Established in 1963, Macon Deva is one of the largest producers of building materials in Romania. The company was privatized in 1994 through a management and employee buyout (MEBO) and became a 100% private joint stock company.
After privatization, the majority of profits were reinvested in new production facilities and in increasing the product quality.

Macon offers a wide range of products including autoclaved aerated concrete (AAC), prefabricated concrete elements, concrete poles, structural construction elements for industrial and civil buildings, elements for bridges and roads, insulating materials (mineral wool), roof tiles, etc.

During the last few years, Macon has enjoyed steady growth, reaching a very strong market position in Transylvania and enjoying good recognition and results in other areas of the country. The company achieved revenues in 2005 of €23 million, and sales in the first six months of 2006 totaled €11 million, 32% higher than the same period of 2005. Macon’s business objectives include expanding its product distribution in adjacent regions.

Romania’s construction business is one of the fastest growing economic sectors in the country, with 20% growth in 2005 and heavy investment bringing 2006 growth up to an estimated 35%. In 2005, construction works totaled approx. €7.4 billion.
Due to the lack of highways and quality roads, Romania plans to invest an extra €18 billion by 2010 in modernizing the transport infrastructure. With a forecasted growth within the next four years of approx. 11% annually, the construction sector in Romania continues to attract heavy investment.

“We intend to combine Macon’s good market position and high growth prospects with Enterprise Investors’ unique expertise in building company value, corporate governance and management. We believe that this winning combination will help us create the market leader in construction materials. The upcoming EU accession will have a positive impact on the Romanian construction market, which we estimate will become the most dynamic in the EU,” commented Cristian Nacu,
vice president at Enterprise Investors.

Enterprise Investors has been active since 1990 and is the largest private equity firm in Central and Eastern Europe. The firm manages funds totaling €1.6 billion. To date, private equity funds managed by EI have invested €0.9 billion in 102 companies, exited 85 investments and returned over €1.1 billion to their investors. The investment in Macon is the fourth investment of Enterprise Investors in Romania, after the firm’s acquisition of stakes in Artima, a supermarket chain in Transylvania, Siveco Romania, a leading software company, and Orange Romania (sold in 2005 to France Télécom). The Macon transaction brings the total invested by EI in Romania to almost €80 million.

EI has been advised during the Macon Deva transaction by Ernst & Young, RTPR and NNDKP law firms, while the sellers benefited from the support of Capitalinvest and M. Harsan Law Office.

With this grant, PAEF – managed by Enterprise Investors – has confirmed its commitment to supporting the Foundation in its mission to promote democratic and free market developments in Poland and the region.

The Polish–American Enterprise Fund established the Polish-American Freedom Foundation in 2000. This followed PAEF’s successful completion of its own mission to stimulate Poland’s private sector, as a result of which it could liquidate its assets. PAEF returned $120 million of its initial capital to the US Treasury, and gradually transferred the remaining funds to PAFF’s endowment. To date, PAEF has contributed a total of $213 million to the Foundation.

The Polish–American Enterprise Fund was established in 1990, following adoption by the US Congress of the SEED (Support to Eastern Europe’s Democracy) Act in 1989, with the objective to support the development of a market economy in Poland through loan programs, capital projects and training assistance. The United States transferred $262 million to PAEF. In the 1990s, the Polish–American Enterprise Fund was among the largest investors in Poland and contributed to the success of tens of thousands of Polish private companies. Thanks to professional management by EI and good cooperation with local entrepreneurs, PAEF increased its assets to over $350 million.

Since its inception in 2000, the mission of the Polish–American Freedom Foundation has been to reinforce civil society, democracy and the market economy in Poland and, in particular, to equalize opportunities for individuals in their social development, and to share the Polish transformation experiences with other countries of Central and Eastern Europe. To date, the Foundation has disbursed nearly $29 million toward 24 programs.

Enterprise Investors manages the largest group of private equity funds in the CEE region, including PAEF. In total, these funds have invested almost $1 billion in 100 companies in Poland, and have exited more than 80 investments, including all major PAEF investments, at very attractive rates of return. Many of PAEF’s portfolio companies were successfully restructured and floated on the Warsaw Stock Exchange.

Nay a.s. was established in 1991 and currently operates a network of 13 modern stores in 11 cities under the “Elektrodom”
and “Nay Elektro” trade names. Nay is the market leader in Slovakia in white and brown goods retailing with an estimated market share of 18%. The company’s stores are widely recognized for providing a broad range of quality products at low prices
and a high level of customer service. In 2004, Nay generated revenues of more than €75 million.

