Launch of a joint venture agreement with Bayrock Group LLC FL Group announces that it has invested $50m in four active US-based real estate development projects alongside Bayrock Group, a US-based international real estate investment and development firm. These projects are: • Trump Soho - The development of a 5 star hotel condominium in Soho, Manhattan, in partnership with Donald Trump and the Sapir organization. • Trump Lauderdale - The development of a 5 star hotel condominium in partnership with Donald Trump situated on Fort Lauderdale beach. • Whitestone New York - The development of 13 acres of land located along the east river in Whitestone, Queens. Bayrock Group plans to build a number of luxury homes and town homes on this land. • Camelback - The development of a 5 star hotel and residential condominium in Phoenix. The lifetime of the projects is expected to be between two to three years. The investment will be funded with own funds and loans. Alfa Investment Consulting were a facilitator to the transaction and advisor to Bayrock Group. FL Group has also formed a 50:50 joint venture agreement with Bayrock Group. The new venture has been formed for investments in worldwide real estate development projects. Commenting on the new venture, Hannes Smárason, CEO of FL Group said: “This is a very exciting venture, which highlights FL Group's continued desire to take advantage of new and unique opportunities. The real estate market is an exciting, strong and competitive sector with great growth potential. We look forward to exploring this area with such a distinguished partner as Bayrock Group both in the US and internationally when the possibilities arise. ” Tevfik Arif Chairman of Bayrock Group commented: “We are delighted to develop a partnership with FL Group and secure the support of a financial partner with such excellent expertise. We look forward to working with the first-rate team.” For further information: FL Group: Kristján Kristjánsson Director Corp. Communications Tel: +354 591 4400 / 354 899 9352 www.flgroup.is Brunswick Group LLP Anita Scott, Leonora Pou tel. +44 (0)20 7404 5959 Bayrock Group: Mr. Felix Satter Tel. +1 212 207 6650 Notes to Editors About FL Group: FL Group is an international investment company, focusing its activities on two areas of investments. The company's Private Equity and strategic investments focus on investments in public and private companies and has a long term view. The company's Capital Markets unit oversees the company's short term trading as well as derivative and security trading related to the company's asset portfolio. With its head office in Reykjavik and offices in Copenhagen and London, FL Group invests in companies in Northern Europe, focusing primarily on the Nordics and the UK but also has investments elsewhere. FL Group is listed on the OMX Nordic Exchange in Reykjavik (OMX: FL). At the end of first quarter 2007 FL Group's total assets amounted to ISK 303 billion (EUR 3.4 billion). Its market capitalisation at the end of March 2007 was ISK 236 billion (EUR 2.7 billion). The largest shareholders of FL Group are Oddaflug BV (19.8%), owned by Hannes Smárason, CEO; Baugur Group (18.2%), Gnúpur fjárfestingafélag hf. (17.2%), Icon and Materia Invest (10.7%). The shareholding can in some cases be in the name of Icelandic financial institutions because of forward contracts. More information on www.flgroup.is About Bayrock Group: Bayrock Group, LLC is an international real estate investment and development firm focused on top class real estate product throughout the world. Bayrock Group's professional team combines countless years of experience in all aspects of real estate development and has come together to create a world class team of real estate development specialists. Bayrock Group has made investments in transactions comprising real estate assets valued in excess of $5 billion.