Acquisition

RNS Number:8517P
Chepstow Racecourse PLC
17 September 2003


                                                Wednesday, 17th September 2003

                          THE CHEPSTOW RACECOURSE PLC

                        'The Capital Racecourse of Wales'
                                        
Proposed #34.1m acquisition of Northern Racing Limited


The Chepstow Racecourse PLC ("the Company" or "Chepstow"), the AIM listed
operator of 'The Capital Racecourse of Wales', is pleased to announce today the
proposed acquisition of Northern Racing Limited ("Northern"), one of the three
leading racecourse operators in the UK.

Highlights:

  * Acquisition of Northern through the simultaneous acquisition of both St.
    Modwen Properties PLC's ("St. Modwen") and Sir Stanley Clarke's
    shareholdings, satisfied by the allotment of new Chepstow shares
  * Following the acquisition, Chepstow's existing Ordinary Shares will
    represent 22.5% of the Enlarged Share Capital; Sir Stanley Clarke's and St.
    Modwen's interests will be approximately 57.1% and 27.2%, respectively
  * Enlarged Group's market capitalisation at last night's closing Chepstow
    share price of 125 pence per share is #44.0m
  * Logical extension of Chepstow's close working relationship with Northern
    over recent years as a result of Sir Stanley Clarke's common interest
  * The Enlarged Group will own and manage 9 racecourses and will be one of
    the UK's top 3 racecourse operators; the portfolio will include:
       -    Bath, Brighton, Chepstow, Fontwell Park, Great Yarmouth, Hereford,
            Newcastle, Sedgefield and Uttoxeter
  * The three largest shareholders in the Enlarged Group, Sir Stanley
    Clarke, St. Modwen and The Merchant Navy Officers' Pension Fund, have agreed
    to certain 12 month "lock-in" arrangements
  * Subject to the achievement of envisaged synergies, the acquisition is
    expected to be earnings enhancing (before goodwill amortisation and
    exceptional items) in its first full financial year*
  * The Enlarged Group will retain Chepstow's corporate name, its existing
    registered office in Wales, and will continue to host its AGM at Chepstow
    Racecourse
  * Chepstow interim results have been announced separately today
  * Intention to increase total dividends per share in the current year by 10%
  * The transaction is conditional upon approval by the shareholders of both
    St. Modwen and Chepstow, at EGMs on 6 October 2003 and 10 October 2003
    respectively; irrevocable undertakings have been received to vote in favour
    of all the Resolutions to be put to the EGM by both the Independent
    Directors and the Company's largest institutional shareholder

*This statement should not be interpreted as meaning that the future adjusted
earnings per share of the Enlarged Group will necessarily match or exceed the
historic published earnings per share of Chepstow

Peter Grodzinski and John Deer, the Independent Non-Executive Directors,
commenting on the acquisition said:

"Chepstow's close working relationship with Northern over recent years, in part
as a result of Sir Stanley Clarke's common interest, has had a positive and
material impact on Chepstow's financial performance.

"The Independent Directors believe that Chepstow's combination with the Northern
Group, one of the leading UK racecourse operators, will significantly enhance
its commercial position, reduce its risk exposure and better enable it to take
advantage of the opportunities that the possible changes to the UK horseracing
industry may present."

For further information please contact:

The Chepstow Racecourse PLC                      www.chepstow-racecourse.co.uk
Peter Grodzinski and John Deer                                    01291 622260
The Independent Non-Executive Directors

Northern Racing Limited                               www.northernracing.co.uk

Sir Stanley Clarke, Chairman                         On the day: 020 7067 0700
Simon Clarke, Deputy Chairman                          Thereafter:01283 711733
Rod Street, Managing Director
Mark Stokes, Finance Director

NM Rothschild & Sons Limited
David Forbes/Greg Cant/David Dodds                               0161 827 3800

Weber Shandwick Square Mile
Reg Hoare/Katie Hunt                                             020 7067 0700

 An analyst meeting will be held today at 11.15am for 11.30am at the offices of
 Weber Shandwick Square Mile, Fox Court, 14 Gray's Inn Road, London, WC1X 8WS.

 Print resolution images are available for the media to view and download from
                               www.vismedia.co.uk


Introduction

The Board announced today that the Company has agreed, subject to certain
conditions, to acquire Northern Racing Limited.

The Northern Group is one of the three leading racecourse operators in the UK.
Northern is privately owned, with SCLL owning approximately 64.94 per cent. of
its equity and St. Modwen owning approximately 35.06 per cent. SCLL is wholly
owned by Sir Stanley Clarke, who is also the Chairman and a significant
shareholder of St.Modwen, as well as being the Executive Chairman and a
significant shareholder of Chepstow, and the Chairman of Northern.

Chepstow's close working relationship with Northern over recent years, in part
as a result of Sir Stanley Clarke's common interest, has had a positive and
material impact on Chepstow's financial performance. The Independent Directors
believe that the acquisition of Northern should ensure that Chepstow will be
better positioned to respond to future changes affecting the UK horseracing
industry, enable Chepstow and Northern to realise further synergies, and allow
Chepstow shareholders to share in the growth potential of the Northern Group.

The proposed acquisition of Northern will be achieved by Chepstow acquiring,
from Sir Stanley Clarke, the entire issued share capital of SCLL and, from St.
Modwen, its entire interest in Northern's share capital. These two acquisitions
will be simultaneous and interconditional. The acquisition by Chepstow of St.
Modwen's interest in Northern is also subject to the approval of St. Modwen's
shareholders (excluding Sir Stanley Clarke who, as a related party, will not
vote on this matter).

The consideration for the Acquisitions will be wholly satisfied by the allotment
of 27,308,272 new Ordinary Shares to the Vendors. The Consideration Shares will
represent 77.5 per cent. of the Enlarged Share Capital. Based on the closing mid
market price of Chepstow shares on 16 September 2003, this values the
Consideration Shares at #34.1million and the Enlarged Share Capital at #44.0
million.

Following the Acquisitions, the Existing Ordinary Shares will represent 22.5 per
cent. of the Enlarged Share Capital. This proportion was negotiated following a
review of the two companies' recent historical and projected financial
information and reflects Chepstow's development prospects and the opportunity
for the Enlarged Group to benefit from the relatively stronger growth prospects
of Northern.

Sir Stanley Clarke's interest in the Enlarged Group will be approximately 57.06
per cent. and St. Modwen's interest will be approximately 27.17 per cent.

