Waterford Wedgwood plc Recommended Cash Offer for Royal Doulton plc


DUBLIN, Ireland, Dec. 15, 2004 (PRIMEZONE) -- Waterford Wedgwood plc:

Summary



  *    Waterford Wedgwood plc ("Waterford Wedgwood") announces the
       terms of a recommended cash offer to be made by or on behalf
       of Waterford Wedgwood U.K. plc ("Waterford Wedgwood UK"), a
       subsidiary of Waterford Wedgwood, for the entire issued and
       to be issued ordinary share capital of Royal Doulton plc
       ("Royal Doulton") under which Royal Doulton Shareholders
       will be offered 12p in cash for each Royal Doulton Share
       (the "Offer").

  *    The Offer values the whole of the issued share capital of
       Royal Doulton at approximately GBP 39.9 million (EUR 57.8
       million).

  *    The Offer represents a premium of approximately 43 per cent.
       to the closing middle-market price of 8.38 pence per Royal
       Doulton Share on 20 October 2004 (the day before Waterford
       Wedgwood and Royal Doulton announced they were in talks
       regarding a potential offer for Royal Doulton).

  *    The Waterford Wedgwood Group currently holds 70,339,352
       Royal Doulton Shares representing approximately 21.16 per
       cent. of Royal Doulton's issued share capital. These Royal
       Doulton Shares will not be the subject of the Offer.

  *    Waterford Wedgwood UK has received irrevocable undertakings
       to accept (or procure acceptances of) the Offer from:

       (i)                             the directors of Royal
                                       Doulton in respect of their
                                       aggregate holdings of
                                       7,214,235 Royal Doulton
                                       Shares, representing
                                       approximately 2 per cent. of
                                       Royal Doulton's issued share
                                       capital and, in respect of,
                                       in aggregate, 5,000,000
                                       Royal Doulton Options and
                                       such of the 4,900,000 Royal
                                       Doulton Shares subject to
                                       LTIP awards which are
                                       acquired by the Royal
                                       Doulton Directors pursuant
                                       to vesting of such awards;
                                       and,

       (ii)                            Sir Anthony O'Reilly,
                                       Chairman of Waterford
                                       Wedgwood (through Indexia
                                       Holdings Limited, a company
                                       which he wholly controls)
                                       and Mr Peter John
                                       Goulandris, Deputy Chairman
                                       of Waterford Wedgwood
                                       (through Cantique Holdings
                                       Limited, a company which he
                                       wholly controls) in respect
                                       of their aggregate holdings
                                       of 13,250,000 Royal Doulton
                                       Shares, representing
                                       approximately 4 per cent. of
                                       Royal Doulton's issued share
                                       capital.

  *    The Waterford Wedgwood Group therefore owns, or Waterford
       Wedgwood UK has received irrevocable undertakings to accept
       the Offer in respect of, a total of 90,803,587 Royal Doulton
       Shares, representing approximately 27 per cent. of Royal
       Doulton's issued share capital.

  *    In view of its size, the Offer is conditional, inter alia,
       on Waterford Wedgwood shareholder approval.

Commenting on the Offer, Sir Anthony O'Reilly, Chairman of Waterford Wedgwood, said:

"We are pleased to formalise this offer first outlined to our shareholders in October. As I said at the time, this acquisition would transform Waterford Wedgwood. The benefits are immediately apparent. We can add Royal Doulton's revenues to our own revenues without greatly increasing our costs."

Commenting on the Offer, Hamish Grossart, Chairman of Royal Doulton, said:

"I am delighted that we have been able to agree attractive offer terms with Waterford Wedgwood. The Enlarged Group will have outstanding people and enhanced competitiveness in the ceramic marketplace."

This summary should be read in conjunction with the full text of the following announcement. Appendix 2 to the following announcement contains definitions of certain terms used in this summary and in the following announcement.



 PRESS ENQUIRIES


  Waterford Wedgwood plc                     Tel: +353 1 4781 855

  Redmond O'Donoghue, Group Chief Executive Officer
  Peter Cameron, Group Chief Operating Officer
  Paul D'Alton, Group Chief Financial Officer

  Lazard & Co., Limited                      Tel: +44 20 7187 2000

  Nicholas Shott
  David Reitman

  Davy                                       Tel: +353 1 679 6363

  Hugh McCutcheon
  Eugenee Mulhern

  Panmure Gordon (UK Brokers)                Tel: +44 20 7187 2000

  Tim Linacre
  Hugh Morgan

  Powerscourt (UK/ International Media)      Tel: +44 20 7236 5615

  Rory Godson                                Tel: +44 7909 926 020

  Dennehy Associates (Ireland)               Tel: +353 1 676 4733

  Michael Dennehy                            Tel: +353 87 255 6923

  College Hill (Investor Relations)          Tel: +44 20 7457 2020

  Kate Pope                                  Tel: +44 7798 843 276
  Mark Garraway                              Tel: +44 7771 860 938

  Royal Doulton plc                          Tel: +44 1782 404 040

  Hamish Grossart
  Wayne Nutbeen

  Cazenove & Co. Ltd                         Tel: +44 20 7588 2828

  Richard Wintour
  Steve Baldwin

  Hudson Sandler                             Tel: +44 20 7796 4133

  Jessica Rouleau

Lazard is acting for Waterford Wedgwood UK and Waterford Wedgwood in connection with the Offer and no one else and will not be responsible to anyone other than Waterford Wedgwood UK and Waterford Wedgwood for providing the protections afforded to clients of Lazard nor for providing advice in connection with the Offer.

Cazenove is acting for Royal Doulton in connection with the Offer and no one else and will not be responsible to anyone other than Royal Doulton for providing the protections afforded to clients of Cazenove nor for providing advice in connection with the Offer.

The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law and therefore persons in any such jurisdictions into which this announcement is released, published or distributed should inform themselves about, and observe such restrictions. This announcement is not for release, distribution or publication in or into Canada, Australia or Japan or any other jurisdiction where it would be unlawful to do so.

The Offer will be made in the United States solely by Waterford Wedgwood UK. Neither Lazard nor any of its affiliates will be making the Offer in the United States.

The availability of the Offer to Royal Doulton Shareholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Royal Doulton Shareholders who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements.

The Offer Document and the Form of Acceptance will contain important information and will be made available to those Royal Doulton Shareholders who are able to receive them, as a result of the laws of the jurisdictions in which they are resident. Royal Doulton Shareholders are advised to read the Offer Document and the Form of Acceptance (if they are permitted to receive them) when they are sent to them.

Subject to applicable UK and United States regulatory requirements, including, without limitation, the requirements set forth in Rule 14e-5 of Regulation 14E under the United States Securities Exchange Act of 1934, as amended, Lazard and Waterford Wedgwood or its nominees or its brokers (acting as agents) may from time to time make certain purchases of, or arrangements to purchase, Royal Doulton Shares outside the United States, other than pursuant to the Offer, before or during the period in which the Offer remains open for acceptance. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Any information about such purchases will be disclosed as required in the United Kingdom and under applicable regulatory requirements (including applicable United States securities laws).

Cautionary Statement Regarding Forward Looking Statements: This announcement contains statements about the Waterford Wedgwood Group and the Royal Doulton Group that are or may be forward looking statements. All statements other than statements of historical facts included in this announcement may be forward looking statements. Any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "anticipates" or similar expressions or the negative thereof are forward-looking statements. Forward-looking statements include statements relating to the following (i) future capital expenditures, expenses, revenues, economic performance, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of the Waterford Wedgwood Group's or the Royal Doulton Group's operations; and (iii) the effects of government regulation on the Waterford Wedgwood Group's or the Royal Doulton Group's business.

These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of any such person, or industry results, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such persons and the environment in which each will operate in the future. All subsequent oral or written forward-looking statements attributable to the Waterford Wedgwood Group or the Royal Doulton Group or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above.



                        WATERFORD WEDGWOOD PLC
             RECOMMENDED CASH OFFER FOR ROYAL DOULTON PLC


  1.     Introduction

         The boards of Waterford Wedgwood U.K. plc ("Waterford
         Wedgwood UK"), a subsidiary of Waterford Wedgwood plc
         ("Waterford Wedgwood") and Royal Doulton plc ("Royal
         Doulton") announce that they have agreed the terms of a
         recommended cash offer to be made by or on behalf of
         Waterford Wedgwood UK for the entire issued and to be
         issued ordinary share capital of Royal Doulton other than
         (i) any Royal Doulton Shares held, or which become held,
         in treasury by Royal Doulton; and, (ii) the 70,339,352
         Royal Doulton Shares already owned by the Waterford
         Wedgwood Group (representing approximately 21.16 per cent.
         of Royal Doulton's issued share capital).

