KAPPAHL STRENGTHENS BALANCE SHEET

To strengthen KappAhl's financial position, the Board of KappAhl AB (publ)
("KappAhl") intends to propose a guaranteed new share issue of approximately SEK
375 million with preferential rights for the shareholders. The Board's intention
is that the details of the rights issue shall be determined and communicated
within two weeks of this press release. The principal owner Dutot Ltd.
(representing 16.3 per cent of the capital) has declared its intention to vote
for the issue and undertake to subscribe for its share of the issue.
The company has also signed an agreement to sell the property that contains the
distribution center and headquarters. Sales are made through the company and
with an underlying property value of SEK 490 million. The deal is expected to
generate a capital gain of approximately SEK 60 million. Meanwhile, a new 15
-year lease has been signed. Completion will take place at the end of November.
The Group had at 31 August 2011 interest-bearing debt of approximately SEK 2,300
million. The above two steps with what is made the past year, the company's
interest-bearing liabilities are soon reduced to about SEK 800 million. The
measures are made to once again be within the announced objective of the Net
Debt/Ebitda not exceeding 3.0 times. The coming debt level correspond broadly
the inventory value and thus is assessed to be at a sustainable level in the
financial climate that now prevails.

For further information, please contact:
Johan Åberg, President and CEO, tel. +46 706 09 99 73, johan.aberg@kappahl.com
Håkan Westin, Chief Financial Officer, phone +46 704 71 56 64,
hakan.westin@kappahl.com
KappAhl is a leading Nordic fashion chain with more than 380 stores and close to
4 900 co-workers in Sweden, Norway, Finland, Poland and the Czech Republic.
KappAhl designs, markets and sells value-for-money fashion and focus in
particular on women 30-50 years of age. During the financial year 2011/2012,
KappAhl had sales of close to SEK 4.6 billion. KappAhl shares are listed on the
NASDAQ OMX Stockholm. In 1999, KappAhl was the first fashion chain to receive
environmental management standard certification. Further information is
available at www.kappahl.com.

KappAhl AB (publ) discloses the information provided here pursuant to the
Securities Market Act and/or the Financial Instruments Trading Act. The
information was submitted for publication on October 10, 2012 07.30 CET.