The acquisition of Northern constitutes a change of control of the Company under
the City Code, a reverse takeover and related party transaction under the AIM
Rules, and a substantial property transaction under section 320 of the Act and,
as such, requires the prior approval of Shareholders. Such classification is as
a result of Sir Stanley Clarke being a vendor as well as a Director of Company,
the size of Northern relative to Chepstow and the size of the shareholdings of
members of the Concert Party in the Company assuming implementation of the
Proposals. An Extraordinary General Meeting has been convened for 10 October
2003 to consider and, if thought fit, approve the Resolutions. Assuming the
prior approval of St. Modwen shareholders to the terms of the Acquisition
Agreement, if Resolutions 1, 2, 3 and 5 are duly passed at the EGM, the Company
is expected to apply for the Enlarged Share Capital to be admitted to AIM
immediately thereafter, on 13 October 2003. If Shareholder approval is not given
for the Acquisitions, trading is expected to continue in the Existing Share
Capital without interruption.

In view of Sir Stanley Clarke's interests in, and both his and Stephen Jones'
positions on the boards of, Chepstow and Northern, a committee of Independent
Directors comprising John Deer, Peter Grodzinski and Paul Twamley was formed
earlier this year in order to consider and, as appropriate, negotiate the terms
of the Acquisitions.

Current Developments in the UK Horseracing Industry

A number of developments are creating a period of significant uncertainty in the
UK horseracing industry and may have an impact on both Chepstow and Northern. A
summary of these developments is provided below and their relevance to the
Enlarged Group is addressed in the ''Background to and Reasons for the
Acquisitions'' section below.

OFT Review of Horseracing Regulation

In April 2003 the OFT issued to the BHB and the Jockey Club its preliminary
decision that certain rules and orders of those bodies are in breach of the
Competition Act on the grounds that they:

  * limit the freedom of racecourses to organise their racing, in particular
    by fixing how often and at what times they stage races and the type of
    racing they stage;

  * set the minimum amounts of prize money that racecourses must offer
    owners to enter their horses in a race; and

  * monopolise the supply of race and runners' data to bookmakers by
    foreclosing competition from alternative suppliers.

The BHB and the Jockey Club responded to the OFT's preliminary decision on 5
September 2003. Once the OFT has considered these representations from the BHB
and the Jockey Club, it will issue its final decision, though it has not
indicated any timetable for so doing. The Directors and Proposed Directors do
not expect the OFT to issue its final decision until 2004. In the event the OFT
requires any changes to be implemented, the Directors and Proposed Directors
would not expect the impact to be felt for some time after that due to practical
considerations.

OFT Review of the Attheraces Agreement

In November 2001 the OFT received a notification for clearance of, or exemption
under the Competition Act for, an agreement signed in July 2001 between the RCA,
Attheraces and others. Under this agreement several UK racecourse operators,
including Chepstow and the Northern Group, receive significant income. For the
year ended 31 December 2002 the Northern Group's turnover included #1.4 million
and Chepstow's turnover included #0.3 million derived from this agreement.

In April 2003 the OFT issued to the parties to the agreement its preliminary
decision and in August 2003 issued a supplemental to that preliminary decision.
The preliminary and supplemental decisions are that the agreement constitutes
joint selling by the racecourses and is in breach of the Competition Act. The
Directors and Proposed Directors do not expect the OFT to issue its final
decision on this matter until 2004, though the OFT has not indicated any
timetable for so doing.

In the opinion of the Directors and Proposed Directors the OFT's decision could
result in the renegotiation of the agreement which could lead to a reduced
contract value and some variation in the allocation between the racecourse
operators. Alternatively, the agreement could be terminated, in which case a
liability on the racecourses to repay certain sums might arise. It is also
possible that the OFT could leave the agreement unchanged.

Other Industry Developments

In 2000 the UK Government announced its intention to end its direct involvement
in the administration and financing of the horseracing industry, thereby
enabling the horseracing industry to take responsibility for its own affairs and
finances. Implementation of this intention will have a significant effect on the
Tote and the Levy Board. All racecourse owners derive an important source of
revenue from the Tote and the Levy Board.

The Government plans to reform UK gambling, including horserace betting and
bookmaking. Draft legislation in the form of the Gambling Bill (Cmnd. 5878) was
published on 15 July 2003. If enacted in its current form, the Tote could become
licensed by the proposed Gambling Commission to undertake its activities. In the
Government's announcement in 2000, it was envisaged that the Tote would be sold
to a consortium of racing interests and that conditions would be attached to any
licence granted to it by the Gambling Commission. The Directors and Proposed
Directors understand that Parliamentary time in 2003/2004 will be made available
to implement the Government's proposals concerning the Tote.

The Government announcement in 2000 envisaged the abolition of the Levy Board,
which was to take effect in September 2003 but is now to be in September 2005.
The Levy Board provides revenues to horserace courses raised through a tax
principally on bookmakers' gross profits from off-course British horserace
betting. No proposals to replace this source of revenue have yet been published
either by the Government or those bodies that are directly affected, namely the
Levy Board and the BHB.

At present, racecourses can elect to convert a proportion of their annual Levy
Board funding to capital credits which can be used to fund capital expenditure
programmes approved by the Levy Board. Capital credits are currently not treated
as taxable income. It is unclear whether the tax benefits of the current capital
credits scheme will continue after the Levy Board is abolished.

The Levy Board has disclosed a foreseen shortfall in the levy raised for 2003
and has consequently announced a reduction in payments to be made until the end
of this year in the Levy Board's contribution to the prize monies paid by
racecourse operators this year. The reduction is 14 per cent. of the originally
planned contribution of #43.9 million. The Directors and Proposed Directors
believe that the shortfall in funds for Chepstow and Northern will be offset by
offering reduced prize money. The Levy Board has announced a planned
contribution to the UK's 59 racecourses in respect of prize money for 2004 of
#48 million.

In September 2003 the Jockey Club introduced new rules designed to improve the
integrity of horseracing by restricting jockeys' use of mobile phones during
race meetings. A number of jockeys voiced their opposition to these new rules
and the matter has received considerable publicity. A number of protests
followed, the most prominent of which led to the cancellation of a Sandown Park
race meeting on 14 September 2003. Whilst future developments are uncertain, the
Directors and the Proposed Directors believe that this dispute is likely to be
resolved in the short term and that there will not be any material impact on the
Enlarged Group.

Background to and Reasons for the Acquisitions

Despite the significant uncertainties in the UK horseracing industry, the
Independent Directors believe that the ultimate outcome of the various reviews
and developments will be increased commercial flexibility for racecourse
operators and increased choice for their principal customers - namely racehorse
owners, trainers, racegoers and bookmakers. However, the Independent Directors
do recognise that a relatively small operator such as Chepstow faces some risks
from these uncertainties.