The investment in Nay is EI’s second investment in Slovakia after its funds acquired a stake in Orange Slovensko in 2001,
the leading Slovak mobile operator, as part of a consortium of financial investors. Slovakia is one of the best performing economies in the CEE region, and the Slovak market is poised for further growth as GDP and disposable income are on the rise.

Commenting on the transaction, Robert Manz, a partner at Enterprise Investors responsible for the investment, said: “Nay is an excellent retailer with an experienced management team. The company has a strong market position in Slovakia, which will be used as a base to develop in other countries in the region. Our involvement will provide additional support to carry out these expansion plans. We will contribute experience from our many other investments in the retail sector across the CEE region.
We look forward to working with the company’s other shareholders who have driven Nay’s successful development to date.”

Peter Zálešák, Nay’s CEO and one of its founding shareholders, added: “We are pleased to have a new investor on board that can bring additional resources and support as we execute our strategic plan. Enterprise Investors is the most successful private equity investor in Central and Eastern Europe and their interest in Nay validates our position as a market leader in Slovakia and our positive future perspective. We believe their entry as a shareholder will be a major asset for Nay.”

Enterprise Investors is the largest private equity firm in Central and Eastern Europe. Active since 1990, the company manages funds with capital exceeding $1.1 billion. The funds managed by Enterprise Investors have invested $955 million
in 100 companies in Poland, Slovakia, the Czech Republic, Romania and Bulgaria. EI’s funds have exited 77 investments to date at attractive rates of return. Allen & Overy Bratislava acted as EI’s legal advisors for the transaction.

Over the years, EI has made investments in several retail chains in Central and Eastern Europe, including Eldorado (Polish food retailer), Apteki Polskie (Polish pharmacies), Nomi (Polish DIY retailer), and Artima (Romanian food retailer). EI also financed the expansion of W.Kruk and Deni Cler (jewelry and women’s fashion) in Poland, and LPP (fashion retailer) across Central and Eastern Europe.

Grisoft was founded in 1991 as a local provider of anti-virus software. In 2001 the Brno-based company began its global expansion, and currently its AVG anti-virus program protects more than 25 million computers worldwide. Grisoft distributes its products globally through resellers and through the internet – the US market alone accounts for almost 40% of sales.
For 2005, the company budgets revenues of $25 million and a very healthy net income margin of around 30%.

“Grisoft is rapidly expanding both its customer base and product range, and has gained a solid reputation in the global anti-virus industry. We want to build on the company’s potential and work with the other shareholders to consolidate and further improve Grisoft’s position as one of the leading providers of computing protection for the SME marketplace,” said EI Vice President
Rafał Bator, who leads this investment.

Jefferies Broadview, a division of Jefferies International Limited, acted as advisor to Grisoft.

Enterprise Investors is the largest and oldest private equity firm in Central and Eastern Europe, managing investment funds since 1990 with capital now exceeding $1.1 billion. To date, the funds managed by EI have invested $955 million
in 100 companies in Poland and other CEE countries and have exited 76 investments at attractive rates of return.
This latest transaction brings EI’s total investment in IT and telecoms to almost $200 million.

Intel Capital, Intel Corporation’s venture investment program, invests in hardware, software and services companies in several market segments, including computing, networking, and wireless communications. Intel Capital has invested more than
$4 billion in approximately 1,000 companies in more than 30 countries since 1991.

Benson Oak Capital is the private equity arm of Benson Oak, an investment banking firm with primary activities in the Czech and Slovak Republics. The firm has advised on more than 75 transactions with a total value exceeding €6 billion. Benson Oak Capital acquired 100% of Grisoft in 2004.

Siveco Romania provides cutting-edge software solutions for large and medium-sized companies as well as for public and local administrations. Founded in 1992, the company has become the leading software developer and solutions provider in Romania, with revenues reaching $30 million in 2004. According to the market research company International Data Corp., Siveco Romania leads in the Romanian Enterprise Application Suite (EAS) market, with 31% market share, and has 11% of the country’s IT services market. In 2001, Siveco Romania started the IT-based Educational System (SEI) – a complex e-learning program designed to support the Romanian education system. Labeled in 2001 by the European Commission as a best practice e-government solution, this program has also been nominated for the European IST (Information Society Technology) Awards in 2005. Over 1,800 clients from 30 countries use the integrated services provided by Siveco Romania’s 400 IT specialists. The company has successfully developed business partnerships with the largest software houses worldwide, including Microsoft and Oracle, as well as with such IT integrators as HP, IBM, and Bull.

