Atria offers Swedish Meats a true partnership

28.11.2006 08:00
Atria offers Swedish Meats a true partnership

Atria Group plc offers Swedish Meats Cooperative a true partnership and a growth
focused industry driven arrangement. Atria proposes to acquire the processed
meats operations (e.g. relevant operations of Scan, SLP Pärsons, Esca and
Skånekött) from Swedish Meats Cooperative with a target of combining the
processed meat businesses of Swedish Meats and Atria Sweden (Lithells) and
simultaneously offers Swedish Meats an ownership with significant influence in

Atria's proposal enables Swedish Meats owners maintaining control and ownership
of the key business of Swedish Meats Cooperative including the slaughtering and
cutting operations. As an additional matter, in case Swedish Meats sees this
desirable, to deepen the proposed partnership Atria is prepared to invest in a
minority share of up to 20% in the slaughtering and cutting operations.

Atria has a strong interest in developing its Swedish operation, which currently
has a number 2 position in terms of turnover in processed meats in the Swedish
meat market with well known brands of Lithells and Sibylla. Swedish Meats'
processed meat operations are market leading with Scan brand. The proposed
transaction would create the market leader in processed meats in Sweden the
estimated combined turnover of which in processed meats would be approximately
SEK 5.5 billion.

The background to this offer is that according to Swedish and Finnish public
sources there has been a lively debate about the future ownership arrangements of
Swedish Meats.

The proposal for the processed meats operations that has been left for Swedish
Meats' consideration consists of the following key financial elements:

- Cash payment of SEK 851,000,000;
- Issue of 2,300,000 preferred class A shares of Atria (1 vote/share), which
shall be listed on the Helsinki Stock Exchange subsequent to the Transaction; and
- Issue of 396,000 non-listed ordinary class K II shares of Atria (10

The purchase consideration on enterprise value basis totals approx. to SEK 1,3
billion assuming that non-listed ordinary class K II shares are valued similarly
to publicly traded class A shares. With the above purchase consideration Swedish
Meat Cooperative's share of all the shares in Atria would be approx. 10.8 % and
its share of all the votes in Atria approx. 5.6 %.

Additionally Atria has proposed that a long-term framework agreement with Swedish
Meat's on supply of raw material would be executed and that Swedish Meats
Cooperative would have a representative in the Board of Atria subject to
approvals from relevant bodies.

Atria sees that this alternative partnership proposal has several important
benefits to a Swedish Meats owner as the proposal includes e.g.:

- Maintaining control and ownership of the key business of Swedish Meats
Cooperative including the slaughtering and cutting operations;
- Significant influence through high voting share in Atria;
- Participation in potential value increase through significant synergies through
combining the strength of the two Sweden based businesses; and
- Export opportunities through Atria's growing new markets where Atria is net
importer of meat, especially Russia.
- Disposal of the processed meat operations which need structural changes and
investments in a situation where Swedish Meats has been looking for a way to
drive the industrial part in a profitable way for both company and suppliers.

Atria believes that its proposal on this alternative partnership, which is
initially valid until 31 December 2006, provides with an attractive overall
financial and strategic outcome both in short and long-term for Swedish Meats'
owners and Atria.

For further information, please contact Mr. Matti Tikkakoski, President and CEO
of Atria Group plc, tel. +358 50 2582 or Mr. Christer Åberg, MD of Lithells AB,
tel +46 7039 06100.

Matti Tikkakoski
President and CEO

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