GORENJE, d.d., Velenje

Management of Gorenje has no intentions for management buyout

Management of Gorenje denies the inexact and unverified information concerning the management buyout assumingly to be carried out under planned process of increase of capital, by buying shares at discount, which was released to the public by some of the media earlier today.

In July this year, the Management of Gorenje revealed its intention to increase share capital to support the future growth of the company. More possibilities had been considered for increase of capital, carried out in various stages, pursuant to the company strategic plan.

Mr. Franjo Bobinac, CEO, explains: »For the planned sale of shares to the management of Gorenje, we plan to acquire few percentage share in the ownership, which by all means cannot be the majority share. It is therefore ridiculous to confuse the sale of shares with management buyout. Gorenje's equity is far too big to be taken over by the management. I must point out however, that EBRD - our substantial potential investor, reasonably expects the management to buy out a few percentages of shares. Nevertheless, this is a strong impulse, showing that the management of the company firmly believe in its strategy and will strive to accomplish the setup goals. To this purpose, the management will use up their personal savings and arrange personal crediting instruments to buy the shares at the price equal to the one available to shareholders, as we plan to invite all our shareholders to participate in the process of increasing of capital.«

The public announcement will be also available on the www.gorenje.com web-site.

Date: 9. 11. 2006