Forty percent of projects developed by Siveco Romania are for government agencies, including the Romanian Ministry of Education and Research, Ministry of Communication and Information Technology, Ministry of Finance, Ministry of Defense, Ministry of Foreign Affairs, Ministry of Labor and Social Protection, National Health Insurance House and National Customs Authority. Among the firm’s other largest customers are private companies including Petrom, the Nuclear Plant of Cernavoda, Raiffeisen Bank, Citibank, and Aerostar Bacau.

Commenting on the transaction, Mrs. Irina Socol, general manager of Siveco Romania said: “We welcome the investment
by EI and Intel. The upcoming EU accession of Romania and the need to adapt to international market requirements make IT projects a priority for all Romanian organizations. This represents a great growth opportunity for Romanian IT companies
and is a time for strategic decisions regarding international growth. We embark on this path with great confidence that stems from our expertise and our product portfolio, and we are optimistic the funding will help us grow our business on local and international markets.”

“Siveco Romania is a fast-growing company that has gained a solid reputation in Romania and in Western European and American markets. Having Intel as a co-investor in this business, we are convinced that we will consolidate Siveco’s leading position as a local IT services provider and will further expand in foreign markets,” stated Dariusz Prończuk, an EI partner, who is responsible for this investment.

Marcin Hejka, investment manager at Intel Capital, said: “With the accession of Romania to the EU a huge market opens up that demands the latest IT solutions in order to increase productivity and compete within the EU and beyond. We see Siveco Romania as an important part of this development in providing software solutions to both public and private entities as well as fostering innovation in education. The importance of Siveco’s role has been recognized by the EC’s Information Society Technology Award.”

Enterprise Investors is the largest and oldest private equity firm in Central and Eastern Europe – since 1990 it has managed five investment funds with capital exceeding $1.1 billion. These funds have invested close to $900 million in almost 100 companies in Poland, Romania and other CEE countries, and have exited 75 investments to date at attractive rates of return.
EI has extensive experience with IT and software companies, having invested $43 million in 11 IT companies (including today’s transaction). As part of EI’s commitment to Romania, three Romanian companies have benefited from $50 million of equity: Orange Romania, Artima, and Siveco Romania. EI has the region’s largest and most experienced team of 30 investment professionals, including 11 partners, in its offices in Warsaw, Bucharest and New York.
For more information, visit www.ei.com.ro

Intel Capital, Intel’s venture investment program, focuses on growing the internet economy by making minority equity investments, in support of the company’s strategic interests. Intel Capital invests in hardware, software and services companies in several market segments, including computing, networking, and wireless communications. The company has invested more than $4 billion in approximately 1,000 businesses in over 30 countries since 1991. Since its inception, about 160 portfolio companies have been acquired by other firms and another 150 have gone public on various exchanges around the world.
Intel Capital employs investment managers in about 25 countries worldwide. Last year alone, Intel Capital invested more than $130 million in about 110 deals, with approximately 40% of its investments made outside the United States.
For more information, visit www.intel.com/capital

Gamet Sp. z o.o., located in Toruń, Poland, is a major producer of furniture accessories with a well recognized brand on the Polish market. The company was established by a private entrepreneur in 1987 and was acquired by TDA (a private equity fund) in 2002, which in turn sold Gamet to EI.

Gamet produces and distributes furniture accessories and hardware including handles, knobs, legs, and drawer slides. Gamet’s market share in Poland is roughly 30%, and it exports one-third of its production, chiefly to Germany, Russia, and Ukraine. The company sells a high proportion of its products to furniture manufacturers and the balance to wholesalers and DIY chains. Sales in 2004 were PLN 103 million (€26 million).

Poland is the world’s #12 furniture producer and #5 exporter. The total value of Polish furniture exports in 2003 was €3.4 billion.

“Enterprise Investors has identified candidates for key management positions who have extensive industry experience and contacts among targeted customers. We plan to invest another €5 million in new production facilities in 2005/2006. Both these developments will speed the company’s growth,” said Jacek Woźniak, a partner at Enterprise Investors and leader of the Gamet transaction.

