SATO: Notice to noteholders

SATO Corporation, Company Announcement, 1st September 2016 at 11:05 am

THIS NOTICE IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

NOT****ICE TO NOTEHOLDERS
SATO CORPORATION
(incorporated with limited liability in the Republic of Finland)

In respect of the
EUR 300,000,000 2.375 per cent. guaranteed Notes due 2021
and
EUR 300,000,000 2.250 per cent. guaranteed Notes due 2020

(together, the "Notes")

1. Introduction

SATO Corporation ("SATO") has effected a number of intra-group mergers to simplify its group structure, including the merger of SATOhousing Oy into SATO-Asunnot Oy (each a Note Guarantor for the Notes) (the "Internal Reorganisation").

The mergers took effect on 1 July 2016, when they were registered as completed in the Finnish Trade Register.

SATO wishes to notify the Noteholders and the Irish Stock Exchange of the change in the group structure and confirm that there has not been any (i) Event of Default, or (ii) Note Guarantor Property Investment Event following the Internal Reorganisation.

1. Corporate Position of SATO-Asunnot Oy

Under Finnish law, when a merger is completed, the assets and liabilities of a merging company transfer to the receiving company. The merging company then ceases to exist.

Accordingly, on 1 July 2016, all of the assets and liabilities of SATOhousing Oy were transferred into its parent company, SATOkoti 2 Oy, which then merged into SATO-Asunnot Oy.  Each of SATOkoti2 Oy and SATOhousing Oy then ceased to exist.

Prior to the Internal Reorganisation, the combined total fair value of the assets of both Note Guarantors was EUR 2,132.6 million. Following the Internal Reorganisation, the total fair value of assets held by SATO-Asunnot Oy following the mergers has increased by EUR 100.2 million to EUR 2,232.8 million.

1. Rating of the Notes

Following the implementation of this Internal Reorganisation, SATO expects no change in the 'Baa3' rating of the Notes assigned by Moody's Investors Service Ltd ("Moody's").

1. No Event of Default or Note Guarantor Property Investment Event

SATO confirms that there has been no Event of Default or Note Guarantor Property Investment Event.

The Trustee expresses no opinion on this Notice but has consented to the distribution of this Notice to the Noteholders.

This Notice is given by:
SATO Corporation
Panuntie 4
PL 401, FI-00601 Helsinki
Finland

For any queries please contact:
Janne Runsamo
Email: Janne.Runsamo@sato.fi
Phone: +358 201 34 4009
Date: 1 September 2016