Jelmoli announces update on strategic plan

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The issuer is solely responsible for the content of this
announcement.
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- Reverse premium to be offered to Pelham Investments to cede control
of proposed Real Estate Company
- Exit option for shareholders in the Investment Company
- Extraordinary Shareholders Meeting to be held at the beginning of
November 2008

Jelmoli announced in April 2008 its strategic plan to separate into
two independent companies, a Real Estate Company and an Investment
Company. The creation of the two stand-alone businesses will take the
form of a tax-neutral distribution of the shares in the Investment
Company to Jelmoli shareholders. Since then, the Board of Directors
of Jelmoli has continuously refined and progressed the strategic plan
for the company. With today's announcement, the Board of Directors
provides further detail on the magnitude of the proposed reverse
premium to Pelham and introduces a mechanism in the Investment
Company which allows shareholders to choose to either stay invested
or exit a significant part of their position in the Investment
Company. As the preparations for the implementation of the strategic
plan are largely completed, the Board of Directors intends to present
the strategic plan to shareholders for approval in an extraordinary
shareholders meeting at the beginning of November.

The Real Estate Company
The Real Estate Company, which will continue to operate under the
name of Jelmoli Holding AG, will be the second largest public real
estate company in Switzerland with a book equity value of
approximately CHF 1.6 billion and a capital structure at the lower
end of the previously communicated loan-to-value (LTV) range of 40%
to 50%. The House of Brands and Bonus Card will remain with the Real
Estate Company and will provide significant value upside through the
further optimisation of these retail operations together with the
most valuable property assets in the portfolio. The participation in
Tivona will also remain with the Real Estate Company.

As compensation for ceding control in the Real Estate Company, the
Board of Directors will propose to offer the current controlling
shareholder, Pelham Investments S.A. ("Pelham"), a reverse premium of
50,000 new Real Estate Company bearer share equivalents at nominal
value, which represents a premium of approximately 18% on Pelham's
stake in the Real Estate Company. Once shareholder and other
regulatory approvals have been granted, the Real Estate Company's
share capital will comprise of one registered share class once
trading in its stock commences. Bearer shares will be converted into
registered shares at a ratio of 1:5. The reverse premium offered to
Pelham will translate into 250,000 registered shares which will be
issued to Pelham with the exclusion of subscription rights of other
shareholders. The shareholding of Pelham in the Real Estate Company
will thereby increase from 25.2% to 29.8% of shares issued, while at
the same time voting rights will decrease from 52.9% to 29.8%.

"With its high quality real estate portfolio, significant retail
exposure, conservative capital structure and further upside
potential, the Real Estate Company will be uniquely positioned on the
SWX. The removal of the dual class shareholder structure addresses a
key concern of many of our shareholders and will contribute to the
attractiveness of the Company in the capital markets", said
Christopher Chambers, Chairman of the Board of Directors.

The Investment Company
The Investment Company's assets will comprise liquid funds, the less
conservative participations in Russia, Algeria, Seiler Hotels and the
non-core retail businesses of Molino, Beach Mountain and Fundgrube.
As previously indicated, the Investment Company will have a book
equity value of approximately CHF 1 billion prior to the cash exit
option introduced with this announcement. The dual class shareholder
structure in the Investment Company will be maintained and Pelham
will continue to be the controlling shareholder. As the Investment
Company will have to establish a track record in the capital markets,
the Board of Directors proposes to give shareholders the option to
either stay fully invested in the Company or to exit a significant
part of their position. As a result, Jelmoli will offer a cash exit
option for shareholders in the Investment Company through a share
buyback program. Shareholders will receive tradable put options which
will allow them to put back shares to the Investment Company at a
discount of 15% to book equity, up to a total amount of CHF 400
million.

"While we believe that the current market environment offers multiple
attractive opportunities for an investment company with liquid funds,
shareholders will be given the choice to either participate in the
value creation potential of the Investment Company, or to sell their
shares back to the Investment Company at an attractive price. While
providing liquidity for shareholders, the buyback program will also
have a stabilizing effect on the share price of the Investment
Company which will be to the benefit of all shareholders which choose
to stay invested," added Christopher Chambers.

Extraordinary Shareholders Meeting
Jelmoli will invite its shareholders to vote on the proposed
strategic plan at an extraordinary shareholders meeting scheduled to
take place at the beginning of November 2008. Once shareholder and
other approvals have been granted, it is envisaged that the shares of
the newly listed Investment Company will be distributed to
shareholders and commence trading in January 2009.

"It has been the goal of the Board of Directors to develop a
strategic solution that is in the best interest of the company and
acceptable to all shareholders. We believe that this proposal, which
the Board of Directors will put to shareholders at the beginning of
November, removes key impediments to value creation and the further
development of both companies. The Board of Directors is convinced
that the presented strategic plan is an attractive and balanced
proposal. It will now be up to shareholders to decide," said
Christopher Chambers.

The completion of the proposal is subject to shareholder approval,
approval by the SWX Swiss Exchange and the Swiss Takeover Board,
filing of the respective listing documents with the SWX and further
legal and tax review.

Contact person

Media: Dr. Jörg Neef, Hirzel. Neef. Schmid. Konsulenten
+41 79 405 56 32, eMail: joerg.neef@konsulenten.ch
Internet: www.jelmoliholding.ch / www.huginonline.ch/JEL
WAP mobile: wap.huginonline.com (Press Releases Jelmoli)
E-mail: info@jelmoliholding.ch

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WKN: 851225; ISIN: CH0000668464; Index: SMCI, SPI, SPIEX;
Listed:
Main Market in SWX Swiss Exchange;
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