         The Royal Doulton Directors, who have been so advised by
         Cazenove, Royal Doulton's financial adviser, consider the
         terms of the Offer to be fair and reasonable. In providing
         its financial advice to the Royal Doulton Directors,
         Cazenove has taken into account the Royal Doulton
         Directors' commercial assessments of the Offer.
         Accordingly, the Royal Doulton Directors have unanimously
         recommended that Royal Doulton Shareholders accept the
         Offer, as they, and certain of their connected parties,
         have irrevocably undertaken to do in respect of their
         aggregate holdings of 7,214,235 Royal Doulton Shares,
         representing approximately 2 per cent. of Royal Doulton 's
         issued share capital, and in respect of, in aggregate,
         5,000,000 Royal Doulton Options and such of the 4,900,000
         Royal Doulton Shares subject to LTIP awards which are
         acquired by the Royal Doulton Directors pursuant to
         vesting of such awards.

  2.     The Offer

         The Offer, which will be on the terms and subject to the
         conditions set out below and in Appendix 1 and as set out
         in the Offer Document and the Form of Acceptance, will be
         made on the following basis:

            For each Royal Doulton Share         12p in cash

         The Offer values the whole of the issued share capital of
         Royal Doulton (including Royal Doulton Shares held by the
         Waterford Wedgwood Group as described in paragraph 4
         below, which are not the subject of the Offer) at
         approximately GBP 39.9 million (EUR 57.8 million) and
         represents a premium of 43 per cent. to the closing
         middle-market price of 8.38 pence per Royal Doulton Share
         on 20 October 2004 (the day before Waterford Wedgwood and
         Royal Doulton announced they were in talks regarding a
         potential offer for Royal Doulton).

         Royal Doulton Shares will be acquired pursuant to the
         Offer fully paid and free from all liens, charges,
         equities, encumbrances, rights of pre-emption and any
         other interests of any nature whatsoever and together with
         all rights now or hereafter attaching thereto, including
         voting rights and the right to receive and retain in full
         all dividends and other distributions (if any) declared,
         made or paid on or after 15 December 2004.

         The Offer is being made outside the United States by
         Lazard on behalf of Waterford Wedgwood UK and in the
         United States by Waterford Wedgwood UK. Royal Doulton
         Shareholders who are not resident in the United Kingdom
         should inform themselves about and observe any applicable
         requirements.

  3.     Background to and reasons for the Offer

         The directors of Waterford Wedgwood UK believe that, for
         the following reasons, the logic for a combination of
         Royal Doulton and Waterford Wedgwood is compelling:

         *                       First, the intended closure by
                                 Royal Doulton of its UK Nile
                                 Street factory at Stoke-on-Trent
                                 and the transfer of production of
                                 the Royal Doulton and Minton
                                 brands to Waterford Wedgwood's
                                 state-of-the-art Barlaston
                                 facility would result in lower
                                 incremental costs relative to the
                                 Nile Street costs, whilst also
                                 maximising production capacity at
                                 Barlaston.

         *                       Secondly, it is intended to
                                 implement a programme of
                                 rationalisation of retail
                                 operations and integration of
                                 administration functions, both
                                 globally and at head office
                                 levels, and to combine the Royal
                                 Doulton and Wedgwood purchasing
                                 and sourcing activities in order
                                 to yield further cost savings for
                                 the Enlarged Group.

         *                       Finally, the degree to which the
                                 Royal Doulton brands complement
                                 those of Waterford Wedgwood is
                                 important. Royal Doulton's brand
                                 recognition in the UK is very good
                                 (as confirmed by independent
                                 market research). The Enlarged
                                 Group would therefore benefit from
                                 a portfolio of strong brands. The
                                 combination of the sale and
                                 distribution of the Royal Doulton
                                 brands with those in the Waterford
                                 Wedgwood portfolio should yield
                                 further economies.


  4.     Irrevocable undertakings and holdings

         The Waterford Wedgwood Group currently holds 70,339,352
         Royal Doulton Shares representing, in aggregate, 21.16 per
         cent. of Royal Doulton's issued share capital. These Royal
         Doulton Shares will not be the subject of the Offer.

         Waterford Wedgwood UK has received irrevocable
         undertakings to accept (or procure acceptances of) the
         Offer from:

         (a)                     the Royal Doulton Directors (for
                                 themselves and on behalf of
                                 certain connected persons) in
                                 respect of their aggregate
                                 holdings of 7,214,235 Royal
                                 Doulton Shares, representing
                                 approximately 2 per cent. of Royal
                                 Doulton's issued share capital
                                 and, in respect of, in aggregate,
                                 5,000,000 Royal Doulton Options
                                 and such of the 4,900,000 Royal
                                 Doulton Shares subject to LTIP
                                 awards which are acquired by the
                                 Royal Doulton Directors pursuant
                                 to vesting of such awards; and

         (b)                     Sir Anthony O'Reilly, Chairman of
                                 Waterford Wedgwood (through
                                 Indexia Holdings Limited, a
                                 company which he wholly controls)
                                 and Mr Peter John Goulandris,
                                 Deputy Chairman of Waterford
                                 Wedgwood (through Cantique
                                 Holdings Limited, a company which
                                 he wholly controls) in respect of
                                 their aggregate holdings of
                                 13,250,000 Royal Doulton Shares,
                                 representing approximately 4 per
                                 cent. of Royal Doulton's issued
                                 share capital.

         The terms of these irrevocable undertakings require
         acceptance of the Offer even if a competing or higher
         offer from a third party is received by Royal Doulton.

         The Waterford Wedgwood Group therefore owns, or Waterford
         Wedgwood UK has received irrevocable undertakings to
         accept the Offer in respect of, a total of 90,803,587
         Royal Doulton Shares, representing approximately 27 per
         cent. of Royal Doulton's issued share capital.

  5.     Information relating to Waterford Wedgwood

         Waterford Wedgwood is one of the world's leading
         designers, manufacturers and marketers of high quality
         crystal, fine bone china and porcelain. The Waterford
         Wedgwood Group's portfolio of established luxury lifestyle
         brands includes Waterford crystal, Wedgwood fine bone
         china and Rosenthal porcelain. The Waterford Wedgwood
         Group also has well established co-branding relationships
         with a range of leading designers and celebrities,
         including Versace, Vera Wang, Jasper Conran and John
         Rocha.

         Waterford Wedgwood Stock Units are listed on the Irish
         Stock Exchange (primary listing) and on the London Stock
         Exchange (primary listing).

         For the year ended 31 March 2004, Waterford Wedgwood
         generated net sales of EUR 832 million including
         discontinued operations. In that year:

         *                       crystal accounted for 31.6 per
                                 cent. of net sales (EUR 263
                                 million);

         *                       ceramics accounted for 43.9 per
                                 cent. of net sales (EUR 366
                                 million);

         *                       premium cookware (including
                                 products manufactured and
                                 distributed by All-Clad) accounted
                                 for 12.0 per cent. of net sales
                                 (EUR 100 million); and

         *                       sales of other products (including
                                 Linens, Writing Instruments and
                                 Holiday Heirlooms) accounted for
                                 the remaining 12.4 per cent. of
                                 the Waterford Wedgwood Group's
                                 sales (EUR 103 million).

         On 2 June 2004, Waterford Wedgwood announced that it had
         entered into an agreement to sell All-Clad, its US based
         cookware subsidiary to Groupe SEB for a total
         consideration of USD 250 million (approximately EUR 206
         million). The sale completed on 27 July 2004.

  6.     Information relating to Royal Doulton

         Royal Doulton is engaged in the manufacture, distribution
         and sale of quality ceramic and glassware products to the
         giftware, collectable and tabletop markets. Royal Doulton,
         which has its origins in 1815, became a listed company in
         1993 following its demerger from Pearson plc.

         Royal Doulton's principal brands are Royal Doulton, Minton
         and Royal Albert. It has retail, concession and wholesale
         selling operations throughout the developed world, its
         primary markets being the UK, Canada, Australia, Japan and
         the United States, with distribution capabilities in each
         of these markets. By the end of 2002, Royal Doulton had
         transferred the production of its Royal Albert brand to
         Indonesia.

         In the year to 31 December 2003, Royal Doulton reported a
         loss before tax and after exceptional items of GBP 5.0
         million (EUR 7.2 million) on turnover of GBP 116.5 million
         (EUR 168.8 million). Net assets at 31 December 2003 were
         GBP 28.9 million (EUR 41.9 million).

  7.     Management and employees

         Waterford Wedgwood UK attaches importance to the skills
         and experience of the existing management and employees of
         Royal Doulton. The existing employment rights of the
         employees of Royal Doulton will be fully safeguarded.

         Based on information made available to them by Royal
         Doulton, the directors of Waterford Wedgwood UK have
         carefully considered the position of the Royal Doulton UK
         Pension Scheme, including the current level of
         contributions and the disclosed pension deficit. Waterford
         Wedgwood UK believes that as part of the Enlarged Group,
         Royal Doulton will be in a position to safeguard the
         interests of the members of the Royal Doulton UK Pension
         Scheme.

