Press Release from the Iceland Enterprise Investment Fund

The year 2011 was the second year of operation of the Iceland Enterprise Investment Fund; the Fund’s profit from operations amounted to ISK 2,343 million, as compared to ISK 700 million in the preceding year. Total assets at year-end amounted to ISK 28.2 billion, as compared to ISK 5.6 billion in 2010. Equity stood at ISK 27.5 billion at year end, and the equity ratio at 97.9%.

The Fund’s shares in undertakings are entered at cost price, apart from shares in listed companies, which are entered at market value. The Fund’s profit over the year is the result of an increase in the market value of Icelandair Group. In co-operation with its auditors the Fund has assessed the fair value of the shares in which the Fund has invested, and the resulting figure has been established at a minimum figure of ISK 39.3 billion. The estimated fair value is based on the results of impairment tests of underlying assets.

At the beginning of 2011 the Fund’s holdings in Icelandair Group represented the Fund’s only equity holdings. Over the year, holdings in a total of seven companies were added to the Fund’s portfolio. The new companies are Advania, Húsasmidjan, Vodafone, N1, Icelandic Group, Plastprent and Promens. In the course of the year, the Fund also sold interests in two companies. A 10% share in Icelandair Group was sold, leaving the Fund with a 19% share in Icelandair Group. The Fund then sold the assets and operations of Húsasmidjan and now no longer holds any shares in that company.

Thorkell Sigurlaugsson, Chairman of the Board of the Enterprise Investment Fund: The year 2011 was an eventful year for the Iceland Enterprise Investment Fund. Since its foundation, the Fund has played a significant role in the refinancing, reorganisation and restructuring of a number of key undertakings which were largely in the ownership of banks; the Fund has certainly performed well in the role that it was assigned.  The Fund’s portfolio is of extremely good quality, and it can be argued that its financial position is even better than indicated by its book value. The assessed fair value of the shares held in the portfolio is approximately 39.3 billion, while the book value of the same assets is 27.2 billion.  The difference reflects the results achieved in the Fund’s investment activities.”

Further information:

Pétur Th. Óskarsson, Iceland Enterprise Investment Fund, mobile tel. +354-863-6075

Information for editorial staff:

On the Iceland Enterprise Investment Fund slhf.

The Iceland Enterprise Investment Fund is owned by sixteen pension funds, Landsbanki hf. and VÍS. The Fund specialises in investments and business development. The role of the Fund is to participate in the reconstruction of the Icelandic economy and to invest in line with the Fund’s investment strategy. The Chairman of the Board of the Iceland Investment Fund is Thorkell Sigurlaugsson, and the Managing Director is Brynjólfur Bjarnason.

The Iceland Enterprise Investment fund currently has holdings in seven companies:

Company:

Holdings:

Advania

75%

Icelandair

19%

Icelandic Group

100%

N1

16%

Plastprent

100%

Promens

49.5%

Vodafone

79%