KESKO TO BUILD A CHAIN OF FOUR HYPERMARKETS IN LATVIA

Next summer Kesko will open a grocery store with a floor area of about 6,000 square metres in Riga, the capital of Latvia. The purpose is to open four hypermarkets in Riga within two years.

A commercial centre of about 20,000 square metres - the largest one in Latvia - to be opened next summer will be built by a construction alliance formed of Merko, Latvia, and SRV, Finland. Kesko’s share of the investment is about FIM 40 million (about EUR 6.7 million). The sales target of the first hypermarket is about FIM 100 million (about EUR 17 million), and it will employ about 100 persons. The sales target for 2003 is about FIM 500 million (about EUR 84 million).

These new stores of Kesko aim to offer the widest selection of groceries in the Riga area, at reasonable prices and by providing good service. With regard to traffic, the stores will be located on the best places.

Kesko aims to obtain a 20-25% share of the Baltic markets. In Estonia, Kesko opened a SuperNetto store in Mustamäki, Tallinn in May 2000. The next stores will be opened in Tartu and Pärnu in the spring of 2001. A logistical centre providing services to the whole Estonia will be opened to the west of Tallinn in December 2000.

Kesko also owns Ehitusmaailm, which is the largest hardware store chain in Estonia and operates five hardware stores in Estonia and one in Latvia. In addition, Kesko carries on agricultural trade in all Baltic countries.

Harri Sivula, Vice President, Foodstuffs Division, telephone +358 1053 22213.

Matti Hukka, Director, telephone +358 1053 23071.

Ari Svensk, Managing Director, SIA Kesko Food Latvia, telephone +358 1053 22661.