Tallinna Kaubamaja                ANNOUNCEMENT                   07.12.2004



Foundation of a subsidiary of Tallinna Kaubamaja Kinnisvara AS



On 3 December Tallinna Kaubamaja Kinnisvara AS (the real estate company) founded

a full subsidiary Tartu Kaubamaja Kinnisvara OÜ. The purpose of the foundation

was to implement the project of the construction and development of the Tartu

Kaubamaja building and later the maintenance of the object.



The share capital of Tartu Kaubamaja Kinnisvara OÜ is 40 thousand kroons (2.6

thousand euros). The Chairman of the Board is Peeter Kütt and the members of the

Supervisory Board are Enn Kunila, Jüri Käo, Andres Järving, Indrek Vanaselja and

Raul Puusepp.



After the company has been entered into the Business Register, the real estate

with the address at Riia 1, Vanemuise 2 and Küüni 14, Tartu will be sold at

balance sheet value to Tartu Kaubamaja Kinnisvara OÜ.



The closed net area of the building is 27 500 sq m, including rentable business

area of 14 400 sq m. There will be over 200 parking places in the building. The

construction will be completed in August 2005.





Katrin Mühls

CFO and Sales Director

Tallinna Kaubamaja AS

phone +372 6 673 200