August 1st 2009

Svendborg Brakes Merging

As of today Svendborg Brakes is merged with LM Glasfiber and will be part of the new overall company named LM Windpower.

The merger is a very natural step for both companies; both Svendborg Brakes and LM Glasfiber have a leading role within the wind business with joint ownership and it will enable both companies to grow within the industry.

The main reason for the merger is that it will strengthen both companies' financial position and growth profile while maintaining the focus on wind customers. It means that there will be many advantages by being one legal and financial entity in terms of financial planning, cash flow management, raising capital, investments, administration, reporting etc. It provides additional scale and critical mass.

The reason why we are not merging the two companies fully - despite we are serving the same industry and customers - is that our two business models are very different and our approach and the way we do things are different.

The aim with the merger is not to reduce costs or change the way the companies operate, but purely to create the benefits of increased scale and financial strength.

We do not plan any lay offs due to the merger, but again simply harvest from the financial synergies.

Also the merger does not result in Svendborg Brakes running and working with the same procedures and corporate structures like LM Glasfiber, however we do expect some synergies in terms of financial reporting and systems.

Both Svendborg Brakes and LM Glasfiber will remain separate entities with different names, separate management, administration, locations etc.