OREANDA-NEWS. Due to changes in group strategy Arco Vara discontinued construction activities (including environmental construction) as a core business line since the end of 2013.

Therefore Arco Vara Ltd sold 100% of shares of subsidiary company Arco Ehitus to Stratcorp Ltd on 14 of February 2014. Sale price of shares consists of two parts:

a) At the transfer of ownership 10 thousand euros;

b) Buyer will pay 30 per cent of proceeds of two legal disputes-with Ministry of Education and Research and with Loksa Haljastus Ltd. Dividend income tax will be paid on profeeds.

Manager of Group added,“ With sale of Arco Ehitus Ltd. we have concluded an important step in reforming Arco Vara group into company focused solely on development of real estate and offering related services.“

The buyer, Stratcorp Ltd, is not related to Arco Vara Group and transaction is not considered as a transaction with a related party (according to NASDAQ OMX Tallinna Stock Exchange rules of “Requirements to Emitent.

According to sales agreement company will not continue under name of Arco Ehitus Ltd.

Sale of Arco Ehituse Ltd has significant influence on corporate results of Arco Vara . Most important financial data for , 31.12.2012.,31.12.2011 and 31.12.2010, are given below Arco Ehitus Ltd.

Profit statement

2012

2011

2010

Sales revenue

9 800 956

18 121 308

8 627 397

Cost of goods sold

-9 319 294

-20 348 959

-8 063 435

Gross profit/loss

481 662

-2 227 651

563 962

Marketing expenses

-80

-3 423

-971

Overhead expenses

-942 601

-585 747

-901 326

Other revenue

204 398

8 849

27 677

Other expenses

-14 947

-53 292

-11 129

Operating revenue-loss

-271 568

-2 861 264

-321 787

Financial revenues and expenses

-13 036

-87 686

-88 042

Net income/loss before taxes

-284 604

-2 948 950

-409 829

Net income/loss

-284 604

-2 948 950

-409 829

Arco Ehitus Ltd has not paid dividends, common stock is 49 thousand euros.

Liabilities of Arco Ehitusel are as of 31.12.2013 1980 thousand euro, including 432 thousand euros what is owned to parent company. Company has total assets of ca 1049 thousand euros

The claims related to legal disputes are not included into assets , therefore company value is higly related to outcome of legal disputes.

Aim of buyer is to finish al leagal disputes with positive cash flow for company.