Scanfil to cease operation in Belgium

Scanfil Plc's Belgian subsidiary Scanfil N.V. announced to the representatives of the company's personnel on 17 January 2006 their intent to reorganize operations of the company, and that this reorganization might lead to reduction of personnel. The possibility of winding down the entire production of the plant would also be discussed during the negotiations. At the same time, the company announced that they will start a communications and negotiations procedure with the representatives of the personnel groups as put forth in Belgian law. Based on the final result of the negotiations, Scanfil N.V.'s Board of Directors has decided to start winding down production of the plant. In the future most of the products manufactured at the plant will be manufactured in lower cost level plants of Scanfil Group. It has been estimated that the costs of the personnel reorganization will be ca. EUR 7.6 million as a single cost item instead of EUR 6 million as was estimated in Stock Exchange Release on 17.1.2006. At the moment, no notable costs are expected from the production transfers. The plan is to conclude most of the actions during the first half of the year 2006.