Krzysztof Pióro, the new president of Gamet, added: “Gamet has the opportunity to grow on the domestic market and expand to other EU markets. It is also well positioned to benefit from the substantial growth in furniture manufacturing in Russia and Ukraine, which is projected to continue at an annual rate of 15%.”

Enterprise Investors is the largest private equity firm in Central and Eastern Europe. Active since 1990, the company manages five investment funds with capital exceeding $1.1 billion. The funds managed by Enterprise Investors have invested $900 million in almost 100 companies in Central and Eastern Europe, and have exited 75 investments at superior rates of return.

EI leads the buyout market in Central and Eastern Europe. Since 2003, it has invested €234 million of equity in buyout transactions representing a total value of €687 million, including debt financing and co-investments. As part of its commitment to further developing the buyout market in CEE, Enterprise Investors sponsors the MBI & MBO Club, the only organization of its kind in the region.

Artima Retail Investment Company SA is a retail firm established in 2001 by the Romanian businessman Florentin Banu. Between 2002 and 2004, Artima benefited from three capital infusions made by prestigious international financial institutions from Germany and the United States: DEG, SEAF Trans-Balkan Romania Fund, and SEAF CEE Growth Fund. The company operates 14 supermarkets in 13 cities of the Transylvania and Banat regions, featuring over 15,000 sq. meters of shopping facilities. Artima has made spectacular progress, reaching turnover of €32 million in 2004. The number of employees increased continuously from fewer than 300 in 2001 to 770 this year.

Enterprise Investors is the largest private equity firm in Central and Eastern Europe. Active since 1990, the company manages five investment funds with capital exceeding $1.1 billion. The funds managed by Enterprise Investors have invested more than $850 million in almost 100 companies in Central and Eastern Europe.

The Artima transaction is EI’s second investment in Romania after the funds acquired a stake in Orange Romania in 1999-2001 as part of a consortium of financial investors. In October 2004 Enterprise Investors opened an office in Bucharest as part of the firm’s regional expansion strategy. Romania is the second-largest market in Central and Eastern Europe (after Poland). The country is set to join the European Union in 2007.

Over the years, EI has developed several retail chains in Poland, including Eldorado (food retailer), Apteki Polskie (pharmacies), and Nomi (DIY retailer). EI also financed the expansion of W.Kruk and Deni Cler (jewelry and fashion) in Polish cities, and LPP (fashion retailer) across Central and Eastern Europe.

Commenting on the transaction, Mr. Dawid Walendowski, a vice president of Enterprise Investors who is responsible for this investment, said: “We are delighted to close another deal in Romania. We plan to add significant value to the company by implementing proven strategies that we have developed over many years of investing in the retail industry. The management and staff of Artima have done a great job in creating Romania’s largest independent retailer. We expect excellent results from our cooperation with Mr. Clemens Petschnikar, a well-known and highly experienced manager active on the Romanian FMCG market since 1998.”

Mr. Clemens Petschnikar, Artima’s incoming CEO and EI’s main partner in this venture, said: “The decision to take over Artima is mainly driven by our positive expectations concerning the future development of the Romanian FMCG market, and by the solid groundwork put in place by the company’s founders. We are buying a good platform for further development and are planning to strengthen Artima’s position as a regional food retailer. Our ambitious development plan includes opening up to 40 more stores between 2005 and 2009 in western Romania.”

“Last October, Enterprise Investors and Pedersen & Partners inaugurated the first MBI & MBO Club in Romania in an effort to support successful managers in the acquisition of a stake in a company. Artima is the first management buyin that we have concluded in Romania since the start of the MBI & MBO Club’s activities and we look forward to other similar successes. In all transactions, management is the key partner that will ensure the success or failure of the business,” commented Mr. Jacek Siwicki, managing partner of Enterprise Investors, who is responsible for the firm’s operations in Romania.

“After four years of hard work I am extremely happy to have closed my second deal with a major international player. Following Joe Wafers, Artima is my second successful exit. I am proud to have succeeded again and to leave behind an exceptional team of more than 700 people and a highly competitive company,” said Mr. Florentin Banu, founder and former CEO of Artima.

To conclude the deal, Enterprise Investors was advised by the law firm Radu Taracila Padurari Retevoescu (RTPR) and by Ernst & Young.

The total transaction size is €96 million. An acquisition vehicle controlled by PEF V paid €54 million for DGS shares, while the remaining part will be financed by a loan from Bank Pekao SA and Bank Zachodni WBK. The buyout of DGS shares is the fourth biggest LBO in Central and Eastern Europe.

