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Electronics Production | December 31, 2005

Elcoteq sells German plant

Elcoteq will divest its German subsidiary Elcoteq Elektronik GmbH and the manufacturing plant in Überlingen, Germany, to the German company Rafi GmbH & Co. KG. The enterprise value of the divested subsidiary is approximately 6 million euros.
The divestment of the plant will not affect Elcoteq's 2005 result. The transaction will take place on December 31, 2005.

The Überlingen plant has a total floor space of 5,200 square meters and roughly 160 employees, who will continue to be employed by Rafi retaining their existing employee status. The plant's net sales in 2005 total approximately 25 million euros.

Elcoteq acquired the Überlingen plant at the end of 1999 and initially it had an important role in Elcoteq's expansion strategy in Central Europe. In 2003 Elcoteq acquired Marconi's Offenburg plant in Germany, after which some operations at Überlingen have been moved to Offenburg and also partly to Elcoteq's other European plants. Hence the strategic importance of the Überlingen plant in Elcoteq's service network has substantially decreased.

"Überlingen's role in Elcoteq's plant and service network has declined significantly over the past two years. We are centralizing the operations and services we need in Germany at our Offenburg plant. We are happy to have found a buyer for our Überlingen unit that will continue and develop the plant for its own needs in Germany," says Mr Jukka Jäämaa, COO, Elcoteq SE.

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