Major shareholder announcements

Bakkavör Group Major Holdings

14.8.06

Name of party notifying Kaupþing banki hf.
Address of the party notifing Borgartún 19
Date of transaction 11.8.2006
Number of shares in transaction 79.673.301
Number of shares before the transaction 119.007.172
Number of shares after the transaction 39.333.871
Holdings of total nominal value before the transaction % 5,58%
Holdings of total nominal value after the transaction % 1,84%
Notification is based on Art. 33 (1) of the Act no. 33/2003 point(s) no.1.

Additional information
"A total of 30,592,477shares, or 1.43 % of BAKK´s share capital, are held in Kaupthing Bank´s books as a hedge against forward contracts.

In addition the bank owns convertible bonds in BAKK, which have been sold forward to customers. On the basis of the position on 11 August 2006, these shares would represent ISK 23,722,418 of the company´s share capital in nominal value (1.10%), if they had been converted into share capital on that date, concurrent with a corresponding increase in the company's share capital. This major holdings announcement is in accordance with Art. 34 of the Act no.33/2003"