Krzysztof Grządziel, president and one of DGS’s founding shareholders, is the main force behind the company’s success. After PEF V’s investment he will continue as president and will hold a 20% stake. PEF V has received permission from the Polish antimonopoly office to carry out the transaction.

DGS is located in Włocławek, Poland and has been active since 1991 as a manufacturer of metal closures for alcoholic beverage bottles and for glass jars. The company is the leader on the Polish market and a significant player in this sector in Europe. Over half of DGS’s profits come from exports to countries of the former Soviet Union and to the EU. In 2004 the company achieved revenues of PLN 215 million (€54 million), exceeding the previous year’s results by 16%.

“DGS is a large and profitable company with an excellent management board and great prospects for the future. It is a good example of a Polish company that has achieved a significant position in Europe despite modest beginnings. We are very pleased with this investment and want to take part in DGS’s development and its further expansion in CEE markets and in the EU,” said Michał Rusiecki, a partner at Enterprise Investors, who is responsible for this investment.

Enterprise Investors is the largest private equity firm in Central and Eastern Europe. Active since 1990, it is the investment manager for five funds with $1.1 billion under management. The funds managed by Enterprise Investors have invested and committed more than $800 million in nearly 100 businesses in Poland and the CEE region.

Enterprise Investors has made many significant leverage buyout transactions, including a $12 million acquisition of 100% of Nomi in December 2003, 50% of which was financed with bank debt, as well as the €26 million buyout of 75% of Harper Hygienics in June 2004, where 32% of the transaction was financed by banks.

With 2004 sales of nearly PLN 200 million, Messenger Service Stolica SA is one of the largest companies on the Polish express courier and parcel market. The company has a well established countrywide network of offices nd facilities supported by more than 750 employees, and offers a premium quality service to its clients across Poland. Stolica’s customers include some of the most recognized companies in Poland and internationally, spanning a broad range of industries.

UPS is the world’s largest package delivery company and a global leader in supply chain services, offering an extensive range of options for synchronizing the flow of goods, information and funds. Headquartered in Atlanta, USA, UPS serves more than 200 countries and territories worldwide. UPS is listed on the New York Stock Exchange.

Enterprise Investors (EI) is the largest private equity firm in Central and Eastern Europe. Active since 1990, it is the investment manager for five funds, with $1.1 billion under management. The funds managed by Enterprise Investors have invested and committed more than $800 million in almost 100 businesses in Poland and other countries of Central and Eastern Europe. The funds have exited 71 investments and returned $779 million to investors.

Zelmer is Poland’s oldest and largest manufacturer of small electrical appliances such as vacuum cleaners and kitchen appliances, with a market share reaching 50%. Zelmer is one of Poland’s most valuable brands; it is very well recognized and associated with good quality at a favorable price. Zelmer is also a financially sound, growing and profitable company. The company’s management forecasts that sales will reach $80 million in 2004 and that net profit will exceed $4 million. Export is expected to account for 33% of 2004 sales.

“Thanks to the effort of the management team and a successful restructuring of Zelmer, the financial results of the company have improved significantly in the last three years. Zelmer has, in our opinion, large growth potential, both through entering new domestic market segments and launching new products as well as through further expansion in foreign markets. We want to participate in the next stage of Zelmer’s development and to support it as stable financial investors. Therefore we have declared that we will not sell our stake for the next three years,” commented Jacek Siwicki, managing partner of Enterprise Investors, who is responsible for the investment. “We believe that the experience we gained during the privatization of Polar will be valuable for Zelmer’s future development,” Mr. Siwicki added.

Enterprise Investors (EI) is the largest private equity firm in Central Europe. Active since 1990, it is the investment manager for five funds, with $1.1 billion under management. The funds managed by Enterprise Investors have invested and committed more than $800 million in almost 100 businesses in Poland and other Central European countries. The firm has privatized 18 Polish companies and has been involved in 19 IPOs. One of EI’s main competitive advantages is its reputation for following best practice in corporate governance.

From 1997 to 1999 the funds managed by EI completed the privatization of Polar, Poland’s largest white goods manufacturer. With the support of Polar’s management team EI modernized the company, improved and expanded Polar’s product line, launched new products, and optimized the company’s operations. The price of Polar’s shares increased from PLN 11 to PLN 25 per share in the course of EI’s investment.