AS Silvano Fashion Group („Silvano”) is a wholly owned subsidiary of PTA Grupp AS („PTA”). Acquisition of Silvano by PTA took place by share swap transaction, where PTA used its own shares as the means of payment for Silvano share. 36,000,323 new PTA shares were issued in the course of the aforementioned transaction, subscribed by the shareholders of Silvano. As a result of this transaction, the shareholders of Silvano acquired approximately 94.9% of the shares in PTA. PTA disclosed all information concerning the aforementioned transaction in a number of stock exchange releases (for example, the stock exchange releases published on the 28th and 29th of August and 17th of November 2006). Transaction was carried out according to the principle of so-called „reverse takeover”, where actual result of transaction lies in the acquisition of majority stake of PTA by the shareholders of Silvano. In connection with the merger between PTA and Silvano a listing and trading prospectus of PTA shares was prepared and it was published on the 9th of November 2006. This transaction brought along the establishment of essentially new group, which main areas of activity are the production and sale of lingerie and women's clothing in Baltic States and other Eastern European countries. Need for restructuring The strategy of the new group foresees centralised management of the group's main processes, which will be carried out at the level of holding company listed in Tallinn Stock Exchange. Grouping the strategical management functions to the level of holding company listed in stock exchange warrants a better transparency and higher effectiveness of management structure. Group management is currently carried out at two levels: the Management Board of PTA is responsible for the development of PTA brand (including the monitoring of management of AS Klementi and other subsidiaries of PTA, except Silvano Fashion Group AS), whereas the Management Board of Silvano is responsible for strategical management of the subsidiaries of Silvano (SP ZAO Milavitsa, AS Lauma Lingerie, ZAO Linret and Splendo Polska Sp. z.o.o.). According to the listing and trading prospectus of the shares of PTA (see „Combined Management”, p 66 of the prospectus), an international team will be established for the management of the whole group and its members will belong to the management board of the holding company listed in Tallinn Stock Exchange In order to implement the aforementioned plan, certain changes in the group structure should be made. The changes in the group structure are described below. Restructuring plan In the course of restructuring a redundant holding company will be eliminated (AS Silvano Fashion Group) and PTA Grupp AS listed in Tallinn Stock Exchange will concentrate exclusively on the strategic management of the group. In order to separate the current business activities of PTA (organisation of retail sale of the products of PTA concept) from strategic management of the group, PTA Grupp AS will establish a new subsidiary. As a result of the restructuring, PTA Grupp AS will be renamed AS Silvano Fashion Group. Following changes will take place during restructuring: AS Silvano Fashion Group will merge with PTA Grupp AS; The present AS Silvano Fashion Group as a legal person will be terminated upon the merger of the company with PTA Grupp AS and the new business name of PTA Grupp AS will be AS Silvano Fashion Group; A new subsidiary will sever from PTA Grupp AS (with a new business name AS Silvano Fashion Group), which will be called PTA Grupp AS. The new subsidiary will take over all the business activities connected with the development of PTA concept, shares of AS Klementi (a production entrepreneur of PTA concept) and other subsidiaries of PTA, which existed before acquisition of Silvano; Membership of the Management Board of PTA Grupp AS (with new business name AS Silvano Fashion Group) will change according to the rules described in the listing and trading prospectus of the shares of PTA. The restructuring plan is illustrated in the appendix to the present stock exchange release (available in information system of sock exchange), describing the group's structure before and after the restructuring. Influence and implementation of restructuring Changes in the group's structure will not affect its economic activities and the interests of its investors (with the exception of positive influences connected with a better transparency of the structure). The aforementioned restructuring will take place in the second quarter of 2007. A notarised merger agreement between PTA and Silvano was signed today, according to which Silvano will be merged with PTA and deleted from the commercial register. Pursuant to § 421 (4) of the Commercial Code, approval of the merger resolution by general meeting of shareholders of PTA is not necessary, provided that (i) at least one month before deciding on approval of the merger agreement by Silvano, the Management Board of PTA has published a notice concerning entry into the merger agreement and has presented the documents specified in the Commercial Code to the shareholders of PTA for examination and (ii) approval of merger resolution is not demanded by shareholders whose shares represent at least 1/20 of the share capital, and the articles of association do not prescribe a lower representation requirement. Division plan of PTA Grupp AS (with new business name AS Silvano Fashion Group) was also approved today. According to the division plan, all the business activities connected with PTA brand will be transferred to the new subsidiary that will be called PTA Grupp AS. Division plan is also subject to the approval by the general meeting of shareholders of PTA. PTA will publish a separate stock exchange release regarding the general meeting of shareholders and relevant materials. Peeter Larin PTA Grupp AS Chairman of the Management Board Tel +372 6 710 700