Accordingly the Independent Directors believe that Chepstow's combination with
the Northern Group, one of the leading UK racecourse operators, will
significantly enhance its commercial position, reduce its risk exposure and
better enable it to take advantage of the opportunities that the possible
changes to the UK horseracing industry may present. In particular:

  * Media/Sponsorship Income Synergies: Revenues from Attheraces, BAGS and
    sponsorship represent a significant proportion of Chepstow's income.
    Chepstow enjoys a close working relationship with Northern and currently
    benefits from joint negotiations with Northern in respect of Attheraces,
    BAGS and sponsorship. The Independent Directors believe these benefits to be
    material and are mindful that no certainty exists regarding the continuation
    of this affiliation in the future. The combination with Northern should help
    preserve these current benefits and enhance Chepstow's position in respect
    of future negotiations.

  * Levy Board Funding: The Levy Board, which administers the tax on
    bookmakers' gross profits from off-course British horserace betting, is to
    be abolished by the UK Government in September 2005. Chepstow, along with
    all other UK racecourses, benefits from significant financial support from
    the Levy Board, which principally funds race day prize money as well as
    approved capital expenditure programmes through interest-free loans.
    Although, following the abolition of the Levy Board, the Independent
    Directors still expect the UK racecourse industry to receive an equivalent
    form of funding, they believe that Chepstow will be in a more secure
    position to safeguard such funding as part of a larger group.

  * OFT Review: The review of certain rules and orders of the BHB and the
    Jockey Club may, in the opinion of the Independent Directors, result in
    horse racecourse owners having a greater ability to compete with each other
    through flexibility in fixtures, prize money and the commercialisation of
    race and runners' data. If so, the Enlarged Group should be better placed to
    move fixtures around between its courses and so optimise earnings as well as
    reduce the chance of abandonments. In addition, the Enlarged Group should be
    better placed to take advantage of new opportunities to manage additional
    fixtures. Furthermore, if opportunities arise to exploit racecourse data,
    the Enlarged Group should, in view of its size, be better placed in any
    resultant negotiations.

The Independent Directors are confident that, irrespective of the Aquisitions,
Chepstow has attractive growth prospects over the medium term as a result of
recent and current capital expenditure programmes. In the longer term, the
Independent Directors believe that the rate of organic growth could reduce as
Chepstow's business approaches maturity. With the wider portfolio of racecourses
available to the Enlarged Group, the Independent Directors believe that its
commercial prospects will be enhanced for the following reasons:

  * as the Northern Group is one of the three largest UK racecourse
    operators, the Enlarged Group should have improved leverage to negotiate
    media and other income deals;

  * Northern has an established track record of acquiring racecourses and
    improving their financial performance by applying its commercial, financial
    and marketing expertise. The further commercial development of recently
    acquired racecourses such as Bath, Fontwell Park, Sedgefield and Great
    Yarmouth is expected to contribute significantly to growth in the Enlarged
    Group;

  * the Enlarged Group has the opportunity to grow organically over the
    longer term as Northern, in particular, develops its principal revenue
    lines, including admissions, sponsorship, hospitality and events, across its
    racecourses. The Enlarged Group's scale and regional coverage should assist
    the development of corporate initiatives in these areas;

  * with the benefit of Chepstow's quotation on AIM, which offers wider
    funding options, the Enlarged Group will be well placed to lead future
    industry consolidation and build on Northern's acquisition experience;

  * the Enlarged Group will benefit from Northern's experienced management
    team, including dedicated management teams for all major revenue drivers
    such as media, sponsorship, hospitality and events, as well as its
    racecourse management teams. Through Northern, the Enlarged Group will also
    be well represented on industry focus groups looking at the wide ranging
    industry reviews and developments;

  * the Enlarged Group is expected to realise additional income from
    property development opportunities around certain of Northern's racecourses,
    such as the sale of parcels of surplus land for residential development. At
    Newcastle, Northern has opportunities to develop its golf course and club
    house, extend its golf driving range facilities and establish 5-a-side
    football pitches, subject to obtaining necessary planning consents; and

  * Northern is exploring the development of an all weather racing circuit
    at Sedgefield, where significant progress has been made with its planning
    application. Discussions are ongoing with the BHB regarding the additional
    fixtures that would be needed to support the Sedgefield investment. An all
    weather circuit should help reduce the number of abandonments and the
    additional fixtures should generate further BAGS income and other race day
    income for the Enlarged Group.

The Independent Directors believe that there are a number of other benefits
which will accrue from the acquisition of Northern, as follows:

  * Synergies: Further benefits are expected through greater fixture
    allocation flexibility, purchasing economies and overhead savings.

  * Share liquidity: The Independent Directors believe that there has been a
    change in focus within the investment community away from smaller public
    companies which has resulted in reduced liquidity of shares in such
    companies, a trend that has affected Chepstow. The larger capital base of
    the Enlarged Group following the implementation of the Proposals may, in the
    opinion of the Independent Directors, assist in improving liquidity in the
    Company's shares in the medium term.

  * Risk diversification: Chepstow currently has a single racecourse and
    accordingly its success depends on the performance of this one course.
    Uncontrollable factors such as the weather, status of transport
    infrastructure and extraordinary events like the foot and mouth outbreak can
    all have a material impact on the financial performance of the business.
    Furthermore, Chepstow's jump fixtures are held between October and April
    when weather can be more problematic. The larger portfolio of courses
    available to the Enlarged Group would, in the opinion of the Independent
    Directors, assist in mitigating this risk.

The Independent Directors expect that, subject to the achievement of envisaged
synergies, the Acquisitions will enhance earnings per share, before goodwill
amortisation and exceptional items, in the first full financial year, being the
year ending 31 December 2004.

The foregoing statement should not be interpreted as meaning that the future
adjusted earnings per share of the Enlarged Group will necessarily match or
exceed the historic published earnings per share of Chepstow. The earnings per
share calculations reflect the same normalised full corporation tax charge for
Chepstow and the Enlarged Group. Historically, Chepstow has enjoyed a low
corporation tax charge due in part to a significant proportion of its Levy Board
funding having been converted to capital credits. It is unclear whether this
taxation benefit will continue following the abolition of the Levy Board.

Information on Chepstow

The Company operates Chepstow racecourse which, for 2003, is scheduled to stage
25 days of fixtures, including jump and flat race meetings. It hosts a number of
prestigious jump meetings such as the Welsh National and the Tote Silver Trophy.
It also seeks to use its facilities for other commercial activities such as
corporate hospitality, conferences, meetings, events, exhibitions and venue
hire.

Chepstow racecourse has benefited from significant capital expenditure in recent
years. The new Paddock, Tattersalls turnstiles entrance, Weighing Room and
Owners' & Trainers' Bar have been operational since May 2002. The extension of
the Members' Stand was completed in April 2003 at a cost of approximately #2.0
million. Work is currently underway on the construction of a new restaurant,
bar, 8 corporate hospitality boxes and two hospitality suites for the Members'
Stand.

