Kalev                            ANNOUNCEMENT                           17.12.2004



Contract concluded by subsidiary



On 7 December 2004, AS Kalev Real Estate Company (AS Kalev REC)  and  United  Real

Estate OÜ (URE OÜ) concluded a contract on the free-of-charge transfer of a  share

in the private limited company Sõbra Korterid OÜ. Pursuant to  the  contract,  URE

OÜ transferred to AS Kalev REC a 20-thousand-kroon share-i.e.  50%  of  the  share

capital-of the private limited company.



Sõbra Korterid OÜ's  main  field  of  activity  is  real  estate  development  and

administration.



AS Kalev REC acquired the share in Sõbra Korterid OÜ  with  the  aim  of  pursuing

real estate development on the housing market. The private limited  company  plans

to construct two new apartment buildings on the real  estate  located  at  Kastani

183a and 183b in Tartu.



The transaction does not represent a transaction  with  a  related  party  in  the

meaning of the Tallinn Stock Exchange rules and regulations.





Ruth Roht

PR manager

+372 6 077 858