MACHINIUM RESTRUCTURING CONTINUES WITH T

LÄNNEN TEHTAAT PLC    STOCK EXCHANGE RELEASE    May 25, 2004, 3.15 pm

MACHINIUM RESTRUCTURING CONTINUES WITH THE SALE OF THE BACKHOE LOADER
MANUFACTURING BUSINESS

Agreement has been reached between the Machinium Ltd subsidiary Lännen
Engineering Oy, on the one hand, and AVS-Yhtiöt Oy, AVS-Yhtiöt
Managing Director Antero Parma and Timo Huttunen, on the other, on the
sale of the business operations of Lännen Engineering Oy, which
manufactures medium-sized backhoe loaders. The deal means that Lännen
Engineering Oy’s business operations will be transferred to a new
company, Lännen Tractors Oy, on May 25, 2004. The proceeds from the
sale will be used to strengthen the capital structure of the companies
in Lännen Tehtaat plc’s Machinium Division.

Lännen Engineering Oy’s net turnover in 2003 was EUR 16 million, and
its profit before extraordinary items EUR 0.9 million. Following the
deal, the company’s 130 employees at its Loimaa plant will be employed
by Lännen Tractors Oy.

Suomen Rakennuskone Group and SMA Construction AB will continue to
distribute Lännen backhoe loaders in Finland, Sweden and the Baltic
States.

AVS-Yhtiöt manufactures and supplies pneumatic and hydraulic equipment
and industrial valves for industrial customers in Finland and for
export. AVS-Yhtiöt’s net turnover in 2003 was approximately EUR 50
million and it employed about 250 people.

Timo Huttunen, Managing Director of both Machinium Ltd and Lännen
Engineering Oy, will take up the position of Managing Director of
Lännen Tractors Oy.


LÄNNEN TEHTAAT PLC

Erkki Lepistö
President & CEO


More details: Erkki Lepistö, tel. +358 2 8397 4001.

Distribution:
Helsinki Exchanges
Main media
www.lannen.fi

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