For the year ended 31 December 2002, Chepstow reported a profit before taxation
of #654,709 (2001: #371,010) on turnover of #3,353,619 (2001: #2,502,836). As at
31 December 2002, Chepstow had net assets of #4,226,010 (2001: #3,677,186).

For the six months ended 30 June 2003, Chepstow reported a profit before
taxation of #339,000 (2002: #207,000) on a turnover of #1,407,000 (2002:
#1,098,000). As at 30 June 2003, Chepstow had net assets of #4,565,000 (2002:
#3,871,000). Chepstow's 2003 unaudited interim results have been separately
announced today.

Information on Northern

The Northern Group is one of the UK's leading racecourse operators and owns
eight out of the 59 UK racecourses: Bath, Brighton, Fontwell Park, Great
Yarmouth, Hereford, Newcastle, Sedgefield and Uttoxeter. It is scheduled to
stage 167 days of flat and jump fixtures in 2003, representing approximately 13
per cent. of the UK's scheduled fixtures.

The geographic profile of Northern's courses is a key business strength and
gives it the ability to offer customers a wide range of opportunities through
individual, regional and national initiatives. Each of its eight courses,
although specialising in flat and jump horseracing, offers other commercial and
leisure activities. It has a strong focus on customer service, the provision of
a common product offering across its courses and the development of innovative
marketing strategies.

Acquisition History

Sir Stanley Clarke first invested in the racecourse portfolio currently owned by
the Northern Group when he invested, through SCLL, in Uttoxeter Racecourse in
1992. Northern was incorporated in 1994 and has subsequently grown both
organically and by acquisition.

Northern has an established track record of acquiring racecourses and improving
their financial performance by applying its commercial, financial and marketing
expertise. In particular, the further commercial development of recently
acquired racecourses such as Bath, Fontwell Park, Sedgefield and Great Yarmouth
is expected to drive future growth. This will require significant capital
expenditure of approximately #3 million over 2004 and 2005, which is expected to
be substantially funded by existing facilities and interest-free Levy Board
loans, most of which are already committed.

Financial Summary

For the year ended 31 December 2002, Northern reported a profit before taxation
of #2,500,000 (2001: #1,740,000) on turnover of #18,114,000 (2001: #10,003,000).
As at 31 December 2002, Northern had net assets of #15,835,000 (2001:
#14,227,000).

Unaudited turnover for the seven months to 31 July 2003 is approximately #13.2
million, which is ahead of budget. Turnover on a like-for-like basis, which
excludes Fontwell Park racecourse which was acquired in August 2002, is also
ahead of the corresponding period last year.

Northern's management expect trading for the full year to be in line with their
expectations. Improvements in trading have predominantly resulted from increased
attendance levels at most of the Northern Group's racecourses, reflecting both
operational improvements and the continuing recovery from the effects of the
foot and mouth crisis.

The Levy Board has disclosed a foreseen shortfall in the levy raised for 2003
and has consequently announced a reduction in payments to be made until the end
of this year in the Levy Board's contribution to the prize monies paid by
racecourse operators this year. The reduction is approximately 14 per cent. of
the originally planned contribution of #43.9 million. Northern will offset the
shortfall in funds it is to receive from the Levy Board by an equal reduction in
the amount of prize monies it will pay out and, accordingly, no impact on
trading in 2003 is anticipated. In common with several other courses, the
Northern Group's Sedgefield racecourse was recently the subject of a protest by
owners and trainers in connection with industry wide prize money reductions. One
race at this meeting was subject to a number of withdrawals. Notwithstanding the
protests, unaudited management accounts for Sedgefield indicate that profits for
this race meeting were ahead of budget. The Levy Board has announced a planned
contribution to the UK's 59 racecourses in respect of prize money for 2004 of
#48 million.

Material adjustments have been made to the audited financial statements of the
Northern Group to align the accounting policy of the Northern Group in respect
of capital credits with that of the Company. The Levy Board operates a capital
credit scheme whereby income grants can be waived in favour of a transfer, at
the discretion of the Levy Board, to capital credits. Such capital credits may
be claimed, at the Levy Board's discretion, against expenditure on an approved
capital project or repayment of Levy Board loans. Under the Northern Group
accounting policy, capital credits are taken to a grant account when received
and released to profit and loss account by equal annual instalments over the
period over which the relevant assets, funded by such capital credits, are
depreciated. As the receipt of capital credits is derived from and dependent
upon trading activities, the Company takes capital credits to the profit and
loss account when initially made available and recoverable against either the
repayment of loans or expenditure on approved capital projects. Going forward,
the New Board of the Enlarged Group will continue to adopt the accounting policy
of the Company.

The Northern Group's key sources of income are:

Media Income

The Northern Group has sold certain media rights in relation to the races hosted
at its courses (except the rights to transmit live coverage of these races to
licensed betting offices, which are covered by the BAGS agreement, and the
exclusive rights in relation to races at the Sedgefield course, which are
covered by the GG-Media agreement) to Attheraces in a ten year contract
effective from 1 July 2001. Further details of the Attheraces and GG-Media
agreements are set out in the ''Glossary'' section of this announcement.

The Bookmaking Industry

The bookmaking industry is a major source of income through two principal
channels:

   * Levy Board payments; and
   * BAGS.

BAGS pays a flat fee to racecourse owning companies of #4,000 per race held at
each of their racecourses. A typical race meeting has between 6 and 8 races. The
number of race meetings per day in the United Kingdom in respect of which BAGS
is obliged to transmit live coverage is limited to a certain number which varies
according to the day of the week. If the number of meetings on a certain day
exceeds that number, BAGS is not obliged to transmit coverage or pay a fee in
respect of the excess number of races. BAGS is also not obliged to pay any fee
in respect of races which are broadcast on terrestrial television.

Admissions

Each Northern Group racecourse works to a detailed marketing plan for every race
meeting. A key aim is to attract advance bookings as race meetings can be
sensitive to adverse weather conditions.

In addition, corporate boxes are available at Bath, Brighton, Fontwell Park,
Hereford, Newcastle, Sedgefield and Uttoxeter racecourses. These boxes are hired
out to corporate clients on either one or three year contracts, with payment
being received in advance. A small number of corporate boxes are retained and
made available for daily hire at individual race meetings for corporate
customers who do not wish to attend race meetings on a frequent basis.

Sponsorship

Sponsorship has two main elements: advertising hoardings and race sponsorship.
The Northern Group has historically achieved higher levels of race sponsorship
than the industry as a whole. Sponsors include the Northern Group's suppliers,
the horseracing industry and general/strategic sponsors.