         Specific management changes proposed following the Offer
         would involve David Sculley, former Vice-President of H.J.
         Heinz Company and current non-executive director of
         Waterford Wedgwood, becoming Chairman of the combined
         Wedgwood and Royal Doulton businesses. Mr Sculley would
         assume responsibility for overseeing the integration. Mr
         Sculley's appointment, together with that of Wayne
         Nutbeen, Royal Doulton chief executive and Geoffrey
         Martin, Royal Doulton finance director, to the enlarged
         Wedgwood/Royal Doulton division would, with the existing
         Waterford Wedgwood team, create a management team with
         considerable ceramics and restructuring experience and
         expertise. These appointments would not affect the
         composition of the boards of Waterford Wedgwood or
         Waterford Wedgwood UK.

  8.     Share Option Plans and LTIPs

         The Offer extends to any Royal Doulton Shares which are
         unconditionally allotted or issued on or prior to the date
         on which the Offer closes (or such earlier date as
         Waterford Wedgwood UK may, subject to the City Code,
         decide), including shares issued pursuant to the exercise
         of options or the vesting of awards granted under the
         Royal Doulton Share Option Plans and the LTIPs.

         After the Offer becomes or is declared unconditional in
         all respects, it is expected that all outstanding options
         under the Royal Doulton Share Option Plans will become
         exercisable in full and all awards granted under the LTIPs
         will vest in full, save that (i) awards granted in 1998
         and 1999 under the Royal Doulton Incentive Share Plan will
         not vest as they are time expired and (ii) awards granted
         in 2004 under the Royal Doulton Long Term Incentive Plan
         2003 are expected to vest only as to one third of the
         Royal Doulton Shares subject to such awards.

         Appropriate proposals will be made in due course to
         participants in the Royal Doulton Share Option Plans and
         the LTIPs.

  9.     Extraordinary General Meeting

         In view of its size it is necessary for the shareholders
         of Waterford Wedgwood to approve the Offer. A notice
         convening the Extraordinary General Meeting has been
         despatched today to the shareholders of Waterford
         Wedgwood.

         The Offer is to be financed from the proceeds of a rights
         issue announced by Waterford Wedgwood on 21 October 2004
         (the "Rights Issue"). The Rights Issue is fully
         underwritten and will raise approximately EUR 100 million
         before expenses.

         None of the rights under the Rights Issue, or the
         securities to be issued under the Rights Issue has been or
         will be registered under the United States Securities Act
         of 1933, as amended; they may not be offered or sold in
         the United States absent registration or an applicable
         exemption from registration.

         The Offer is conditional upon:

         (a)                     the receipt by Waterford Wedgwood
                                 UK of valid acceptances (which are
                                 not, where permitted, withdrawn)
                                 by not later than 3.00 p.m.
                                 (London time) on 14 January 2005
                                 (or such later time(s) and/or
                                 date(s) as Waterford Wedgwood UK
                                 may determine, in accordance with
                                 the City Code and the United
                                 States Securities Exchange Act of
                                 1934, as amended, or otherwise
                                 with the consent of the Panel)
                                 (the "First Closing Date") in
                                 respect of not less than 90 per
                                 cent. (or such lesser percentage
                                 as Waterford Wedgwood UK may
                                 decide) in nominal value of the
                                 Royal Doulton Shares to which the
                                 Offer relates, provided that this
                                 condition will not be satisfied
                                 unless Waterford Wedgwood UK
                                 (together with Waterford Wedgwood
                                 and its wholly owned subsidiaries)
                                 shall have acquired or agreed to
                                 acquire (whether pursuant to the
                                 Offer or otherwise) Royal Doulton
                                 Shares carrying in aggregate more
                                 than 50 per cent. of the voting
                                 rights then normally exercisable
                                 at a general meeting of Royal
                                 Doulton;

         (b)                     the admission of all of the Stock
                                 Units to be issued under the terms
                                 of the Rights Issue, nil paid, to
                                 the official list of the Irish
                                 Stock Exchange and the official
                                 list maintained by the UK Listing
                                 Authority and to trading on the
                                 main markets for listed securities
                                 of the Irish Stock Exchange and
                                 the London Stock Exchange becoming
                                 effective in accordance with the
                                 Listing Rules and, in relation
                                 only to admission to trading of
                                 such units on the London Stock
                                 Exchange, the Admission and
                                 Disclosure Standards of the London
                                 Stock Exchange from time to time;

         (c)                     the holders of Waterford Wedgwood
                                 ordinary shares resolving, in
                                 general meeting, to approve the
                                 Offer in accordance with the
                                 requirements of the Listing Rules.
                                 A meeting of the holders of
                                 Waterford Wedgwood ordinary shares
                                 to consider and, if thought fit,
                                 to grant such approval has been
                                 convened for 10 January 2005; and

         (d)                     certain other conditions, being
                                 customary conditions for an offer
                                 of this nature.

  10.    Delisting of Royal Doulton Shares, compulsory acquisition,
         re-registration, deferred shares

         After the Offer becomes or is declared unconditional in
         all respects, Waterford Wedgwood UK intends to procure the
         making of an application by Royal Doulton to delist the
         Royal Doulton Shares from the Official List and/or the
         cancellation of trading on the London Stock Exchange's
         market for listed securities. It is anticipated that
         cancellation of listing and trading will take effect no
         earlier than 20 business days after the Offer becomes
         unconditional in all respects. Delisting would
         significantly reduce the liquidity and marketability of
         any Royal Doulton Shares not assented to the Offer.

         If Waterford Wedgwood UK receives acceptances under the
         Offer in respect of, and/or otherwise acquires, 90 per
         cent. or more of the Royal Doulton Shares to which the
         Offer relates, Waterford Wedgwood UK intends to exercise
         its rights pursuant to the provisions of sections 428 to
         430F (inclusive) of the Act to acquire compulsorily the
         remaining Royal Doulton Shares.

         It is also proposed that, following the Offer becoming
         unconditional in all respects and after the Royal Doulton
         Shares are delisted, Royal Doulton will be re-registered
         as a private company under the relevant provisions of the
         Act and that the Royal Doulton Deferred Shares in issue
         will be purchased by Royal Doulton for negligible
         consideration in accordance with the provisions of Royal
         Doulton's articles of association.

  11.    General

         The Offer will be on the terms and subject to the
         conditions set out herein and in Appendix 1, and as set
         out in the Offer Document and Form of Acceptance. The
         Offer Document together with a Form of Acceptance (in the
         case of shareholders who hold their shares in certificated
         form) is being sent to shareholders of Royal Doulton
         today.


 PRESS ENQUIRIES


  Waterford Wedgwood plc                     Tel: +353 1 4781 855

  Redmond O'Donoghue, Group Chief Executive Officer
  Peter Cameron, Group Chief Operating Officer
  Paul D'Alton, Group Chief Financial Officer

  Lazard & Co., Limited                      Tel: +44 20 7187 2000

  Nicholas Shott
  David Reitman

  Davy                                       Tel: +353 1 679 6363

  Hugh McCutcheon
  Eugenee Mulhern

  Panmure Gordon (UK Brokers)                Tel: +44 20 7187 2000

  Tim Linacre

  Hugh Morgan

  Powerscourt (UK/ International Media)      Tel: +44 20 7236 5615

  Rory Godson                                Tel: +44 7909 926 020

  Dennehy Associates (Ireland)               Tel: +353 1 676 4733

  Michael Dennehy                            Tel: +353 87 255 6923

  College Hill (Investor Relations)          Tel: +44 20 7457 2020

  Kate Pope                                  Tel: +44 7798 843 276
  Mark Garraway                              Tel: +44 7771 860 938

  Royal Doulton plc                          Tel: +44 1782 404 040

  Hamish Grossart
  Wayne Nutbeen

  Cazenove & Co. Ltd                         Tel: +44 20 7588 2828

  Richard Wintour
  Steve Baldwin

  Hudson Sandler                             Tel: +44 20 7796 4133

  Jessica Rouleau

Lazard is acting for Waterford Wedgwood UK and Waterford Wedgwood in connection with the Offer and no one else and will not be responsible to anyone other than Waterford Wedgwood UK and Waterford Wedgwood for providing the protections afforded to clients of Lazard nor for providing advice in connection with the Offer.

Cazenove is acting for Royal Doulton and no one else in connection with the Offer and will not be responsible to anyone other than Royal Doulton for providing the protections afforded to clients of Cazenove nor for providing advice in connection with the Offer.

The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law and therefore persons in any such jurisdictions into which this announcement is released, published or distributed should inform themselves about, and observe such restrictions. This announcement is not for release, distribution or publication in or into Canada, Australia or Japan or any other jurisdiction where it would be unlawful to do so.

The Offer will be made in the United States solely by Waterford Wedgwood UK. Neither Lazard nor any of its affiliates will be making the Offer in the United States.

The availability of the Offer to Royal Doulton Shareholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Royal Doulton Shareholders who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements.

