Lemminkäinen and YIT will complete the merger
LEMMINKÄINEN CORPORATION STOCK EXCHANGE BULLETIN 29.9.2009, 15.00 ADDITIONAL INFORMATION ON THE DECISION OF THE SUPREME ADMINISTRATIVE COURT ON THE ASPHALT MATTER The Supreme Administrative Court (the SAC) has today ordered a number of Finnish asphalt industry companies to pay an infringement fine of EUR 82.55 million, of which amount Lemminkäinen is to pay EUR 68 million. The decision settled finally the Finnish Competition Authority's claim made in 2004 for the imposition of a competition
LEMMINKÄINEN CORPORATION STOCK EXCHANGE BULLETIN 29.9.2009, 15.00 ADDITIONAL INFORMATION ON THE DECISION OF THE SUPREME ADMINISTRATIVE COURT ON THE ASPHALT MATTER The Supreme Administrative Court (the SAC) has today ordered a number of Finnish asphalt industry companies to pay an infringement fine of EUR 82.55 million, of which amount Lemminkäinen is to pay EUR 68 million. The decision settled finally the Finnish Competition Authority's claim made in 2004 for the imposition of a competition infringement fine concerning violations of the Act on Competition Restrictions to seven companies operating in the asphalt industry during 1994 and 2002. According to the decision rendered by the SAC, a nation-wide asphalt cartel existed in Finland between 1994 and 2002 consisting of all the largest players in the field. Despite the fact that the SAC considered that the cartel was nation-wide, it notes that the evidence presented by the Finnish Competition Authority does not cover geographically or temporally all the incidents of the asphalt markets. The Competition Authority proposed a total competition infringement fine of EUR 97 million for the companies in the industry and for the Finnish Asphalt Association, of which amount Lemminkäinen was to pay EUR 68 million. The Market Court dismissed the Competition Authority's motion for the most part and ordered in December 2007 the asphalt companies to pay an infringement fine of EUR 19.4 million, of which Lemminkäinen was to pay EUR 14 million. (Bulletins on 19 December 2007) The SAC's decision relates to Lemminkäinen's road-paving operations in Finland, which accounted for approx. 10% of the Group's total turnover in 2001. Lemminkäinen acknowledged that the decision rendered by the Market Court had already shown that the conduct of business by Lemminkäinen in the Finnish road-surfacing market has, to some extent prior to the year 2002, included aspects that are in contravention of competition legislation. Lemminkäinen will not, under any circumstances, approve of the use of illegal procedures in its operations. Over the years, special efforts have been made within the Group to intensify training in issues concerning competition law and to provide related instructions. The difference between the infringement fine of EUR 68 million ordered by the SAC and the infringement fine of EUR 14 million ordered by the Market Court (EUR 54 million) will be accrued as expense for the third quarter of 2009. Correspondingly, the company accrued the infringement fine of EUR 14 million ordered by the Market Court on the results of the fourth quarter of 2007. Lemminkäinen renews its earlier guidance according to which the Group's turnover of 2009 will be clearly lower than the level of 2008. As consequence of the infringement fine imposed by the Supreme Administrative Court, the company's financial result in 2009 will be clearly negative. Certain municipalities have announced in the statements of claim submitted to the District Court of Helsinki that they will claim for damages from Lemminkäinen and other asphalt companies if the SAC notes that the asphalt companies have acted in contravention of competition legislation in the areas of the municipalities. The claims presented in the statements of claim differ from each other as regards their amounts and grounds. In addition, the Finnish Road Administration has claimed, relating to the state works, the total of EUR 10.5 million from Lemminkäinen and jointly and severally with other asphalt companies the total of EUR 5.6 million. At the request of the municipalities and the Finnish Road Administration, the District Court has so far not considered the claims, because they were suspended to wait for the decision of the SAC. The decision rendered by the SAC shall probably initiate the consideration of the claims for damages to the extent the Finnish Road Administration and the municipalities regard that the decision of the SAC provides reason for it. Lemminkäinen initially considers the claims presented by the municipalities and the Finnish Road Administration as unfounded. Furthermore, the decision rendered by the SAC does not concern individual contracts or their pricing. Claims for damages will be considered separately before the District Court of Helsinki and heard in the order determined by the court. Lemminkäinen will communicate on the claims either separately or together, depending on their contents, in connection with the interim reports. Thus far, no expense reserves have been made on the statements of claims submitted to the District Court by the municipalities and the Finnish Road Administration. LEMMINKÄINEN CORPORATION Timo Kohtamäki President & CEO ADDITIONAL INFORMATION: Further information will be given today after 3 p.m. by President and CEO Timo Kohtamäki, tel. +358 20 7153 263. DISTRIBUTION: NASDAQ OMX Helsinki Ltd Key media www.lemminkainen.com Lemminkäinen Group operates in all areas of the construction sector. The Group's business sectors are building construction, infrastructure construction, technical building services, and building products. Net sales in 2008 were approx. EUR 2.5 billion, of which international operations accounted for over a quarter. The Group employs about 9,800 people. Lemminkäinen Corporation's share is quoted on NASDAQ OMX Helsinki Ltd. www.lemminkainen.com