Marel Food Systems hf. - Company Announcement

Marel changes currency of club loan from ISK to EUR

Marel has reached an agreement with Arion Bank, Íslandsbanki and NBI to change
the currency composition of the club loan facility that the banks provided the
company with in May 2009. According to the agreement, the entire ISK
denominated portion of the syndicated loan is changed to EUR, the company's
main revenue currency. The amount concerned is today equivalent to EUR 66 mln. 

More than 99% of Marel's revenues originate outside of Iceland and there is a
good currency balance between the company's revenues and costs. The company's
policy has been to finance its operations in its revenue currencies to the
maximum extent possible. Efforts have been made to systematically reduce
currency risk in the company's financing and to reduce interest cost. 

At the end of the third quarter of 2009, Marel's debts denominated in ISK
totalled EUR 130 mln. In the fourth quarter, new share capital totalling EUR 41
mln was issued, and investors were offered the possibility of paying for new
shares with bonds issued by Marel. Consequently, Marel was able to liquidate
61.8% of the bond class MARL 06 1 and 17.6% of bond class MARL 09 1, reducing
exposure to currency risk related to the ISK.  Now, ISK-denominated debt
equivalent to EUR 66 mln has been changed to EUR. As a result, Marel's
ISK-denominated debt now stands at approximately EUR 34 mln and the company's
interest cost and currency risk have been greatly reduced. 

Erik Kaman, CFO of Marel: 
“This is a very important step for Marel. This past year, we have
systematically worked to reduce the company's overall debt level through the
sale of non-core assets, improved operating cash flow  and an increase in share
capital. Most of the new share capital has been used to reduce the company's
ISK-denominated debt. Following the agreement with the Icelandic banks to
change the currency of loans from ISK to EUR, the greater part of Marel's
financing is now in the company's revenue currencies, in accordance with our
goals.” 



About Marel
Marel is the leading global provider of advanced equipment and systems for the
fish, meat and chicken processing industry. The company employs more than 3,500
people worldwide, and has offices and subsidiaries in over 30 countries, as
well as a global network of 60 agents and distributors.