The Offer Document and the Form of Acceptance will contain important information and will be made available to those Royal Doulton Shareholders who are able to receive them, as a result of the laws of the jurisdictions in which they are resident. Royal Doulton Shareholders are advised to read the Offer Document and the Form of Acceptance (if they are permitted to receive them) when they are sent to them.

Subject to applicable UK and United States regulatory requirements, including, without limitation, the requirements set forth in Rule 14e-5 of Regulation 14E under the United States Securities Exchange Act of 1934, as amended, Lazard and Waterford Wedgwood or its nominees or its brokers (acting as agents) may from time to time make certain purchases of, or arrangements to purchase, Royal Doulton Shares outside the United States, other than pursuant to the Offer, before or during the period in which the Offer remains open for acceptance. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Any information about such purchases will be disclosed as required in the United Kingdom and under applicable regulatory requirements (including applicable United States securities laws).

Cautionary Statement Regarding Forward Looking Statements: This announcement contains statements about the Waterford Wedgwood Group and the Royal Doulton Group that are or may be forward looking statements. All statements other than statements of historical facts included in this announcement may be forward looking statements. Any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "anticipates" or similar expressions or the negative thereof are forward-looking statements. Forward-looking statements include statements relating to the following (i) future capital expenditures, expenses, revenues, economic performance, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of the Waterford Wedgwood Group's or the Royal Doulton Group's operations; and (iii) the effects of government regulation on the Waterford Wedgwood Group's or the Royal Doulton Group's business.

These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of any such person, or industry results, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such persons and the environment in which each will operate in the future. All subsequent oral or written forward-looking statements attributable to the Waterford Wedgwood Group or the Royal Doulton Group or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above.



                         APPENDIX 1
        CONDITIONS AND FURTHER TERMS OF THE OFFER

The Offer, which is being made in the UK by Lazard on behalf of Waterford Wedgwood UK (and in the United States by Waterford Wedgwood UK), will comply with the applicable rules and regulations of the UK Listing Authority, the London Stock Exchange and the City Code, will be governed by English law and will be subject to the jurisdiction of the Courts of England. In addition it will be subject to the terms and conditions set out in the Offer Document and related Form of Acceptance.



  1.    Conditions of the Offer

        The Offer is conditional on:

        (a)                valid acceptances being received (and
                           not, where permitted, withdrawn) by not
                           later than 3.00 p.m. (London time) on 14
                           January 2005 (or such later time(s)
                           and/or date(s) as Waterford Wedgwood UK
                           may determine, in accordance with the
                           City Code and the United States
                           Securities Exchange Act of 1934, as
                           amended, or otherwise with the consent
                           of the Panel) (the "First Closing Date")
                           in respect of not less than 90 per cent.
                           (or such lesser percentage as Waterford
                           Wedgwood UK may decide) in nominal value
                           of the Royal Doulton Shares to which the
                           Offer relates, provided that this
                           condition will not be satisfied unless
                           Waterford Wedgwood UK (together with
                           Waterford Wedgwood and its wholly owned
                           subsidiaries) shall have acquired or
                           agreed to acquire (whether pursuant to
                           the Offer or otherwise) Royal Doulton
                           Shares carrying in aggregate more than
                           50 per cent. of the voting rights then
                           normally exercisable at a general
                           meeting of Royal Doulton, including for
                           this purpose any such voting rights
                           attaching to Royal Doulton Shares that
                           are unconditionally allotted or issued
                           before the Offer becomes or is declared
                           unconditional as to acceptances whether
                           pursuant to the exercise of any
                           outstanding subscription or conversion
                           rights or otherwise.

                           For the purposes of this condition:

                           (i)                    Royal Doulton
                                                  Shares which have
                                                  been
                                                  unconditionally
                                                  allotted (but not
                                                  issued) shall be
                                                  deemed to carry
                                                  the voting rights
                                                  they will carry
                                                  upon issue;

                           (ii)                   the expression
                                                  "Royal Doulton
                                                  Shares to which
                                                  the Offer
                                                  relates" shall be
                                                  construed in
                                                  accordance with
                                                  sections 428 to
                                                  430F of the Act;
                                                  and

                           (iii)                  valid acceptances
                                                  shall be deemed
                                                  to have been
                                                  received in
                                                  respect of Royal
                                                  Doulton Shares
                                                  which are treated
                                                  for the purposes
                                                  of section 429(8)
                                                  of the Act as
                                                  having been
                                                  acquired or
                                                  contracted to be
                                                  acquired by
                                                  Waterford
                                                  Wedgwood UK by
                                                  virtue of
                                                  acceptances of
                                                  the Offer;

        (b)                the passing at an extraordinary general
                           meeting of Waterford Wedgwood (or at any
                           adjournment of the meeting) of all
                           resolutions as are necessary:

                           (i)                    to approve the
                                                  Offer in
                                                  accordance with
                                                  Chapter 10 of the
                                                  Listing Rules;
                                                  and

                           (ii)                   otherwise to
                                                  fund, effect and
                                                  implement the
                                                  Offer and the
                                                  acquisition of
                                                  any shares in
                                                  Royal Doulton;

        (c)                the admission to the official list of
                           the Irish Stock Exchange and to the
                           Official List of all of the Stock Units
                           (nil paid) to be issued pursuant to the
                           Rights Issue becoming effective in
                           accordance with the listing rules of the
                           Irish Stock Exchange and the listing
                           rules of the UK Listing Authority
                           (respectively) and the admission to
                           trading on the respective main markets
                           for listed securities of the Irish Stock
                           Exchange and the London Stock Exchange
                           becoming effective in accordance with
                           the listing rules of the Irish Stock
                           Exchange and the Admission and
                           Disclosure Standards of the London Stock
                           Exchange from time to time;

        (d)                all necessary notifications and filings
                           having been made and all applicable
                           waiting periods (including any
                           extensions thereof) under the United
                           States Hart Scott Rodino Antitrust
                           Improvements Act of 1976 (as amended)
                           and the regulations made thereunder
                           having expired, lapsed or been
                           terminated as appropriate in each case
                           in respect of the Offer (including,
                           without limitation, in respect of its
                           implementation and financing) and the
                           acquisition or the proposed acquisition
                           of any shares or other securities in, or
                           control of, Royal Doulton by any member
                           of the Wider Waterford Wedgwood Group;

        (e)                no government or governmental,
                           quasi-governmental, supranational,
                           statutory, regulatory, environmental,
                           administrative, fiscal or investigative
                           body, court, trade agency, association,
                           institution or any other body or person
                           whatsoever in any jurisdiction (each a
                           "Third Party") having given notice to
                           Royal Doulton or Waterford Wedgwood UK
                           that it has decided to take, institute,
                           implement or threaten any action,
                           proceeding, suit, investigation, enquiry
                           or reference, or having required any
                           action to be taken or otherwise having
                           done anything or having enacted, made or
                           proposed any statute, regulation,
                           decision, order or change to published
                           practice and there not continuing to be
                           outstanding any statute, regulation,
                           decision or order which would or might
                           be expected to:

                           (i)                    make the Offer,
                                                  its
                                                  implementation or
                                                  the acquisition
                                                  or proposed
                                                  acquisition of
                                                  any shares or
                                                  other securities
                                                  in, or control
                                                  of, Royal Doulton
                                                  by any member of
                                                  the Wider
                                                  Waterford
                                                  Wedgwood Group
                                                  void, illegal
                                                  and/or
                                                  unenforceable
                                                  under the laws of
                                                  any jurisdiction,
                                                  or otherwise
                                                  directly or
                                                  indirectly
                                                  prohibit, or
                                                  materially
                                                  restrain,
                                                  restrict, delay
                                                  or otherwise
                                                  interfere with
                                                  the
                                                  implementation
                                                  of, or impose
                                                  material
                                                  additional
                                                  conditions or
                                                  obligations with
                                                  respect to, or
                                                  otherwise
                                                  materially
                                                  challenge or
                                                  require amendment
                                                  of the Offer or
                                                  the acquisition
                                                  of any such
                                                  shares or
                                                  securities by any
                                                  member of the
                                                  Wider Waterford
                                                  Wedgwood Group;

                           (ii)                   require, prevent
                                                  or materially
                                                  delay the
                                                  divestiture or
                                                  materially alter
                                                  the terms
                                                  envisaged for
                                                  such divestiture
                                                  by any member of
                                                  the Wider
                                                  Waterford
                                                  Wedgwood Group or
                                                  by any member of
                                                  the Wider Royal
                                                  Doulton Group of
                                                  all or any part
                                                  of its
                                                  businesses,
                                                  assets or
                                                  property or
                                                  impose any
                                                  limitation on the
                                                  ability of any of
                                                  them to conduct
                                                  their businesses
                                                  (or any part
                                                  thereof) or to
                                                  own any of their
                                                  assets or
                                                  properties (or
                                                  any part thereof)
                                                  to an extent
                                                  which is material
                                                  in the context of
                                                  the Wider
                                                  Waterford
                                                  Wedgwood Group or
                                                  the Wider Royal
                                                  Doulton Group
                                                  taken as a whole;

