Hüvitusfond                   NEWS RELEASE                      10/29/2002



INCREASE IN SHAREHOLDING AND DELIVERY OF ASSETS



Compensation Fund’s shareholding in its subsidiary AS  Werol

Tehased  increased  as  a result of last  stock  issue  from

92,49% to 98,06%.



On  September  24, 2002, the general meeting of shareholders

of  AS  Werol  Tehased decided to increase  company’s  share

capital by 86 050 000 kroons, issuing 8 605 000 shares  with

nominal  value  of  10  kroons. Increase  of  share  capital

results from need to improve company’s capital structure and

strengthen  its  abilities  to  fulfil  its  obligations  to

creditors.



Subscription period was from September 24, 2002  to  October

8,  2002,  and  was prolonged by decision of the  management

board  by 15 days. Compensation Fund subscribed all issuer’s

shares  under subscription, other shareholders Lõunatööstuse

AS,  Vector Pluss OÜ and Veland Varad AS did not participate

in the subscription.



As  a  result of last stock issue share capital of AS  Werol

Tehased  increased by 86,05 million kroons to 116,05 million

kroons. After the stock issue Compensation Fund owns 98,06%,

Lõunatööstuse AS 0,56%, Vector Pluss OÜ 0,82% and AS  Veland

Verad 0,56% of share capital of AS Werol Tehased.



With  new  funds obtained by stock issue, AS  Werol  Tehased

decreased its obligations to creditors by paying back  loans

taken  from Compensation Fund in the amount of 66,05 million

kroons.



Due  to  decision of Government of Republic  of  Estonia  of

October 8, 2002, and according to the Act on Liquidation  of

Compensation Fund, Compensation Fund will deliver shares  of

AS  Werol  Tehased to the state by November 15,  2002.  This

would be the first delivery of assets to an administrator of

state  assets,  who  in  this  case  would  be  Ministry  of

Agriculture, as determined by the Government.





Jaanus Kosemaa

head of public relations

6651800, 05104614