Entry in the court register of the merger of KD Naložbe d.d. into KD Holding d.d.

In accordance with the provisions of the Rules of the Ljubljana Stock Exchange d.d. and the ZTVP-1 (Official Gazette of the Republic of Slovenia, No. 56/99), KD Group, d.d., Ljubljana, hereby issues the following announcement:

KD Holding, finančna družba, d.d., Celovška 206, Ljubljana, hereby informs the public that on 27 October 2004, the merger of KD Naložbe, a financial company, d.d., Ljubljana, to the acquiring company KD Holding, a financial company, d.d., Ljubljana,

was entered in the court register at the District Court in Ljubljana under number Srg 2004/08127. As of the date of entry of the merger, KD Naložbe d.d. ceases to exist as a legal entity.

At the same time as the merger was registered, an increase in the share capital of KD Holding, resulting from the merger, was also entered in the court register, namely to an initial amount of 13,119,576,000.00 SIT. To cover the increase in share capital, the acquiring company, KD Holding, will issue a maximum of 448,565 new ordinary shares (ticker symbol KDHR) with a nominal value of 8,000.00 SIT per share, which are traded on the open market of the Ljubljana Stock Exchange.

The Management Board of KD Holding has already issued an order to KDD – Central Clearing and Depository Company, d.d., Ljubljana (KDD), an order to exchange the shares of the acquired company, KD Naložbe (PDKR), for shares of the acquiring company, KD Holding (KDHR). KDD will exchange the newly issued KDHR shares for PDKR shares on the record date, which is the eighth day following the date on which KDD received the decision on the entry of the merger in the court register. Shareholders who are recorded in the share register as holders of PDKR shares on that date will, in accordance with the resolution adopted at the 5th General Meeting of Shareholders on 20 August 2004, have their shares exchanged at a ratio of 1:0.05. For shares where the number is insufficient to issue a single new share (up to a maximum of 19 shares), shareholders will receive a cash payment at a value of 536.31 SIT per share.

Following the share exchange in connection with the merger, the Supervisory Board of KD Holding d.d., in accordance with the authorisation granted by the 5th General Meeting of Shareholders of KD Holding, amend the text of the Articles of Association to reflect the final amount of the share capital increase and the final number of newly issued ordinary shares of KDHR.

In accordance with the provisions of Article 522 of the Companies Act, KD Holding d.d. hereby further informs and notifies the creditors of both companies involved in the merger that they have the right, within six months of the publication of the entry of the merger in the court register, to demand security for their due, uncertain or contingent claims. They may exercise this right only if they can demonstrate, on a prima facie basis, that the satisfaction of their claims is at risk as a result of the merger.



KD Holding d.d.
Management Board