STOCKMANN SELLS STOCKMANN AUTO OY AB TO VEHO, THE VOLKSWAGEN-AUDI BUSINESS TO KESKO AND THE FORD DEA

STOCKMANN plc STOCK EXCHANGE RELEASE January 20, 2006, at 9.00

STOCKMANN SELLS STOCKMANN AUTO OY AB TO VEHO, THE VOLKSWAGEN-AUDI BUSINESS
TO KESKO AND THE FORD DEALERSHIPS IN TURKU AND ESPOO TO SOK. STOCKMANN TO
OFFER VEHO’S ENTIRE RANGE OF MODELS TO ITS LOYAL CUSTOMERS.

Stockmann has today, January 20, 2006, sold the entire shares outstanding
in its subsidiary Stockmann Auto Oy Ab to Veho Group Oy Ab, Stockmann
Auto’s Volkswagen-Audi business to Kesko Corporation’s subsidiary VV-Auto
Oy and its retailing company Helsingin VV-Auto Oy, as well as the Ford
dealerships in Turku and Espoo to Maan Auto Group, owned by SOK
Corporation, for a total price of about EUR 70 million. The transactions
are contingent on approval by the competition authorities. Veho will
continue selling Stockmann Auto’s line-up of Ford, Skoda, BMW and MINI
vehicles in addition to its own previous marques. In future, Stockmann
will offer its loyal customers Veho’s entire range of marques and launch
wide-ranging loyal customer cooperation together with Veho.

Stockmann has today, January 20, 2006, sold the entire shares outstanding
in its subsidiary Stockmann Auto Oy Ab to Veho Group Oy Ab, Stockmann
Auto’s Volkswagen-Audi business, including its real-estate properties, to
Kesko Corporation’s subsidiary VV-Auto Oy and its retailing company
Helsingin VV-Auto Oy, as well as the Ford dealerships in Turku and Espoo
to Maan Auto Group, owned by SOK Corporation, for a total price of about
EUR 70 million. Title to Stockmann Auto and the divested businesses will
pass to the buyers on March 1, 2006, subject to approval of the
transactions by the competition authorities. Stockmann Auto has about 680
staff, of whom about 260 will remain in the employ of the divested
company, some 300 of whom will transfer to the employ of Helsingin VV-Auto
under their current terms of employment and some 115 of whom will transfer
to the employ of Maan Auto Group under their current terms of employment
as well.

Stockmann Auto sells Ford, Skoda, Volkswagen and Audi in the Helsinki
metropolitan area; Ford in Turku; Skoda and Ford in Tampere as well as BMW
and MINI in Oulu. It also has a wide range of trade-in vehicles and
operates versatile servicing and repair facilities. Veho is a major dealer
for Citroen, Honda, Mercedes-Benz, Mitsubishi, smart and Maybach. It has a
comprehensive network of car dealerships in all the localities in Finland
where Stockmann has a department store. Apart from the Volkswagen and
Audi, Stockmann’s marques will round out Veho’s product palette. For
Stockmann’s loyal customers, the deal means an expanded range of service
and enhanced benefits because Stockmann will offer its loyal customers
Veho’s full range of vehicles.

Stockmann Auto has nine outlets in the Helsinki metropolitan area as well
as an outlet in Turku, Tampere and Oulu. Stockmann Auto Oy Ab was formed
on January 1, 2005, by incorporating the Stockmann Group’s vehicle
business and the properties used in its operations as an independent
company. Stockmann’s vehicle business had sales in 2004 of EUR 437
million, or about 25 per cent of the Stockmann Group’s sales. The vehicle
business generated operating profit of EUR 7.0 million and its return on
capital employed was 12 per cent. Stockmann Auto’s preliminary sales in
2005 amounted to EUR 414,1 million, or about 7 per cent less than sales by
Stockmann’s vehicle business in 2004. Stockmann Auto’s operating profit
for the first three quarters of 2005 was EUR 2.5 million, down EUR 4.1
million on the Stockmann Vehicle Division’s operating profit in the
comparative period. A major factor behind the drop in both sales and
operating profit was the transfer of the Volkswagen-Audi dealership in
Helsinki’s Herttoniemi district to the importer as from July 1, 2004. In
addition, operating profit in the comparative period included an EUR 2.3
million payment that was received on the sale of the Volkswagen-Audi
dealership in Herttoniemi.

The capital gain on the sale of Stockmann Auto’s shares and the businesses
will improve Stockmann’s first-quarter earnings. Henceforth, Stockmann
will focus on its core businesses: the Department Store Division, Seppälä
and Hobby Hall. The freed-up capital will be used to expand operations in
Finland, Russia and the Baltic countries.

Klaus Sundström, managing director of Stockmann Auto Oy Ab and a member of
the Stockmann Group’s Management Committee, will oversee implementation of
the company and business transactions of the vehicle business. After the
transactions are completed, Mr. Sundström will take up special duties with
Stockmann plc and resign from the company’s employ six months after the
transactions have been finalized.

Further information:
Hannu Penttilä, CEO, Stockmann, tel. +358 9 121 5801
Pekka Vähähyyppä, CFO, Stockmann, tel. +358 9 121 3351

STOCKMANN plc

Hannu Penttilä
CEO

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Helsinki Stock Exchange
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