Event & Venue Hire

The size, location and diversity of the racecourse facilities are marketed to
attract a wide range of bookings - including conferences, shows, exhibitions and
private functions. In 2003, cumulatively, the Northern Group's courses are
scheduled to race on only 167 days of a potential 2,920. Accordingly EVH offers
good growth opportunities at all eight racecourses and is a fast growing profit
centre for the Northern Group. All catering services are outsourced.

Directors, Senior Management and Employees

Northern has a strong management team with extensive experience of the
horseracing, leisure and property development industries, enabling the Northern
Group to drive both organic and acquisitive growth. Furthermore, this management
strength enables the Northern Group to dedicate senior management resource to
influencing the horseracing industry, alongside preparing for the changes that
may result from the current wide-ranging industry reviews.

Property Portfolio Management

As a consequence of it owning eight racecourses, the Northern Group has
significant real estate assets and, as at 31 December 2002, freehold and
leasehold assets had a net book value of #38.4 million. The Northern board has
considerable property development expertise and the Northern Group is currently
pursuing a number of opportunities (including making planning applications) for
the selective development and sale of certain assets.

Information on SCLL

SCLL is a holding company which is wholly owned by Sir Stanley Clarke. SCLL has
historically provided loans to fund Northern. Sir Stanley Clarke holds his 64.94
per cent. interest in Northern through SCLL.

In the future it is intended that there will continue to be no trading activity
in SCLL. At Completion, SCLL's balance sheet will comprise its investment in
Northern, together with a loan of approximately #1.1 million owed to Sir Stanley
Clarke and an identical debtor owed to SCLL by Northern. The loan from Sir
Stanley Clarke will not be repayable by SCLL or interest bearing until 31
December 2005.

All other loans owed to Sir Stanley Clarke by SCLL, which amounted to
approximately #5,113,300 as at 14 September 2003, have been capitalised by the
issue to Sir Stanley Clarke of 5,113,300 ordinary shares of #1.00 in the capital
of SCLL in discharge of such loans. Those shares will be transferred to Chepstow
pursuant to the Acquisition Agreement. Under the Acquisition Agreement, Chepstow
has received appropriate indemnities to ensure that no actual liabilities or
contingent pre-Completion liabilities will be assumed in connection with SCLL.

Information on St. Modwen

St. Modwen is a UK property development company whose shares are listed on the
Official List. Sir Stanley Clarke is Executive Chairman of St. Modwen and is
interested in 28.26 per cent. of its issued share capital. For the year ended 30
November 2002, St. Modwen's profit before taxation was #30.0 million (2001:
#25.5 million) on turnover of #108.2 million (2001: #66.0 million), with
earnings per share of 17.1p (2001: 15.2p) and dividends per share of 5.7p (2001:
4.9p). As at 30 November 2002, St. Modwen had net assets and net debt of #194.3
million and #173.8 million, respectively.

St. Modwen has held its 35.06 per cent. interest in Northern since 18 August
1994, having previously been involved with Uttoxeter racecourse since 1988. St.
Modwen has provided financial and managerial support to Northern since acquiring
its interest, including assistance with seeking planning consents, project
management advice, and design and build expertise with larger capital projects.
All such assistance is provided on arm's length terms, except for the provision
of non-interest bearing loans which amounted to approximately #0.6 million as at
31 December 2002. These loans will not be repayable or interest bearing until 31
December 2005.

Following Completion, St. Modwen will hold 9,573,412 Ordinary Shares in
Chepstow, representing 27.17 per cent. of the Enlarged Share Capital. Pursuant
to the Acquisition Agreement, St. Modwen has agreed not to dispose of the
Consideration Shares issued to it for a period of one year from Completion save
in certain circumstances.

Board

On Completion, the Proposed Directors will join the board of Chepstow, Stephen
Jones will become a Non-Executive Director of Chepstow and retire as Company
Secretary and Mark Stokes will be appointed as Company Secretary. In addition,
John Deer will retire from the Chepstow board and Peter Grodzinski will step
down from the Chepstow board and join the board of Chepstow's subsidiary,
Chepstow Races Limited. The New Board will comprise:

Sir Stanley Clarke CBE, DL, Hon.D.Univ, aged 70, Executive Chairman

Sir Stanley Clarke is also Chairman of St. Modwen and Northern. He is a member
of the Jockey Club and a Director of the RCA. He is a racehorse owner and, with
Lord Gyllene, owned the winner of the 1997 Grand National.

Stephen Jones, aged 42, Non-Executive Director

Stephen Jones was appointed a Director of the Company in 1989 and is also a
Non-Executive Director of Northern. He is a member of the RCA's Media Rights
Advisory Group and its Legal Group. He was formerly an employee of Rothschild,
leaving in 1996, and now provides consultancy services to Rothschild.

Simon Clarke, aged 38, Executive Director

Simon Clarke joined Northern in 1997 as an Executive Director at Brighton
Racecourse. In 1998 he became an Executive Director of High Gosforth Park
Limited and was appointed Managing Director in 2000. Simon joined the board of
Northern in 2000 and was promoted to Deputy Chairman in 2001. He is also
Director and the Vice-Chairman of the RCA. His father is Sir Stanley Clarke.

Rod Street, aged 37, Executive Director

Rod Street joined Northern in 1994 as the Assistant Commercial Manager at
Uttoxeter Racecourse, progressing to General Manager. He was appointed to the
board of Northern in 2000, as Managing Director of Uttoxeter, Bath and Brighton
racecourses and became Group Managing Director in 2001. He is a former director
of Chepstow.

Mark Stokes BA, FCA, aged 38, Executive Director

Mark Stokes is a Chartered Accountant who joined Northern in March 2001 as the
Northern Group's Finance Director.

Paul James Twamley, aged 57, Non-Executive Director
He is currently Chairman of Harris Pye Group Limited, First Motorway Services
Limited, Cardiff Broadcasting Company Limited (trading as Red Dragon Radio) and
Elinia Limited. He is also Chairman of Hamsard One Thousand and Sixty Nine
Limited (trading as Ribbons).

Jane Gerard-Pearse BSc (Hons), MBA, aged 40, Non-Executive Director

Jane Gerard-Pearse is a Non-Executive Director of Northern. She joined Northern
in 1992 and successfully managed Uttoxeter Racecourse during a period of
expansion. Her father is Sir Stanley Clarke.

Anthony Glossop MA, aged 62, Non-Executive Director

Anthony Glossop is a Non-Executive Director of Northern. He is also Deputy
Chairman and Chief Executive of St. Modwen.

Piers Pottinger, aged 49, Non-Executive Director

Piers Pottinger is a Non-Executive Director of Northern.