                           (iii)                  impose any
                                                  material
                                                  limitation on, or
                                                  result in a
                                                  material delay
                                                  in, the ability
                                                  of any member of
                                                  the Wider
                                                  Waterford
                                                  Wedgwood Group
                                                  directly or
                                                  indirectly to
                                                  acquire or hold
                                                  or to exercise
                                                  effectively all
                                                  or any rights of
                                                  ownership in
                                                  respect of shares
                                                  or other
                                                  securities in
                                                  Royal Doulton or
                                                  on the ability of
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group or
                                                  any member of the
                                                  Wider Waterford
                                                  Wedgwood Group
                                                  directly or
                                                  indirectly to
                                                  hold or exercise
                                                  effectively any
                                                  rights of
                                                  ownership in
                                                  respect of shares
                                                  or other
                                                  securities (or
                                                  the equivalent)
                                                  in, or to
                                                  exercise
                                                  management
                                                  control over, any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group;

                           (iv)                   require any
                                                  member of the
                                                  Wider Waterford
                                                  Wedgwood Group or
                                                  the Wider Royal
                                                  Doulton Group to
                                                  acquire or offer
                                                  to acquire any
                                                  shares, other
                                                  securities (or
                                                  the equivalent)
                                                  or interest in
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  owned by any
                                                  third party
                                                  (other than in
                                                  the
                                                  implementation of
                                                  the Offer);

                           (v)                    require, prevent
                                                  or materially
                                                  delay a
                                                  divestiture by
                                                  any member of the
                                                  Wider Waterford
                                                  Wedgwood Group of
                                                  any shares or
                                                  other securities
                                                  (or the
                                                  equivalent) in
                                                  Royal Doulton;

                           (vi)                   result in any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  ceasing to be
                                                  able to carry on
                                                  business under
                                                  any name under
                                                  which it
                                                  presently does so
                                                  to an extent
                                                  which is material
                                                  in the context of
                                                  the Royal Doulton
                                                  Group taken as a
                                                  whole;

                           (vii)                  impose any
                                                  material
                                                  limitation on the
                                                  ability of any
                                                  member of the
                                                  Wider Waterford
                                                  Wedgwood Group or
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group to
                                                  integrate or
                                                  co-ordinate all
                                                  or any part of
                                                  its business with
                                                  all or any part
                                                  of the business
                                                  of any other
                                                  member of the
                                                  Wider Waterford
                                                  Wedgwood Group
                                                  and/or the Wider
                                                  Royal Doulton
                                                  Group; or

                           (viii)                 except as fairly
                                                  disclosed in
                                                  writing by Royal
                                                  Doulton to
                                                  Waterford
                                                  Wedgwood UK prior
                                                  to 10 December
                                                  2004 or as
                                                  publicly
                                                  announced to a
                                                  Regulatory
                                                  Information
                                                  Service by or on
                                                  behalf of Royal
                                                  Doulton before
                                                  that date,
                                                  otherwise affect
                                                  the business,
                                                  assets, profits
                                                  or prospects of
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group or
                                                  any member of the
                                                  Wider Waterford
                                                  Wedgwood Group in
                                                  a manner which is
                                                  adverse to and
                                                  material in the
                                                  context of the
                                                  Royal Doulton
                                                  Group taken as a
                                                  whole or of the
                                                  obligations of
                                                  any members of
                                                  the Waterford
                                                  Wedgwood Group
                                                  taken as a whole
                                                  in connection
                                                  with the Offer
                                                  (as the case may
                                                  be),

                           and all applicable waiting and other
                           time periods during which any such Third
                           Party could decide to take, institute or
                           implement any such action, proceeding,
                           suit, investigation, enquiry or
                           reference or take any other step in
                           relation thereto under the laws of any
                           jurisdiction in respect of the Offer or
                           the acquisition or proposed acquisition
                           of any Royal Doulton Shares or otherwise
                           intervene having expired, lapsed, or
                           been terminated;

        (f)                no undertakings or assurances being
                           sought from Waterford Wedgwood UK, any
                           member of the Wider Waterford Wedgwood
                           Group or any member of the Wider Royal
                           Doulton Group by the Secretary of State
                           for Trade and Industry or any other
                           third party, the effect of which would
                           be material in the context of the
                           business of the Wider Waterford Wedgwood
                           Group, except on terms satisfactory to
                           Waterford Wedgwood UK;

        (g)                all necessary notifications, filings or
                           applications having been made in
                           connection with the Offer and all
                           necessary waiting periods (including any
                           extensions thereof) under any applicable
                           legislation or regulation of any
                           jurisdiction having expired, lapsed or
                           been terminated (as appropriate) and all
                           statutory and regulatory obligations in
                           any jurisdiction having been complied
                           with and all Authorisations necessary in
                           any jurisdiction for or in respect of
                           the Offer and the acquisition or the
                           proposed acquisition of any shares or
                           other securities in, or control of,
                           Royal Doulton by any member of the Wider
                           Waterford Wedgwood Group having been
                           obtained in terms and in a form
                           satisfactory to Waterford Wedgwood UK
                           from all appropriate Third Parties or
                           (without prejudice to the generality of
                           the foregoing) from any person or bodies
                           with whom any member of the Wider Royal
                           Doulton Group or the Wider Waterford
                           Wedgwood Group has entered into
                           contractual arrangements and all such
                           Authorisations necessary or appropriate
                           to carry on the business of any member
                           of the Wider Royal Doulton Group in any
                           jurisdiction having been obtained in
                           each case where the direct consequence
                           of a failure to make such notification
                           or filing or to wait for the expiry,
                           lapse or termination of any such waiting
                           period or to comply with such obligation
                           or obtain such Authorisation would have
                           a material adverse effect on the Royal
                           Doulton Group, any member of the
                           Waterford Wedgwood Group or the ability
                           of Waterford Wedgwood UK to implement
                           the Offer and all such Authorisations
                           remaining in full force and effect at
                           the time at which the Offer becomes
                           otherwise unconditional and there being
                           no notice or intimation of an intention
                           to revoke, suspend, restrict, modify or
                           not to renew such Authorisations;

        (h)                except as fairly disclosed in the Annual
                           Report and Accounts or in the Royal
                           Doulton Interim Results or as publicly
                           announced to a Regulatory Information
                           Service by or on behalf of Royal Doulton
                           before 10 December 2004 or as fairly
                           disclosed in writing by Royal Doulton to
                           Waterford Wedgwood UK before 10 December
                           2004, there being no provision of any
                           arrangement, agreement, licence, permit,
                           lease or other instrument to which any
                           member of the Wider Royal Doulton Group
                           is a party or by or to which any such
                           member or any of its assets is or may be
                           bound or be subject or any event or
                           circumstance which, as a consequence of
                           the Offer or the acquisition or the
                           proposed acquisition by any member of
                           the Wider Waterford Wedgwood Group of
                           any shares or other securities in Royal
                           Doulton or because of a change in the
                           control or management of any member of
                           the Wider Royal Doulton Group or
                           otherwise, could or might reasonably be
                           expected to result in, in each case to
                           an extent which is material in the
                           context of the Royal Doulton Group taken
                           as a whole:

                           (i)                    any monies
                                                  borrowed by, or
                                                  any other
                                                  indebtedness,
                                                  actual or
                                                  contingent, of
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  being or becoming
                                                  repayable, or
                                                  capable of being
                                                  declared
                                                  repayable,
                                                  immediately or
                                                  prior to its or
                                                  their stated
                                                  maturity date or
                                                  repayment date,
                                                  or the ability of
                                                  any such member
                                                  to borrow monies
                                                  or incur any
                                                  indebtedness
                                                  being withdrawn
                                                  or inhibited or
                                                  being capable of
                                                  becoming or being
                                                  withdrawn or
                                                  inhibited;

                           (ii)                   the rights,
                                                  liabilities,
                                                  obligations,
                                                  interests or
                                                  business of any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  under any such
                                                  arrangement,
                                                  agreement,
                                                  licence, permit,
                                                  lease or
                                                  instrument or the
                                                  interests or
                                                  business of any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group in
                                                  or with any other
                                                  firm or company
                                                  or body or person
                                                  (or any agreement
                                                  or arrangement
                                                  relating to any
                                                  such business or
                                                  interests) being
                                                  terminated or
                                                  adversely
                                                  modified or
                                                  affected or any
                                                  onerous
                                                  obligation or
                                                  liability arising
                                                  or any adverse
                                                  action being
                                                  taken thereunder;

                           (iii)                  any member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  ceasing to be
                                                  able to carry on
                                                  business under
                                                  any name under
                                                  which it
                                                  presently does so
                                                  to an extent
                                                  which is material
                                                  in the context of
                                                  the Royal Doulton
                                                  Group taken as a
                                                  whole;

