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Samas sale of German + Central & Eastern European operations leaves Company as a shell

Thursday 2 July 2009

Samas NV (Samas) has reached final agreement with a consortium consisting of the German financial investor Innovation Change GmbH (Berlin) and local management on the divestment of its German and Central & Eastern European operations. Samas Germany will continue its activities as a whole on a standalone basis. On 19 June 2009, the intended divestment of the German and Central & Eastern European operations was approved by the shareholders. The process is executed in close consultation with Samas’ lending banks and with current credit arrangements under review.

Carl-Christoph Held, chairman of the Executive Board and CEO of Samas:
“Given our very tight financial household, the lack of available external funding and the lack of a potential buyer for Samas as a group, the sale of our German operations and our smaller scale operations in Central and Eastern Europe is the best strategic alternative going forward in order to secure continuity of these activities. The deal provides the local operations with funding to implement their plans and further improve their business. Although inevitable, it is still a highly unfortunate move for Samas as a group and its shareholders. Therefore, we would like to express gratitude for their understanding of the situation and approval of the intended divestment at the recently
held shareholders’ meeting. Also, having worked for Samas Germany for many years, before joining the Samas NV Executive Board, I am proud of how Christian Nawin as Managing Director and his team have handled this complex transaction and are steering their company through these challenging times. I wish them all the best for the future.”

Christian Nawin, Managing Director of Samas Germany:
“Through this deal we have gained access to funding for working capital and required restructurings and created a new future for Samas Germany. We are pleased with the investor consortium and believe they are able to contribute significantly to our business. In addition, we would like to thank our local government for the constructive and supportive role they have played in this process. We now have the ability to build a new and strong German office furniture company headquartered in Worms. We plan to continue cooperation with other former Samas entities in order to serve both Samas Germany’s national and international customers with office furniture solutions. We are convinced this deal will boost our clients\' and suppliers\' confidence to cooperate with us and to continue and further improve our business of creating innovative and contemporary office solutions focused on how
we envisage the future of work.”

Background and consideration
Samas Germany which includes the operations in Central & Eastern Europe, markets a number of leading office furniture brands each of which targets a specific market segment. The brands include Drabert, Falpro, Fortschritt, MBT, MARTINSTOLL, Nick, and Schärf. The transaction comprises the sale of 94% of the shares in Samas Germany and includes the transfer of corresponding share of the assets to the consortium; the remaining part of the shares is expected to follow in due course. The deal also includes the transfer of the existing conditional option to acquire the Central & Eastern European operations, as granted to one of the consortium partners which bought the Benelux operations, implying that this option will remain in tact.

The total consideration amounts to approximately 20 million, 90% of which consists of the transfer of locally allocated bank debt. The value and financial implications of the transaction are in line with the valuation incorporated in the preliminary (unaudited) annual results as published on 12 June 2009 and discussed in the Extraordinary General Meeting of Shareholders on 19 June 2009.

In the financial year 2008/2009, the pro forma (unaudited) turnover of Samas Germany and Central & Eastern Europe declined by 6% year-on-year to 179.6 million. The pro forma (unaudited) normalized operating loss came in at 3.7 million. The transaction involves a transfer of approximately 1,000 FTEs (Full Time Equivalents), of which 800 FTEs in Germany and 200 FTEs in Central & Eastern Europe.

Additional funding has been provided to Samas Germany by a local German bank, backed up by support from local government. The investor consortium which acquired Samas Germany will seek to complete an already prepared refinancing in the coming months.

The sale of the German and Central & Eastern European operations was enabled through the approval by Samas’ shareholders of the intended divestment at the shareholders’ meeting held
on 19 June 2009, for which Samas wishes to express its gratitude. As earlier indicated, no payout to shareholders is foreseen.

About Innovation Change
Innovation Change GmbH is a Berlin (Germany) based investment holding driven by Worms born entrepreneur Harald Christ and his business partners Paul A. Vorsteher, Dr. Mathias Hiebeler and Max Rauch. Innovation Change is supporting German Small and Medium-sized Enterprises (SMEs) to overcome the present crisis by providing creative business solutions and hands-on support with regard to crisis management, interim financing and restructuring measures.

Harald Christ, founder and chairman of Innovation Change:
“Small and Medium-sized Enterprises represent the blood circulation of the German economy. We have to make sure that this circulation stays in tact. In case of Samas Germany it is our objective to safeguard continuity
of this traditional employer in the Rheinland-Pfalz region and to strengthen its market leading position with strong office furniture brands via a long term strategic investment.”

Next steps
Following the divestment of its German and Central & Eastern European operations, Samas will be reduced to a listed holding company with no operating activities. Further updates to the market regarding Samas NV, such as the annual results and the annual report will be provided in due course.

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