Market announcement

Title

Establishing subsidiaries

Message

Three new subsidiaries have been established for the purpose of improving the
structure and making the administration of the group of Tallinna Kaubamaja more
transparent. 

Tallinna Kaubamaja AS has established two subsidiaries. First of them is the
subsidiary Kaubamaja AS which is owned 100% by Tallinna Kaubamaja AS and has a
share capital consisting of 250 ordinary shares with a nominal value EUR 100
comprising a share capital of EUR 25,000. Tallinna Kaubamaja AS plans by
separate and divide the company in order to transfer the business of the
department stores in Tallinn and Tartu, that have been a part of the group up
to the present moment, into Kaubamaja AS. Erkki Laugus who has been working in
the group since 2005 was elected to be a member of the management board of
Kaubamaja AS. In the years 2009-2011 Erkki Laugus was managing the group’s
subsidiaries ABC King AS and Suurtüki NK OÜ in the shoe business, since 1 June
2011 he has been the managing director for the department stores’ business. The
members of the parent company’s supervisory board and additionally the parent
company’s management board member Raul Puusepp were elected to the supervisory
board. 

A second subsidiary of Tallinna Kaubamaja AS, Topsec Turvateenused OÜ, was
established with a share capital of EUR 2,500 whereas Tallinna Kaubamaja AS has
a 100% shareholding in the company. The purpose of establishing Topsec
Turvateenused OÜ and handing over the security business in the course of the
separation and division of Tartu Kaubamaja AS is to highlight the fast growing
and prospective security business of the group that has been part of the
business of Tartu Kaubamaja AS up to the present moment. Tannar Tiitsar who has
been working in the group since 2004 and has been managing the security
operations has been elected to be the member of the management board of Topsec
Turvateenused OÜ. 

Selver AS, a subsidiary for Tallinna Kaubamaja AS has established a subsidiary
Kulinaaria OÜ with a share capital of EUR 2,500 whereas Selver AS has a 100%
shareholding in the company. In the course of the division Selver AS has
planned to separate the business activities of the central kitchen and transfer
it to Kulinaaria OÜ in order to continue the business in the new company.
Kulinaaria OÜ will carry out the activites of the central kitchen of Selver AS,
it plans to grow the share of export and subcontracting activities, it will
develop the party catering and e-commerce lines, and it will continue to supply
retail stores with prepared meals. Andres Heinver who has been in the group of
Tallinna Kaubamaja AS since 2008 and Kristi Lomp who is in charge of the sales
processes of Selver AS have been elected as the members of the management board
of Kulinaaria OÜ. 

Tallinna Kaubamaja AS as the group’s parent company will hereafter concentrate
on managing the subsidiaries and investments and on arranging the group’s
support services. 

Today, on 22 June 2012 Kaubamaja AS was registered in the commercial register
and yesterday, on 21 June 2012 Kulinaaria OÜ and Topsec Turvateenused OÜ were
registered in the commercial register. Establishing the subsidiaries and
reorganizing the structure of the group has no impact on the consolidated
financial results. Establishing the subsidiaries does not constitute an
acquisition of a significant holding in the meaning of the section
“Requirements for Issuers” in the NASDAQ OMX Tallinn rules, nor does it have
substantial influence on the operations of the Tallinna Kaubamaja AS group. The
supervisory and management board members of Tallinna Kaubamaja AS have no
personal interests in these transactions. 


         Raul Puusepp
         Chairman of the Board
         Phone: +372 731 5000