Graham Stow FCIB, FCIPD, aged 59, Non-Executive Director

Graham Stow is a Non-Executive Director of Northern.

Each of Sir Stanley Clarke, Mark Stokes, Rod Street and Simon Clarke will enter
into a new service agreement with the Company on Completion. The service
agreements may be terminated on 6 months' notice. Sir Stanley Clarke will be
entitled to a basic salary of up to #50,000 per annum for his services as
Executive Chairman, which salary he does not intend to draw for the foreseeable
future. The basic salaries of Mark Stokes and Simon Clarke are #85,000 per
annum. Rod Street will receive #100,000 per annum. In addition, they are
entitled to benefits including a Company car/car allowance, private medical
insurance for themselves, their spouses and children, a bonus and a Company
pension.

Jane Gerard-Pearse, Anthony Glossop, Piers Pottinger and Graham Stow will enter
into non-executive letters of appointment with the Company upon Completion. Paul
Twamley and Stephen Jones will also enter into non-executive letters of
appointment with the Company on the same terms with effect from Completion. The
letters of appointment are terminable on three months' notice.

Employees

The New Board has confirmed that following the Acquisitions, horseracing will
continue at Chepstow and the existing employment rights, including pension
rights, of all the employees of the Enlarged Group will be fully safeguarded.

The City Code

The acquisition of Northern gives rise to certain considerations under the City
Code due to the fact that the Consideration Shares to be issued to members of
the Concert Party represent 77.5 per cent. of the Enlarged Share Capital (to
which voting rights attach) on Admission.

The Panel has determined that Sir Stanley Clarke, St. Modwen, James Leavesley,
Simon Clarke and Jane Gerard-Pearse should be regarded as acting in concert for
the purposes of Rule 9.

On Completion, members of the Concert Party will hold 29,731,952 Ordinary Shares
in aggregate, representing approximately 84.38 per cent. of the Enlarged Share
Capital. Accordingly, the issue of the Consideration Shares to members of the
Concert Party would normally give rise to an obligation on the Concert Party to
make a general offer to the Shareholders under Rule 9. The Panel has agreed,
however, subject to the passing on a poll by the Independent Shareholders of
Resolution 5, to waive the obligation of the Concert Party to make a general
offer to Shareholders under Rule 9, which would otherwise arise upon the issue
of the Consideration Shares to members of the Concert Party.

No member of the Concert Party or persons acting in concert with any member of
the Concert Party will participate in the poll by Independent Shareholders on
Resolution 5.

As Stephen Jones and Rod Street hold Ordinary Shares and are directors of
Northern, they are not considered by the Panel to be Independent Shareholders
and therefore will not participate in the poll by the Independent Shareholders
on Resolution 5.

Related Party Considerations

In view of the size of Northern relative to Chepstow and Sir Stanley Clarke's
position as a director and shareholder in the Company, Northern, SCLL and 
St.Modwen, the Acquisitions are deemed ''Related Party Transactions'' under the
AIM Rules. In accordance with the AIM Rules, the Independent Directors, having
consulted with Rothschild, consider the terms of the Acquisitions to be fair and
reasonable insofar as Shareholders are concerned. In providing advice to the
Independent Directors, Rothschild has taken into account the commercial
assessments of the Independent Directors.

As Sir Stanley Clarke is connected with the Company, the Acquisitions are also
required to be approved by Shareholders in accordance with section 320 of the
Act.

Lock-in arrangements

The Vendors and Chepstow's largest institutional shareholder, The Merchant Navy
Officers' Pension Fund, have all agreed that they will not, save in certain
limited circumstances, for a period of twelve months from the date of Admission,
dispose of any Ordinary Shares or, in the case of the Vendors, any of the
Consideration Shares.

Retention of listing

Sir Stanley Clarke and St. Modwen have undertaken (except in certain
circumstances) to use their reasonable endeavours to procure that the Company's
listing on AIM is not cancelled for a period of five years from Completion and
to exercise their voting rights as shareholders in the Company to give effect to
this obligation.

Dividend policy

The New Board intends, subject to the availability of distributable profits, to
pay a total dividend for the year ending 31 December 2003 of 1.21 pence per
Ordinary Share, which represents a 10 per cent. increase over the 2002 dividend
of 1.1 pence per Ordinary Share. The New Board intends to follow a progressive
dividend policy, subject to the working capital requirements of the Enlarged
Group and the implementation of the Company's on-going investment policies.

Constitutional matters

It is the New Board's intention, for the immediate future, to retain Chepstow's
corporate name and existing registered office and to continue to host general
meetings at Chepstow racecourse.

Extraordinary General Meeting

An extraordinary general meeting of the Company is to be held at 11.00 a.m. on
10 October 2003 to approve the following Resolutions:

1. to approve the Acquisitions;
2. to increase the authorised share capital of the Company to #25,000,000 by the
   creation of an additional 89,500,000 Ordinary Shares;
3. to authorise the directors of the Company to allot relevant securities
   (including the Consideration Shares) pursuant to section 80 of the Act up to an
   aggregate nominal amount of #9,763,441. Such authority substitutes the authority
   conferred on the directors at the annual general meeting of the Company held on
   16 April 2003 and takes account of the Enlarged Share Capital;
4. to approve the Share Option Schemes;
5. to approve the Waiver. This Resolution will be taken by a poll of the
   Independent Shareholders;
6. to adopt new articles of association; and
7. to empower the directors of the Company to allot equity securities for cash
   pursuant to the general authority conferred on them under section 80 of the Act
   as if section 89(1) of the Act does not apply to the allotment, provided that
   this power is limited to the allotment of equity securities (i) in connection
   with a rights issue where those equity securities are proportionate (as nearly
   as may be) to the ordinary shareholdings and (ii) otherwise up to an aggregate
   nominal amount of #440,456. Such authority substitutes the authority conferred
   on the directors at the annual general meeting of the Company held on 16 April
   2003 and takes account of the Enlarged Share Capital.

The Acquisitions are conditional, inter alia, on the passing of Resolutions 1,
2, 3 and 5 above.

Irrevocable Undertakings

The Independent Directors have given irrevocable undertakings to vote in favour
of the Resolutions in respect of their aggregate beneficial holdings of 617,280
Existing Ordinary Shares, representing approximately 7.79 per cent. of the
Existing Share Capital.

In addition, the Company has received an irrevocable undertaking in respect of
1,111,376 Existing Ordinary Shares (representing approximately 14.02 per cent.
of the Existing Share Capital) from The Merchant Navy Officers' Pension Fund to
vote in respect of its entire beneficial holding in favour of the Resolutions
necessary to implement the Acquisitions.

