REL: 1432 HRS Tower Limited  
TOWER will hold a Media Briefing today at 3.00pm NZ time (1.00pm AEST) and an  
Analysts Briefing at 4.00pm NZ time (2.00pm AEST) in relation to this  
announcement. Both briefings will be webcast live (audiocast with  
simultaneous slides)on the TOWER Limited website and an  
archive of the webcasts will be available to be accessed on demand shortly  
after the briefings finish.  
The announcement and the briefing presenation will also be posted on the  
TOWER Limited website.  
TOWER Limited Chairman Keith Barton announced today that a geographic  
separation of the New Zealand and Australian businesses is being recommended  
by the Board.  
Keith Barton said "We believe that a separation has the potential to create  
future value for TOWER shareholders because it will:  
1.1 Realise over time the potential underlying value of TOWER's Australian  
and New Zealand businesses by enabling each to focus on its own strategies  
for growth, with direct access to funding and capital markets as needed.  
1.2 Enable future investors to choose whether to invest in TOWER New Zealand  
or TOWER Australia, or both based on the investment characteristics that best  
meet their own objectives.  
1.3 Simplify the structure of both TOWER's Australian and New Zealand  
businesses making it easier to evaluate their performance and potential,  
resulting in a more accurate valuation of the true worth of each business  
Subject to shareholder approval, it is envisaged that separation will be by  
way of a demerger of the Australian business with a transfer of ordinary  
shares in the listed Australian business to existing TOWER shareholders and a  
consequent capital reduction in TOWER Limited, with the cancellation of an  
equivalent value of TOWER Limited shares held by existing shareholders. It is  
intended that the Australian company be listed on the ASX.  
In conjunction with this separation it is proposed that there will be a  
capital raising of between A$150-180m via a renounceable rights issue.  
Capital raised by TOWER Australia will be used to facilitate refinancing and  
reshaping of the existing group debt structures.  
Guinness Peat Group, TOWER's largest shareholder, supports the separation  
proposal and will underwrite the proposed renounceable rights issue. As with  
the separation proposal, this will also be subject to shareholder approval.  
If the proposal proceeds, immediately following the separation, TOWER Limited  
shareholders will:  
- continue to hold shares in TOWER Limited (the TOWER New Zealand business  
- be issued with shares in the Australian business group to be called TOWER  
Australia Group Limited, and  
- be issued renounceable rights to subscribe for additional shares in the  
Australian group.  
TOWER Group Managing Director Jim Minto said "This proposal will allow the  
Boards and management to focus on their respective operations and I believe  
will over time lead to better performance of each entity. I do not believe  
that the separation process will impact adversely on clients, business  
partners or business arrangements in either New Zealand or Australia. The  
outcome will be a further strengthening and focussing of TOWER through two  
separately listed businesses which will benefit not only shareholders but  
also our clients and business partners."  
Mr Minto said "Our TOWER NZ and Australian business are very different in  
their characteristics and business operations. They don't depend on one  
another operationally or gain natural synergies from working together. TOWER  
successfully operated as a purely NZ business for over 100 years from 1869 to  
1990 and it will enter a new period as a focussed NZ business. The Australian  
company will focus its efforts on being Australian market leader as a pure  
Life risk provider with a niche investment business".  
TOWER Group Managing Director Jim Minto will under the proposal become Chief  
Executive Officer of TOWER Australia Group Limited with John de Zwart current  
Group Chief Financial Officer taking the Chief Financial Officer role of the  
listed Australian Company. A Chief Executive Officer appointment for the  
overall New Zealand business is in the process of being finalised. Existing  
business line Chief Executive Officer positions will be unaffected.  
From the separation the Chairman of TOWER NZ Limited will be Tony Gibbs an  
existing TOWER Limited Director and the Chairman of TOWER Australia Group Ltd  
will be Keith Barton the existing TOWER Limited Chairman.  
The proposed timing of the demerger is as follows:  
- Scheme book sent to shareholders mid October  
- Shareholders vote on Scheme November  
- Implementation of demerger November  
- Renounceable rights issue December  
TOWER expects to lodge the Scheme documents with the regulatory bodies in  
late September 2006 and accordingly will be in a position to provide further  
details regarding the proposal at that time.  
Under the proposal, TOWER is considering making offers of securities referred  
to in this announcement. No money is currently being sought and applications  
will not be accepted nor money received until shareholders have received a  
Prospectus/Investment Statement.  
Caliburn Partnership is advising TOWER.  
For more information Jim Minto  
Group Managing Director  
Ph 0064 9 369 2274  
End CA:00135103 For:TWR Type:GENERAL Time:2006-08-08:14:32:07  

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