                           (iv)                   any assets or
                                                  interests of, or
                                                  any asset the use
                                                  of which is
                                                  enjoyed by, any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  being or falling
                                                  to be disposed of
                                                  or charged or any
                                                  right arising
                                                  under which any
                                                  such asset or
                                                  interest could be
                                                  required to be
                                                  disposed of or
                                                  charged or could
                                                  cease to be
                                                  available to any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group;

                           (v)                    the creation or
                                                  enforcement of
                                                  any mortgage,
                                                  charge or other
                                                  security interest
                                                  over the whole or
                                                  any part of the
                                                  business,
                                                  property or
                                                  assets of any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group;

                           (vi)                   the value of, or
                                                  the financial or
                                                  trading position
                                                  of, any member of
                                                  the Wider Royal
                                                  Doulton Group
                                                  being prejudiced
                                                  or adversely
                                                  affected; or

                           (vii)                  the creation of
                                                  any liability
                                                  (actual or
                                                  contingent) by
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  other than in the
                                                  ordinary course
                                                  of business;

        (i)                except as fairly disclosed in the Annual
                           Report and Accounts or in the Royal
                           Doulton Interim Results or as publicly
                           announced to a Regulatory Information
                           Service by or on behalf of Royal Doulton
                           before 10 December 2004 or as fairly
                           disclosed in writing by Royal Doulton to
                           Waterford Wedgwood UK before 10 December
                           2004, no member of the Wider Royal
                           Doulton Group having, since 31 December
                           2003:

                           (i)                    issued or agreed
                                                  to issue or
                                                  authorised or
                                                  proposed the
                                                  issue of
                                                  additional shares
                                                  of any class, or
                                                  securities or
                                                  securities
                                                  convertible into,
                                                  or exchangeable
                                                  for, or rights,
                                                  warrants or
                                                  options to
                                                  subscribe for or
                                                  acquire, any such
                                                  shares or
                                                  convertible
                                                  securities or
                                                  transferred or
                                                  sold or agreed to
                                                  transfer or sell
                                                  or authorised or
                                                  proposed the
                                                  transfer or sale
                                                  of Royal Doulton
                                                  Shares out of
                                                  treasury (save,
                                                  where relevant,
                                                  as between Royal
                                                  Doulton and
                                                  wholly-owned
                                                  subsidiaries of
                                                  Royal Doulton and
                                                  save for the
                                                  issue or transfer
                                                  out of treasury
                                                  of Royal Doulton
                                                  Shares on the
                                                  exercise of
                                                  options or the
                                                  vesting of LTIP
                                                  awards granted
                                                  before 20 October
                                                  2004 (the day
                                                  before Waterford
                                                  Wedgwood and
                                                  Royal Doulton
                                                  announced they
                                                  were in talks
                                                  regarding a
                                                  potential offer
                                                  for Royal
                                                  Doulton);

                           (ii)                   recommended,
                                                  declared, paid or
                                                  made or proposed
                                                  to recommend,
                                                  declare, pay or
                                                  make any bonus,
                                                  dividend or other
                                                  distribution
                                                  (whether payable
                                                  in cash or
                                                  otherwise) other
                                                  than to Royal
                                                  Doulton or one of
                                                  its wholly-owned
                                                  subsidiaries;

                           (iii)                  save for
                                                  transactions
                                                  between Royal
                                                  Doulton and its
                                                  wholly owned
                                                  subsidiaries,
                                                  merged with or
                                                  demerged from or
                                                  acquired any body
                                                  corporate,
                                                  partnership or
                                                  business or
                                                  acquired or
                                                  disposed of, or,
                                                  other than in the
                                                  ordinary course
                                                  of business,
                                                  transferred,
                                                  mortgaged or
                                                  charged or
                                                  created any
                                                  security interest
                                                  over, any assets
                                                  or any right,
                                                  title or interest
                                                  in any asset
                                                  (including shares
                                                  and trade
                                                  investments) or
                                                  authorised,
                                                  proposed or
                                                  announced any
                                                  intention to do
                                                  so, in each case
                                                  to an extent
                                                  which is material
                                                  in the context of
                                                  the Royal Doulton
                                                  Group;

                           (iv)                   save for
                                                  transactions
                                                  between Royal
                                                  Doulton and its
                                                  wholly owned
                                                  subsidiaries or
                                                  between such
                                                  wholly owned
                                                  subsidiaries,
                                                  made, authorised,
                                                  proposed or
                                                  announced an
                                                  intention to
                                                  propose any
                                                  change in its
                                                  loan capital;

                           (v)                    issued,
                                                  authorised or
                                                  proposed the
                                                  issue of any
                                                  debentures or
                                                  (save in the
                                                  ordinary course
                                                  of business and
                                                  save as between
                                                  Royal Doulton and
                                                  its wholly-owned
                                                  subsidiaries or
                                                  between such
                                                  wholly-owned
                                                  subsidiaries)
                                                  incurred or
                                                  increased any
                                                  indebtedness or
                                                  become subject to
                                                  any contingent
                                                  liability to an
                                                  extent which is
                                                  material in the
                                                  context of the
                                                  Royal Doulton
                                                  Group;

                           (vi)                   entered into or
                                                  varied or
                                                  authorised,
                                                  proposed or
                                                  announced its
                                                  intention to
                                                  enter into or
                                                  vary any
                                                  contract,
                                                  transaction,
                                                  arrangement or
                                                  commitment
                                                  (whether in
                                                  respect of
                                                  capital
                                                  expenditure or
                                                  otherwise) which
                                                  is of a long
                                                  term, unusual or
                                                  onerous nature or
                                                  magnitude, or
                                                  which involves or
                                                  could involve an
                                                  obligation of a
                                                  nature or
                                                  magnitude which
                                                  is, in any such
                                                  case, material in
                                                  the context of
                                                  the Royal Doulton
                                                  Group or which is
                                                  or is likely to
                                                  be restrictive on
                                                  the business of
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group or
                                                  the Wider
                                                  Waterford
                                                  Wedgwood Group,
                                                  in each case to
                                                  an extent which
                                                  is material in
                                                  the context of
                                                  the Royal Doulton
                                                  Group;

                           (vii)                  entered into or
                                                  varied the terms
                                                  of any service
                                                  agreement with
                                                  any director or
                                                  senior executive
                                                  of the Wider
                                                  Royal Doulton
                                                  Group;

                           (viii)                 proposed, agreed
                                                  to provide or
                                                  modified in any
                                                  material respect
                                                  the terms of any
                                                  share option
                                                  scheme, incentive
                                                  scheme, or other
                                                  benefit relating
                                                  to the employment
                                                  or termination of
                                                  employment of any
                                                  employee of the
                                                  Wider Royal
                                                  Doulton Group
                                                  which, taken as a
                                                  whole, are
                                                  material in the
                                                  context of the
                                                  Royal Doulton
                                                  Group taken as a
                                                  whole;

                           (ix)                   made or agreed or
                                                  consented to any
                                                  significant
                                                  change to the
                                                  terms of the
                                                  trust deeds or
                                                  other documents
                                                  constituting or
                                                  governing the
                                                  pension schemes
                                                  established for
                                                  its directors,
                                                  employees or
                                                  former directors
                                                  or employees or
                                                  their dependants
                                                  or the benefits
                                                  which accrue, or
                                                  to the pensions
                                                  which are
                                                  payable,
                                                  thereunder, or to
                                                  the basis on
                                                  which
                                                  qualification
                                                  for, or accrual
                                                  or entitlement
                                                  to, such benefits
                                                  or pensions are
                                                  calculated or
                                                  determined or to
                                                  the basis on
                                                  which the
                                                  liabilities
                                                  (including
                                                  pensions) of such
                                                  pension schemes
                                                  are funded or
                                                  made or to the
                                                  basis upon which
                                                  any such scheme
                                                  is, or is to be,
                                                  funded or which
                                                  might otherwise
                                                  result in any
                                                  contribution or
                                                  other payment
                                                  becoming due and
                                                  payable by any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group to
                                                  or in respect of
                                                  such scheme, or
                                                  agreed or
                                                  consented to any
                                                  change to the
                                                  trustees
                                                  involving the
                                                  appointment of a
                                                  trust
                                                  corporation;

                           (x)                    implemented,
                                                  effected or
                                                  authorised,
                                                  proposed or
                                                  announced its
                                                  intention to
                                                  implement any
                                                  composition,
                                                  assignment,
                                                  reconstruction,
                                                  amalgamation,
                                                  commitment,
                                                  scheme or other
                                                  transaction or
                                                  arrangement
                                                  (other than the
                                                  Offer) otherwise
                                                  than in the
                                                  ordinary course
                                                  of business;

                           (xi)                   purchased,
                                                  redeemed or
                                                  repaid or
                                                  announced any
                                                  proposal to
                                                  purchase, redeem
                                                  or repay any of
                                                  its own shares or
                                                  other securities
                                                  or reduced or,
                                                  save in respect
                                                  of the matters
                                                  mentioned in
                                                  sub-paragraph (i)
                                                  above, made any
                                                  other change to
                                                  any part of its
                                                  share capital;

