Refinancing of long-term debt


Arco group refinanced its long-term debt in SEB bank in projects Laeva and
Tivoli in Tallinn, Estonia. As a result of the agreement Arco must pay back
principal in amount of 40.0 mln kroons (2.6 mln euros) and SEB Bank agrees to
release liquidity covenant. According to the covenant Arco had to maintain the
level of liquid assets in amount of 150 mln kroons (9.6 mln euros) on SEB
accounts. 

The maturity of the debt is still March 2010 and new outstanding balance will
be 126.0  mln kroons (8.1 mln euros). Interest includes SEB's base rate on
kroon facilities and the total weighted average rate is 8.12% per annum. 

Arco Vara is one of the leading real estate developer in the Baltic's,
undergoing a SEE expansion with presence established already in Ukraine and
Bulgaria. Core business is real estate development supported by brokerage
network and construction arm. The company has offices in 20 cities and employs
400 people. According to 2007 results net sales was 727 mln kroons (46 mln
euros), net profit before minorities 235 mln kroons (15 mln euros) and assets 3
564 mln kroons (228 mln euros). Arco Vara is listed on Tallinn Stock Exchange. 

1 EUR=15,6466 EEK

Heigo Metsoja
CFO / Member of the Management Board
+372 6144 654
heigo.metsoja@arcovara.ee
http://www.arcorealestate.com