Sir Stanley Clarke has also irrevocably undertaken to vote in favour of
Resolutions 1, 2, 3, 4, 6 and 7 in respect of his entire beneficial holding of
2,372,240 Existing Ordinary Shares, representing approximately 29.92 per cent.
of the Existing Share Capital. Each of Simon Clarke, Stephen Jones and Rod
Street has given a similar irrevocable undertaking to vote in respect of their
aggregate beneficial holdings of 93,040 Existing Ordinary Shares representing
approximately 1.17 per cent. of the Existing Share Capital. As none of Sir
Stanley Clarke, Simon Clarke, Stephen Jones or Rod Street are considered by the
Panel to be independent, they cannot vote on Resolution 5.

Recommendation

The Independent Directors, who have been so advised by Rothschild, believe that
the Acquisitions are in the best interests of the Company and its Shareholders
as a whole. In providing advice to the Independent Directors, Rothschild has
taken into account the Independent Directors' commercial assessments of the
Acquisitions.

Accordingly, the Independent Directors are unanimously recommending Shareholders
to vote in favour of Resolutions 1, 2, 3, 4, 6 and 7, as they have irrevocably
undertaken to do in respect of their own shareholdings, amounting to 617,280
Existing Ordinary Shares (representing approximately 7.79 per cent. of the
Existing Share Capital).

In addition, the Independent Directors, who have been so advised by Rothschild,
believe that the Waiver is in the best interests of the Company and its
Independent Shareholders. In providing advice to the Independent Directors,
Rothschild has taken into account the Independent Directors' commercial
assessments.

Accordingly, the Independent Directors are unanimously recommending the
Independent Shareholders to vote in favour of Resolution 5, as they have
irrevocably undertaken to do in respect of their own shareholdings, amounting to
617,280 Existing Ordinary Shares (representing approximately 11.39 per cent. of
the Existing Share Capital held by the Independent Shareholders). Sir Stanley
Clarke, Simon Clarke, Rod Street, Stephen Jones and James Leavesley, who are
interested in 2,510,560 Ordinary Shares in aggregate, cannot vote on Resolution 5.

                                        
                                    - Ends -


For further information please contact:

The Chepstow Racecourse PLC                      www.chepstow-racecourse.co.uk
Peter Grodzinski and John Deer                                    01291 622260
The Independent Non-Executive Directors

Northern Racing Limited                               www.northernracing.co.uk
Sir Stanley Clarke, Chairman                          On the day: 0207067 0700
Simon Clarke, Deputy Chairman                          Thereafter:01283 711733
Rod Street, Managing Director
Mark Stokes, Finance Director

NM Rothschild & Sons Limited
David Forbes/Greg Cant/David Dodds                               0161 827 3800

Weber Shandwick Square Mile
Reg Hoare/Katie Hunt                                             020 7067 0700

  An analyst meeting will be held today at 9.45 for 10.00am at the offices of
 Weber Shandwick Square Mile, Fox Court, 14 Gray's Inn Road, London, WC1X 8WS.

 Print resolution images are available for the media to view and download from
                               www.vismedia.co.uk

                                   APPENDIX 1

                                    GLOSSARY

''Attheraces'' 
Attheraces PLC is a company owned by 4 Ventures Limited, Sky
Ventures Limited and Arena Leisure Plc.

''Attheraces Agreement'' 
With effect from 1 July 2001, Attheraces entered into
an agreement with Attheraces Holdings Limited, the RCA and 49 of the UK's 59
racecourses (including Chepstow and the Northern Group's Bath, Brighton,
Fontwell Park, Great Yarmouth, Hereford, Newcastle and Uttoxeter racecourses) in
relation to the broadcasting and related media rights of horseracing events
taking place at those racecourses. Under the agreement, Attheraces has the
exclusive right to distribute its recordings worldwide (subject to certain
exceptions, including rights already covered by specific agreements entered into
by the RCA for the televising of UK horseraces overseas and media rights which
have been granted to BAGS, as described below) by various media including video,
television, radio, the internet and mobile technology. The agreement, which is
worth #307 million in aggregate to the 49 racecourses over 10 years, was
negotiated on their behalf by the RCA.

The agreement will, subject to earlier termination in accordance with its terms,
continue for an initial period of 5 years. If certain performance targets are
met by Attheraces during that initial period, the agreement will be renewed
automatically for a further 5 year period. If those targets have not been met,
the RCA may (on behalf of the 49 racecourses) terminate the agreement at the end
of the initial 5 year period or renew the agreement for the further 5 year
period.

''BAGS'' 
The Bookmakers' Afternoon Greyhound Services is the term used to
describe the agreements between UK bookmakers and UK course operators for the
supply of pictures of live greyhound races and/or horseraces which are broadcast
to licensed betting offices in the UK.

''BHB'' The British Horseracing Board has four members: the Jockey Club; The
Racecourse Association Limited; The Racehorse Owners Association Limited; and
The Industry Committee (Horseracing) Limited (representing trainers, jockeys,
stable lads and others).

The BHB's main responsibilities include: strategic planning of, and formulating
policy for, British horseracing; representing the interests of British
horseracing to bookmakers; the collection and control of funds required for the
administration of horseracing; central marketing and promotion of British
horseracing; controlling the Fixture List; race planning; and encouraging the
breeding of bloodstock.

''Fixture List'' 
The fixture list is set by the BHB and governs when racecourses
in the UK can hold race meetings.

''GG-Media'' 
GG Media Limited is an English company owned by the Fleming Family
and Partners (the London-based investment bank), Lord Hesketh's family and
associates and members of its board and management, formed to promote and
maximise the value of certain media interests in certain UK independent
racecourses.

Sedgefield Steeplechase Company (1927) Limited, a member of the Northern Group,
has entered into an agreement with GG-Media and Satellite Information Services
Limited in relation to the broadcasting of events from Sedgefield racecourse and
associated media rights for a 5 year term from 1 May 2002.

''Jockey Club'' 
The Jockey Club was founded in 1752 and, until 1993, was solely
responsible for the governance and regulation of horseracing in Great Britain.
In 1993 the Jockey Club decided to transfer certain functions to a new body, the
BHB (described above).

The Jockey Club is responsible for registering and licensing horses,
racecourses, owners, trainers and jockeys. A requirement of licensing and
registration is that racing participants abide by the Orders and Rules of
Racing. The Jockey Club is also responsible for the conduct of racing, including
safeguarding the integrity of racing.

Through the Racecourse Holdings Trust, the Jockey Club also owns 13 UK
racecourses, being Aintree, Carlisle, Cheltenham, Epsom Downs, Haydock Park,
Huntingdon, Kempton Park, Market Rasen, Newmarket, Nottingham, Sandown Park,
Warwick and Wincanton.