                           (xii)                  waived or
                                                  compromised any
                                                  claim otherwise
                                                  than in the
                                                  ordinary course
                                                  of business which
                                                  is material in
                                                  the context of
                                                  the Royal Doulton
                                                  Group taken as a
                                                  whole;

                           (xiii)                 made any material
                                                  alteration to its
                                                  memorandum or
                                                  articles of
                                                  association or
                                                  other
                                                  incorporation
                                                  documents;

                           (xiv)                  other than in
                                                  respect of a
                                                  member which is
                                                  dormant and was
                                                  solvent at the
                                                  relevant time,
                                                  taken or proposed
                                                  any steps,
                                                  corporate action
                                                  or had any legal
                                                  proceedings
                                                  instituted or
                                                  threatened
                                                  against it in
                                                  relation to the
                                                  suspension of
                                                  payments, a
                                                  moratorium of any
                                                  indebtedness, its
                                                  winding-up
                                                  (voluntary or
                                                  otherwise),
                                                  dissolution,
                                                  reorganisation or
                                                  for the
                                                  appointment of
                                                  any
                                                  administrator,
                                                  receiver,
                                                  manager,
                                                  administrative
                                                  receiver, trustee
                                                  or similar
                                                  officer of any of
                                                  its assets or
                                                  revenues or any
                                                  analogous
                                                  proceedings in
                                                  any jurisdiction
                                                  or appointed any
                                                  analogous person
                                                  in any
                                                  jurisdiction or
                                                  had any such
                                                  person appointed;

                           (xv)                   been unable, or
                                                  admitted in
                                                  writing that it
                                                  is unable, to pay
                                                  its debts or
                                                  commenced
                                                  negotiations with
                                                  one or more of
                                                  its creditors
                                                  with a view to
                                                  rescheduling or
                                                  restructuring any
                                                  of its
                                                  indebtedness, or
                                                  having stopped or
                                                  suspended (or
                                                  threatened to
                                                  stop or suspend)
                                                  payment of its
                                                  debts generally
                                                  or ceased or
                                                  threatened to
                                                  cease carrying on
                                                  all or a
                                                  substantial part
                                                  of its business;
                                                  or

                           (xvi)                  entered into any
                                                  contract,
                                                  commitment,
                                                  agreement or
                                                  arrangement
                                                  otherwise than in
                                                  the ordinary
                                                  course of
                                                  business or
                                                  passed any
                                                  resolution or
                                                  made any offer
                                                  (which remains
                                                  open for
                                                  acceptance) with
                                                  respect to or
                                                  announced an
                                                  intention to, or
                                                  to propose to,
                                                  effect any of the
                                                  transactions,
                                                  matters or events
                                                  referred to in
                                                  this condition;

        (j)                since 31 December 2003, and except as
                           fairly disclosed in the Annual Report
                           and Accounts or in the Royal Doulton
                           Interim Results or as publicly announced
                           to a Regulatory Information Service by
                           or on behalf of Royal Doulton before 10
                           December 2004 or as fairly disclosed in
                           writing by Royal Doulton to Waterford
                           Wedgwood UK before 10 December 2004:

                           (i)                    there having been
                                                  no adverse change
                                                  in the business,
                                                  assets, financial
                                                  or trading
                                                  position or
                                                  profits or
                                                  prospects or
                                                  operational
                                                  performance of
                                                  any member of the
                                                  Wider Royal
                                                  Doulton Group to
                                                  an extent which
                                                  is material to
                                                  the Royal Doulton
                                                  Group taken as a
                                                  whole;

                           (ii)                   no litigation,
                                                  arbitration
                                                  proceedings,
                                                  prosecution or
                                                  other legal
                                                  proceedings
                                                  having been
                                                  threatened,
                                                  announced or
                                                  instituted by or
                                                  against or
                                                  remaining
                                                  outstanding
                                                  against any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group or
                                                  to which any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group is
                                                  or may become a
                                                  party (whether as
                                                  claimant or
                                                  defendant or
                                                  otherwise) and no
                                                  enquiry or
                                                  investigation,
                                                  other than as a
                                                  result of the
                                                  Offer, by, or
                                                  complaint or
                                                  reference to, any
                                                  Third Party
                                                  against or in
                                                  respect of any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  having been
                                                  threatened,
                                                  announced or
                                                  instituted by or
                                                  against, or
                                                  remaining
                                                  outstanding in
                                                  respect of, any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  which, in any
                                                  such case, might
                                                  reasonably be
                                                  expected
                                                  materially and
                                                  adversely to
                                                  affect the Royal
                                                  Doulton Group
                                                  taken as a whole;

                           (iii)                  no contingent or
                                                  other liability
                                                  having arisen or
                                                  become known to
                                                  Waterford
                                                  Wedgwood UK which
                                                  might be likely
                                                  to adversely
                                                  affect the
                                                  business, assets,
                                                  financial or
                                                  trading position
                                                  or profits or
                                                  prospects of any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group to
                                                  an extent which
                                                  is material to
                                                  the Royal Doulton
                                                  Group taken as a
                                                  whole; and

                           (iv)                   no steps having
                                                  been taken and no
                                                  omissions having
                                                  been made which
                                                  are likely to
                                                  result in the
                                                  withdrawal,
                                                  cancellation,
                                                  termination or
                                                  modification of
                                                  any licence held
                                                  by any member of
                                                  the Wider Royal
                                                  Doulton Group,
                                                  which is
                                                  necessary for the
                                                  proper carrying
                                                  on of its
                                                  business and the
                                                  withdrawal,
                                                  cancellation,
                                                  termination or
                                                  modification of
                                                  which is material
                                                  and likely
                                                  adversely to
                                                  affect the Royal
                                                  Doulton Group
                                                  taken as a whole;

        (k)                since 31 December 2003, and except as
                           fairly disclosed in the Annual Report
                           and Accounts or in the Royal Doulton
                           Interim Results or as publicly announced
                           to a Regulatory Information Service by
                           or on behalf of Royal Doulton before 10
                           December 2004 or as fairly disclosed in
                           writing by Royal Doulton to Waterford
                           Wedgwood UK before 10 December 2004,
                           Waterford Wedgwood UK not having
                           discovered:

                           (i)                    that any
                                                  financial,
                                                  business or other
                                                  information
                                                  concerning the
                                                  Wider Royal
                                                  Doulton Group
                                                  publicly
                                                  disclosed or
                                                  disclosed to any
                                                  member of the
                                                  Wider Waterford
                                                  Wedgwood Group at
                                                  any time by or on
                                                  behalf of any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  which is material
                                                  in the context of
                                                  the acquisition
                                                  of Royal Doulton
                                                  by any member of
                                                  Waterford
                                                  Wedgwood Group is
                                                  materially
                                                  misleading,
                                                  contains a
                                                  material
                                                  misrepresentation
                                                  of fact or omits
                                                  to state a fact
                                                  necessary to make
                                                  that information
                                                  not misleading;

                           (ii)                   that any member
                                                  of the Wider
                                                  Royal Doulton
                                                  Group is subject
                                                  to any liability,
                                                  contingent or
                                                  otherwise, which
                                                  is not disclosed
                                                  in the Annual
                                                  Report and
                                                  Accounts or the
                                                  Royal Doulton
                                                  Interim Results,
                                                  and which is
                                                  material in the
                                                  context of the
                                                  Royal Doulton
                                                  Group; and

                           (iii)                  any information
                                                  which affects the
                                                  import of any
                                                  information
                                                  disclosed to
                                                  Waterford
                                                  Wedgwood UK at
                                                  any time by or on
                                                  behalf of any
                                                  member of the
                                                  Wider Royal
                                                  Doulton Group
                                                  which is material
                                                  in the context of
                                                  the Royal Doulton
                                                  Group; and

        (l)                in relation to any release, emission,
                           accumulation, discharge, disposal or
                           other fact or circumstance which has
                           impaired or is likely to impair the
                           environment (including property) or
                           harmed or is likely to harm human
                           health, no past or present member of the
                           Wider Royal Doulton Group, in a manner
                           or to an extent which is material in the
                           context of the Royal Doulton Group, (i)
                           having committed any violation of any
                           applicable laws, statutes, regulations,
                           notices or other requirements of any
                           Third Party; and/or (ii) having incurred
                           any liability (whether actual or
                           contingent) to any Third Party; and/or
                           (iii) being likely to incur any
                           liability (whether actual or
                           contingent), or being required, to make
                           good, remediate, repair, re-instate or
                           clean up the environment (including any
                           property).

