KALEV                           ANNOUNCEMENT                        07.12.2004



Shareholder drops suit



On Friday, 3 December 2004, AS Kalev received a Tallinn  City  Court  decision  in

which the court ended proceedings in the case brought by AS Milestone and  awarded

53,778 kroons in court costs to Kalev.



Plaintiff AS Milestone dropped its own suit, in which it was seeking annulment  of

the decisions taken at the general meeting of Kalev's shareholders on 14  December

2003, the removal of nine shareholder votes from the general  meeting  quorum  and

the voidance of their ballots.  The  case  had  named  AS  Kalev  and  these  nine

shareholders.



Kalev's attorney in the case, Leon Glikman, argued that the Supreme Court had  set

a precedent in the matter on 1  November  2004  to  the  detriment  of  Milestone,

quashing the latter's arguments alleging dominant influence on  the  part  of  the

director of AS Kalev and the voting ban of persons  allegedly  connected  to  him,

and making the case a lost cause for Milestone.





Ruth Roht

PR manager



+372 6 077 858