''Levy Board'' 
The Horserace Betting Levy Board is a statutory body created by
the Betting, Gaming and Lotteries Act 1963. The Levy Board is responsible for
the collection of a levy on off-course horserace betting turnover from
bookmakers and the Tote. The funds collected are applied to three purposes: the
improvement of horseracing, the improvement of breeds of horses and the
advancement or encouragement of veterinary science or veterinary education.

The Levy Board is an important contributor to the finances of the UK horseracing
industry. Approximately 90 per cent. of annual levy income is applied to the
improvement of horseracing. This includes funding the annual Fixture List
through the provision of prize money, appearance money, fixture incentives and
abandonment payments. A variety of other schemes relating to horseracing's
strategic development and operation are also supported.

In addition, the Levy Board has a separate Capital Fund, from which
interest-free loans are made to racecourses to develop and improve their
facilities.

The UK Government has announced that the Levy Board will be abolished in
September 2005.

''OFT'' 
The Office of Fair Trading, which is currently investigating certain
aspects of the UK horseracing industry.

''Orders and Rules of Racing'' The Orders and Rules of Racing are administered
by the Jockey Club and the BHB and govern the organisation and management of UK
horseracing.

''RCA'' 
The Racecourse Association Limited is a company limited by guarantee
which acts as the trade organisation representing the 59 racecourses in the UK.
The RCA is funded by annual contributions from its members.

''Tote'' T
he Horserace Totalisator Board, a statutory board governed by the
Betting, Gaming and Lotteries Act 1963, offers pool betting on UK horseraces. It
operates at all UK racecourses and from approximately 435 off-course betting
outlets.

The Tote takes pool bets, both on and off-courses, on win, place, exacta,
jackpot, placepot and the Tote Scoop 6. The Tote takes deductions from these
pools to cover costs and to fund the Tote's contribution to racing and the
remainder is paid out to successful betting customers. The Tote's overall
contribution to UK horseracing was #10.7 million in 2002.


                                   APPENDIX 2

                                  DEFINITIONS

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

''Acquisition Agreement'' 
the conditional agreement between Sir Stanley Clarke,
St. Modwen and Chepstow dated 17 September 2003, relating to the proposed
acquisition by Chepstow of the entire issued share capital of SCLL and all the
shares in Northern held by St. Modwen.

''Acquisitions'' 
the proposed acquisition by the Company of the entire issued
share capital of SCLL from Sir Stanley Clarke and of all the shares in Northern
held by St. Modwen, pursuant to the Acquisition Agreement.

''Act'' 
the Companies Act 1985, as amended.

''Admission'' 
the admission of the Consideration Shares and the readmission of
the Existing Ordinary Shares to trading on AIM becoming effective in accordance
with the AIM Rules.

''AIM'' 
the Alternative Investment Market of the London Stock Exchange.

''AIM Rules'' 
the rules published by the London Stock Exchange governing
admission to and the operation of AIM.

''Chepstow'' or ''Company'' 
The Chepstow Racecourse PLC.

''City Code'' 
The City Code on Takeovers and Mergers.

''Completion'' 
the date on which the Acquisition Agreement becomes unconditional
and is completed in accordance with its terms.

''Concert Party'' 
Sir Stanley Clarke, St. Modwen, James Leavesley, Simon Clarke
and Jane Gerard-Pearse, being persons acting in concert as
defined in the City Code.

''Consideration Shares'' 
the 27,308,272 new Ordinary Shares to be issued,
credited as fully paid, to the Vendors on Completion.

''EGM'' or ''Extraordinary the extraordinary general meeting of the Company
convened for General Meeting" 
11.00 a.m. on 10 October 2003, or any adjournment thereof.

''Enlarged Group'' 
the Company and its subsidiary undertakings following Completion.

''Enlarged Share Capital'' 
the Existing Share Capital as enlarged by the issue
of the Consideration Shares following Completion.

''EVH'' 
the Northern Group's event and venue hire activities.

''Existing Directors'' or ''Directors'' or ''Board'' 
the existing directors of Chepstow at the date of this announcement, being Sir 
Stanley William Clarke, Stephen Rhys Jones, Daniel John Deer, Peter Gregory Grodzinski 
and Paul James Twamley

''Existing Ordinary Shares'' 
the Ordinary Shares in issue at the date of this announcement.

''Existing Share Capital'' 
the issued share capital of the Company at the date of this announcement.

''Group'' 
Chepstow and its subsidiary at the date of this announcement.

''Independent Directors'' 
those of the existing directors of Chepstow who are
independent of the Concert Party and of Northern, namely John Deer, Peter
Grodzinski and Paul Twamley.

''Independent Shareholders'' 
Shareholders who are not members of the Concert
Party, other than Stephen Jones and Rod Street.

''London Stock Exchange'' 
London Stock Exchange plc.

''New Board'' 
the proposed board of Chepstow following implementation of the
Proposals, comprising each of the Proposed Directors, Sir Stanley Clarke,
Stephen Jones and Paul Twamley.

''Northern'' 
Northern Racing Limited.

''Northern Group'' 
Northern and its subsidiaries at the date of this announcement.

''Official List'' 
the official list of the UKLA.

''Ordinary Shares'' 
ordinary shares of 25p each in the capital of the Company.

''Panel'' 
The Panel on Takeovers and Mergers.

''POS Regulations'' The Public Offers of Securities Regulations 1995, as
amended.

''Proposals'' 
the Acquisitions and the Waiver.

''Proposed Directors'' 
Simon William Clarke, Rodney Grant Street, Mark Bryan
Stokes, Jane Louise Gerard-Pearse, Charles Compton Anthony Glossop, Piers Julian
Dominic Pottinger and Graham Harold Stow.

''Resolutions'' 
the resolutions to be proposed at the EGM, as set out in the
notice of the EGM.

''Rothschild'' 
N M Rothschild & Sons Limited.

''SCLL'' 
Stanley Clarke Leisure Limited.

''Shareholders'' 
holders of Existing Ordinary Shares.

''St. Modwen'' 
St. Modwen Properties PLC.

''UK'' 
the United Kingdom.

''UKLA'' or ''United Kingdom Listing Authority'' 
the Financial Services Authority acting in its capacity as the competent authority 
for the purposes of the Financial Services and Markets Act 2000.

''Vendors'' 
Sir Stanley Clarke and St. Modwen.

''Waiver'' 
the waiver by the Panel of any obligation on the Concert Party that
would otherwise arise to make a mandatory cash offer for the Existing Ordinary
Shares under Rule 9 of the City Code.





                      This information is provided by RNS
            The company news service from the London Stock Exchange

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