ACN Advance Capital

RNS No 8851h
ACORN GROUP PLC
19th November 1998


Further to the announcement by Acorn on 17th September 1998 of the results of
its strategic review and the implementation of its restructuring programme the
board now believes it appropriate to update the market as to progress in these
areas.

Acorn's continuing businesses are now carried out through its 100% subsidiary,
Acorn Computers Limited ("ACL") which, in turn, holds 50% of Xemplar Education
Limited.  ACL was restructured in September 1998 to significantly improve its
financial performance and to focus its technologists on the market for high
performance digital TV solutions.  This restructuring involved the reduction
in employee numbers from 175 to 110 and has allowed the company to achieve a
significant reduction in ACL's monthly cash burn.  Xemplar is a profitable
50/50 joint venture company with Apple Computer.

In addition to its remaining businesses, Acorn retains a holding of 11.6
million shares in ARM Holdings plc which, based on the closing bid price on 18
November 1998 of 930p, has a market value of approximately #108 million.  The
Acorn board is continuing to examine structures for separating the ARM shares
from the remaining Acorn businesses and is examining the tax treatment of any
separation with a view to protecting the after tax value of the ARM shares for
Acorn shareholders.  The tax treatment of the methods of separation being
considered is currently uncertain and there is a possibility that the board of
Acorn will be unable to structure the separation without incurring a tax
liability.

If this proves to be the case the effect of the contingent or actual tax
liability, based on the current ARM share price, would reduce the after tax
value of Acorn's investment in ARM to approximately #74 million (equivalent to
approximately 80p per Acorn share).  

The Board of Acorn has a clear intention to separate ACL from Acorn at the
earliest opportunity in order to allow the ACL business to be financed as a
stand alone entity and to permit the return of the investment in ARM shares,
or an equivalent value, to its shareholders.  


END

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