        Waterford Wedgwood UK reserves the right to waive in whole
        or in part all or any of conditions (d) to (l) inclusive.
        Conditions (b) to (l) inclusive must be satisfied as at, or
        waived (where possible) on or before, the later of midnight
        on the 21st day after First Closing Date and the date on
        which condition (a) is fulfilled (or, in each case, such
        later date as the Panel may agree). Waterford Wedgwood UK
        shall be under no obligation to waive, or to determine to
        be or treat as fulfilled, any of conditions (b) to (l)
        inclusive by a date earlier than the date specified above
        for the fulfilment thereof notwithstanding that the other
        conditions of the Offer may at such earlier date have been
        waived or fulfilled and that there are at such earlier date
        no circumstances indicating that any of such conditions may
        not be capable of fulfilment.

        If the Panel requires Waterford Wedgwood UK to make an
        Offer for Royal Doulton Shares under the provisions of Rule
        9 of the City Code, Waterford Wedgwood UK may make such
        alterations to the terms and conditions of the Offer,
        including condition 1(a) of this Appendix 1, as are
        necessary to comply with the provisions of that Rule.

  2.    Further Terms of the Offer

        The Offer will lapse if it is referred to the UK
        Competition Commission before the later of 3.00 p.m. on the
        First Closing Date and the date on which the Offer becomes
        or is declared unconditional as to acceptances. If the
        Offer so lapses, the Offer will cease to be capable of
        further acceptance and persons accepting the Offer and
        Waterford Wedgwood UK will cease to be bound by forms of
        acceptance submitted on or before the time when the Offer
        lapses.

                             APPENDIX 2
                            DEFINITIONS

The following definitions apply throughout this document unless the context otherwise requires:



  "Act"                              the Companies Act 1985, as
                                     amended

  "Annual Report and Accounts"       the annual report and audited
                                     accounts of Royal Doulton for
                                     the year ended 31 December
                                     2003

  "Authorisations"                   authorisations, orders,
                                     grants, recognitions,
                                     confirmations, consents,
                                     licences, clearances,
                                     certificates, permissions or
                                     approvals

  "Cazenove"                         Cazenove & Co. Ltd

  "City Code"                        The City Code on Takeovers and
                                     Mergers

  "Enlarged Group"                   Waterford Wedgwood Group
                                     together with the Royal
                                     Doulton Group

  "Form of Acceptance"               the Form of Acceptance and
                                     Authority for use by Royal
                                     Doulton Shareholders in
                                     connection with the Offer

  "FSA"                              Financial Services Authority

  "Irish Stock Exchange"             The Irish Stock Exchange
                                     Limited

  "Irish Takeover Rules"             the Irish Takeover Panel Act
                                     1997, Takeover Rules 2001 and
                                     2002 (as amended) or any of
                                     them as the context may
                                     require

  "Lazard"                           Lazard & Co., Limited

  "Listing Rules"                    the listing rules of the Irish
                                     Stock Exchange and/or, where
                                     appropriate, the listing rules
                                     made by the UK Listing
                                     Authority under section 74 of
                                     the Financial Services and
                                     Markets Act 2000

  "London Stock Exchange"            the London Stock Exchange plc
                                     or its successor

  "LSE Admission Standards"          the rules issued by the London
                                     Stock Exchange in relation to
                                     the admission to trading of,
                                     and continuing requirements
                                     for, securities admitted to
                                     trading on the London Stock
                                     Exchange's market for listed
                                     securities

  "LTIPs"                            the Royal Doulton Incentive
                                     Share Plan and the Royal
                                     Doulton Long Term Incentive
                                     Plan 2003

  "Offer"                            the recommended offer made
                                     (outside the United States) by
                                     Lazard on behalf of Waterford
                                     Wedgwood UK and (in the United
                                     States) by Waterford Wedgwood
                                     UK to acquire all the Royal
                                     Doulton Shares (other than any
                                     Royal Doulton Shares held, or
                                     which become held, in treasury
                                     by Royal Doulton and the
                                     70,339,352 Royal Doulton
                                     Shares already owned by The
                                     Waterford Wedgwood Group) on
                                     the terms and subject to the
                                     conditions set out in the
                                     Offer Document and the Form of
                                     Acceptance including, where
                                     the context so requires, any
                                     subsequent revision,
                                     variation, extension or
                                     renewal of such offer and
                                     includes any election
                                     available in connection with
                                     it

  "Offer Document"                   the document containing and
                                     setting out the terms and
                                     conditions of the Offer

  "Official List"                    the official list of the UK
                                     Listing Authority

  "Panel"                            the Panel on Takeovers and
                                     Mergers

  "Regulatory Information Service"   any information service
                                     authorised from time to time
                                     by the UK Listing Authority
                                     for the purpose of
                                     dissemination of regulatory
                                     announcements required by the
                                     Listing Rules of the UK
                                     Listing Authority

  "Royal Doulton"                    Royal Doulton plc

  "Royal Doulton Deferred Shares"    deferred shares of 99p each in
                                     the capital of Royal Doulton
                                     to which no rights attach

  "Royal Doulton Directors"          the directors of Royal Doulton


  "Royal Doulton Group"              Royal Doulton, its
                                     subsidiaries and subsidiary
                                     undertakings and where the
                                     context permits, each of them

  "Royal Doulton Incentive Share     the Royal Doulton Incentive
  Plan"                              Share Plan adopted in 1993

  "Royal Doulton Interim Results"    the unaudited interim results
                                     of Royal Doulton for the six
                                     months ended 30 June 2004 as
                                     announced on 17 September 2004

  "Royal Doulton Long Term           The Royal Doulton Long Term
  Incentive Plan 2003"               Incentive Plan 2003 adopted on
                                     14 May 2003

  "Royal Doulton Shareholder(s)"     holders of Royal Doulton
                                     Shares

  "Royal Doulton Share Option        the Royal Doulton plc Share
  Plan(s)"                           Option Plan 2003 (approved and
                                     unapproved) adopted on 14 May
                                     2003 and the Royal Doulton
                                     Executive Share Option Scheme
                                     adopted on 8 November 1993

  "Royal Doulton Share(s)"           the existing unconditionally
                                     allotted or issued and fully
                                     paid ordinary shares of 1p
                                     each in the capital of Royal
                                     Doulton and any further shares
                                     which are unconditionally
                                     allotted or issued before the
                                     date on which the Offer closes
                                     (or such earlier date or
                                     dates, not being earlier than
                                     the date on which the Offer
                                     becomes unconditional as to
                                     acceptances or, if later, 14
                                     January 2005, as Waterford
                                     Wedgwood may decide) but
                                     excluding in both cases any
                                     such shares held or which
                                     become held in treasury

  "Royal Doulton Shares to which     all the Royal Doulton Shares
  the Offer relates"                 other than the 70,339,352
                                     Royal Doulton Shares already
                                     owned by The Waterford
                                     Wedgwood Group and any Royal
                                     Doulton shares held in
                                     treasury

  "Stock Units"                      the ordinary shares and
                                     "twinned" income shares in the
                                     capital of Waterford Wedgwood
                                     and Waterford Wedgwood UK
                                     respectively

  "subsidiary", "subsidiary          shall be construed in
  undertaking", "associated          accordance with the Act (but
  undertaking" and "undertaking"     for this purpose ignoring
                                     paragraph 20(1)(b) of Schedule
                                     4A of the Act)

  "UK" or "United Kingdom"           United Kingdom of Great
                                     Britain and Northern Ireland

  "UK Listing Authority"             the FSA acting in its capacity
                                     as the competent authority for
                                     listing under Part VI of the
                                     Financial Services and Markets
                                     Act 2000

  "US Person"                        a US person as defined in
                                     Regulation S under the US
                                     Securities Act of 1933, as
                                     amended and the rules and
                                     regulations promulgated
                                     thereunder

  "Waterford Wedgwood"               Waterford Wedgwood plc

  "Waterford Wedgwood Group"         Waterford Wedgwood and its
                                     subsidiary undertakings and
                                     where the context permits,
                                     each of them

  "Waterford Wedgwood Share(s)"      the existing Waterford
                                     Wedgwood ordinary shares of
                                     EUR 0.06 each in the capital
                                     of Waterford Wedgwood plc

  "Waterford Wedgwood UK "           Waterford Wedgwood U.K. plc, a
                                     subsidiary of Waterford
                                     Wedgwood

  "Wider Royal Doulton Group"        Royal Doulton and associated
                                     undertakings and any other
                                     body corporate, partnership,
                                     joint venture or person in
                                     which the Royal Doulton and
                                     such undertakings (aggregating
                                     their interests) have an
                                     interest of more than 20 per
                                     cent. of the voting or equity
                                     capital or the equivalent

  "Wider Waterford Wedgwood Group"   Waterford Wedgwood and
                                     associated undertakings and
                                     any other body corporate,
                                     partnership, joint venture or
                                     person in which Waterford
                                     Wedgwood plc and such
                                     undertakings (aggregating
                                     their interests) have an
                                     interest of more than 20 per
                                     cent. of the voting or equity
                                     capital or the equivalent

All times referred to are London time unless otherwise stated.

Euro exchange rate GBP 0.69 per EUR 1 as per the daily official list of the London Stock Exchange at 16.30, 13 December 2004.



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


            

Contact Data