Company Announcement

Bakkavör Group Acquires a UK Chilled Dessert Manufacturer

Bakkavör Group (ICEX: BAKK) has further strengthened its position in the UK chilled dessert and cake market through the acquisition of Rye Valley Patisserie, part of Kerry Foods Limited, a division of Kerry Group PLC. The consideration price, which remains confidential, was financed through the Group's own cash resources and has been paid. The acquisition will not have a material effect on the Group's overall trading results.

Rye Valley Patisserie, which is based in Birmingham, specialises in the manufacturing of chilled desserts and employs 250 people. The company will be integrated into Bakkavör Group's chilled dessert and patisserie operations, which consist of Isleport Foods and Laurens Patisseries.

Further Information:

Ágúst Gudmundsson, CEO
Tel: +44 (0)20 7266 6400

Ásdís Pétursdóttir, Investor Relations
Tel: +354 858 9715

Bakkavör Group is a leading international food manufacturing company specialising in fresh prepared foods and produce. The Group operates 46 factories and employs over 16,000 people in seven countries with a pro-forma turnover in 2005 of over £1 billion. The Group's Head Office is in Reykjavík, Iceland, and the business is listed on the Iceland Stock Exchange (www.icex.is Ticker: BAKK).
Bakkavör Group was founded in 1986 and celebrates its 20th Anniversary this year. During this time, the business has grown significantly and today Bakkavör Group is the largest provider of fresh prepared foods and produce in the UK.

The Group's vision is to be recognised and respected as the world's leading fresh prepared foods and produce provider. Bakkavör Group has attained leading market positions in its key market areas of ready meals, pizzas, convenience salads and leafy salads. In total, the Group makes over 4,700 products in 17 product categories, which are developed and sold predominantly under its customers' own brands. In addition to the UK and Iceland, the Group also has business operations in France, Belgium, Spain, South Africa and China and is well-positioned for further expansion.


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