2007-12-13 08:30:00 CET

2007-12-13 08:30:00 CET


REGULATED INFORMATION

Kesko Oyj - Company Announcement

Indoor Group to increase efficiency of operations and concentrate on Finnish and Baltic markets


KESKO CORPORATION STOCK EXCHANGE RELEASE 13.12.2007

Indoor Group to increase efficiency of operations and concentrate on Finnish
and Baltic markets 

Indoor Group Ltd, part of the Kesko Group, will start an extensive development
programme, which aims to strengthen the company's market position in the home
furniture and interior decoration retailing in Finland and the Baltic
countries. At the same time Indoor Group will divest its operations in Sweden.
Divestiture costs are expected to lower Indoor Group's profit for this year by
about 4 million euros. The divestiture will be treated as a non-recurring item,
and it will have no effect on the future outlook previously published by Kesko. 

In order to increase the customer satisfaction and competitiveness of its
chains in Finland Indoor Group will improve its chain brands, marketing,
logistics and chain management. Next year Asko will celebrate its 90th
anniversary by strengthening the role of Finnish furniture designers in the
collection development and highlighting young talented designers. A new special
collection and product families will be launched to the market. 

Due to the plan to increase the efficiency of operations in Finland and to
divest the business in Sweden, Indoor Group will start rationalisation
negotiations in its domestic units. The estimated need for redundancies in
Finland is approximately 50 employees. During the procedure, placement
opportunities of the employees within the Kesko Group will be established. A
significant proportion of staff reductions will be achieved through the
termination of fixed-term employments. The rationalisation negotiations are
expected to be completed by the end of January. 

Indoor Group has had three stores in the greater Stockholm area. The operations
of the outlet at Kungens Kurva ended on 10 December 2007 due to the termination
of the lease. The operations of the outlets at Barkarby and Länna will end by
30 May 2008. The total number of employees in these two stores is about 50. 

With its chain concepts, Indoor Group is the leading home furniture and
interior decoration retailer in Finland, where the Asko and Sotka chains
comprise a total of 85 stores. The organisational arrangements and
rationalisation activities aim to further strengthen the company's position as
the market leader in Finland. The company will also continue to expand its
business in the Baltic countries. Currently it has six stores in Latvia and
five stores in Estonia. 

Further information:
President Pasi Mäkinen, Indoor Group Ltd, tel. +358 3 554 3512