Realises ISK 26 billion profit.

• FL Group has secured the sale of its entire shareholding in Icelandair Group. The estimated profit from the sale will be around 26 billion ISK (EUR 305 million) based on the book value of Icelandair Group at the end of June 2006.
• Estimated proceeds from the sale amount to around ISK 35 billion (EUR 410 million)
Icelandair Group due diligence has been finalised
• Three groups of investors have acquired a majority of Icelandair Group shares.
• Glitnir banki hf. will underwrite the remaining shares in Icelandair Group owned by FL Group. Glitnir banki hf. has already allocated 16% of that shareholding to other investors, employees and key management of Icelandair Group.
• Key management of Icelandair Group intends to acquire up to 4% of the company shares.
• All Icelandair Group employees will have the opportunity to buy shares in the company and 4% of total shareholding has been reserved for this purpose.
• Up to a third of Icelandair Group shares, will be offered to investors and the general public in a public offering (IPO), managed by Glitnir banki hf.

Three groups of investors have acquired 50.5% of the shares in Icelandair Group. The groups are:

1. Langflug ehf. (mostly owned by Samvinnutryggingar hf.) with a 32% share.
2. Naust ehf. (mostly owned by BNT hf.) with 11.1% share.
3. Blue-Sky Transport Holding (mostly owned by Ómar Benediktsson) with 7.4% share.

Glitnir banki hf. has furthermore allocated up to 16% of shares to other investors and employees of Icelandair Group. This means that around 67% of shares are already allocated.

A public offering of shares in Icelandair Group will take place prior to the company’s listing. In the offering institutional investors and the general public will be able to subscribe for shares in Icelandair Group. A total of up to a third of Icelandair Group shareholding will be offered. Further details of the process will be revealed at a later stage.


Hannes Smarason, CEO of FL Group: “The great interest of the investor community in Icelandair, made FL Group able to sell all its shares. This is in accordance with Icelandair Groups strong position and solid operations. FL Group is realising a substantial profit from the sale of Icelandair Group and this transaction creates significant flexibility for further investments for FL Group. We have emphasized the importance that Icelandair Group, the country’s most important aviation and tourism company, and a leading international player in the airline industry, will come into public hands.”

Jon Didrik Jonsson, Managing Director of Investment Banking in Glitnir: “We expected strong interest from investors for Icelandair Group, and are very pleased that this has indeed been the case. Glitnir has already allocated the 51% shareholding the Bank underwrote two weeks ago and has secured another 16% to be allocated to other investors and employees of Icelandair Group. Hence, a total of 67% of all shares in the company has been allocated already. This interest is a strong indicator for a successful IPO process.”

Jon Karl Olafsson, CEO of Icelandair Group: “The management of Icelandair Group supports the plan to list the company on the Icelandic Stock Exchange and is looking forward to the opportunity such a listing offers. The fact that management intends to acquire up to 4% of the shares in Icelandair Group is a clear indicator of our faith in the company . The goal of a listing is to bring a broad group of institutional and private investors to the company and to strengthen the special bond the company has with the general public. I am also very pleased that all Icelandair Group employees will have the opportunity to purchase shares in the company, as a part of the agreement between Glitnir and FL Group.”