agreement, Whitbread Group PLC has given certain warranties and
undertakings to Versailles which are usual for a transaction of this nature.
In the event that the date of Completion changes, an announcement will be made
on a Regulatory Information Service.



Use of Proceeds


Whitbread will initially use the proceeds from the Sale to pay down debt.
Subsequently, in the absence of any further value creating opportunities and
based on current investment plans, Whitbread will move to the level of leverage
outlined in its preliminary results announcement on 24th April 2007.  This will
be achieved through returning any excess cash to Whitbread's shareholders net of
any further payments made into the Company's pension fund



Effects of the Sale


The cash proceeds from the Sale will amount to £925 million on a cash and debt
free basis, subject to certain post completion adjustments.  As noted above,
Whitbread will initially use the proceeds from the sale of David Lloyd Leisure
to pay down debt.  On this basis, the Sale is expected to be broadly earnings
neutral in the current financial year.



Contacts

Whitbread investor relations
Christopher Rogers, Group Finance Director
                                                          0207 353 4200
Tulchan Communications
Andrew Grant/Celia Gordon Shute


Morgan Stanley (Financial Advisor)
Brian Magnus, Managing Director                           0207 425 5000



Morgan Stanley & Co. Limited is acting exclusively for Whitbread and no one else
in connection with the Sale and will not be responsible to anyone other than
Whitbread for providing the protections afforded to clients of Morgan Stanley &
Co. Limited nor for providing advice in relation to the Sale, the contents of
this document or any transaction or arrangement referred to in this
announcement.


This announcement is for information purposes only and does not constitute an
offer or invitation to acquire or dispose of any securities or investment advice
in any jurisdiction.


This announcement contains a number of forward-looking statements relating to
Whitbread and its subsidiary undertakings (the 'Whitbread Group') with respect
to, amongst others, the following: financial condition of the Whitbread Group;
economic conditions in which the Whitbread Group operates; the business of the
Whitbread Group; and future benefits of the Disposal.  Whitbread considers any
statements that are not historical facts to be 'forward-looking statements'.
They relate to events and trends that are subject to risks and uncertainties
that could cause the actual results and financial position of the Whitbread
Group to differ materially from the information presented in the relevant
forward-looking statement.  When used in this document the words 'estimate', '
project', 'intend', 'aim', 'anticipate', 'believe', 'expect', 'should' and
similar expressions, as they relate to the Whitbread Group or the management of
it, are intended to identify such forward-looking statements.  Readers are
cautioned not to place undue reliance on these forward-looking statements which
speak only as at the date of this announcement.  Neither Whitbread nor any
member of the Whitbread Group undertake any obligation publicly to update or
revise any of the forward-looking statements, whether as a result of new
information, future events or otherwise, save in respect of any requirement
under applicable laws, the Listing Rules and other regulations.



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