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Marfin Investment Group: Announcement

Direct News Source

09-Oct-2013 ANNOUNCEMENT

  • Liability reduction, increase of liquidity and improved Group Balance sheet Structure

Marfin Investment Group Holdings S.A ("MIG") announces that the European Competition Commission (DG Comp) has approved the sale of Olympic Air to Aegean Airlines. The relevant transfer of shares is expected to be completed within the next two (2) weeks, following which Olympic Air becomes a subsidiary of Aegean Airlines. In addition, both Olympic Air and Aegean Airlines brands will be used in parallel, whilst each company will retain its distinct flight operations and fleet. The total transaction consideration is €72m paid in cash, of which an amount €20m has been already paid.

The protracted, adverse economic conditions in the broader Southeast European region have rendered the transaction necessary. The successful completion of the transaction ensures the future use of the Olympic Air brand, as well as safeguards the potential for continued and uninterrupted air transport both at home and abroad. We believe that without the envisaged transaction, the continued operating losses and the inevitable retraction of activities by airline carriers would limit Greece's airline connections, with uncertain consequences for the airline industry and the economy.

The agreement enhances MIG's cash balances by an amount of €52m which will be phased in and the reduction of total Group liabilities by an amount of € 117.8 million representing obligations of aircraft financial lease contracts. These moves significantly improve the financial structure of the Group. In the consolidated financial statement of the MIG, Olympic Air is displayed as a discontinued operation since the end of 2012.

The agreement is part of the Marfin Investment Group's strategy to disengage from activities with negative cash flows and focus on its core business with healthy prospects and positive financial results, targeting medium term value creation for the shareholders of the Group.