euro adhoc: SkyEurope Holding / Capital measures / SkyEurope announces significant financing led by York Global Finance II S.à r.l. - EUR 56.3 million of capital to be raised: EUR 38.8 million from Y

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Disclosure announcement transmitted by euro adhoc.
The issuer is responsible for the content of this announcement.
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28.08.2006

NOT FOR DISTRIBUTION IN OR INTO THE UNITED STATES

SkyEurope Holding AG ("SkyEurope" or the "Company") has signed an
agreement with York Global Finance II S.à r.l. ("York") under which
York will invest EUR 38.8 million of fresh capital into SkyEurope as
part of a comprehensive EUR 56.3 million equity and equity-linked
financing package.

York Global Finance II S.à r.l. is an affiliate of York Capital
Management, an international private investment fund group with over
EUR 6 billion of assets under management.

The transaction will include several elements:

- Existing and new shareholders will have the opportunity to purchase
10 million new shares of SkyEurope via a rights issue, at a fixed
price of EUR 1.75 per share, pursuant to the approvals received from
shareholders at the General Meeting held on 20 June 2006.

- York will purchase approximately 9 million new shares also at a
fixed price of EUR 1.75 per share. York will own approximately 23%
of SkyEurope’s pro forma shares outstanding after the issuance of
such shares and the rights offering are completed.

- York will purchase approximately EUR 6.7 million of bonds
mandatorily convertible into an additional approximately 3.8 million
new shares of SkyEurope upon receipt of various regulatory approvals.
Receipt of such approvals and conversion are expected to occur within
6 months, during which time the bonds will not bear interest. If
such conversion takes place, York’s pro forma equity stake in
SkyEurope will rise to 29.9%.

- York will purchase a further EUR 17 million nominal amount of
non-mandatorily convertible bonds, with net proceeds to the Company
of EUR 16.4 million.

Three current members of the Supervisory Board of SkyEurope have
resigned and the Supervisory Board has proposed three new members to
be elected.

The issuance of new shares and convertible bonds to York on a
non-preemptive basis as well as the appointment of the new
Supervisory Board members are subject to shareholder approvals, which
will be sought at an Extraordinary General Meeting of Shareholders to
be held on Wednesday, 20 September 2006. The rights issue, which
remains subject to approval by the Austrian Financial Markets
Authority and is a condition precedent to York’s investment, is
expected to be launched in the coming weeks and to close before the
end of September.

Christian Mandl, Chief Executive Officer of SkyEurope, commented: "We
are delighted that an investor with York’s reputation, resources and
experience has chosen to invest in our Company. We look forward to
working closely with York to enhance our position as the leading low
cost carrier in Central & Eastern Europe and to continue the high
quality of service we provide to our valued customers. SkyEurope
management is committed to focus on profitability and to deliver
significant shareholder value."

Christophe Aurand, Chief Executive Officer of York Capital Management
UK Advisors Limited, commented: "York believes SkyEurope is
strategically positioned in highly attractive emerging European
markets which offer significant growth opportunities not available in
most parts of the world. Additionally, SkyEurope’s low cost and
entrepreneurial business model enables a product and service offering
superior to its competitors. We are excited to work with the
management and employees of SkyEurope and to contribute to the
strategic development and profitable growth of the Company."

UBS Investment Bank and CA IB acted as financial advisers to
SkyEurope in connection with the investment by York and will act as
lead managers of the rights issue. Linklaters together with Weber
Maxl & Partners acted as legal advisors to SkyEurope. Allen & Overy
LLP together with Wolf Theiss advised York on the transaction.

About SkyEurope: SkyEurope Holding AG is the holding company of
SkyEurope Airlines, a.s. The company has been listed on the Vienna
and Warsaw stock exchanges (VSE: SKY; WSE: SKY, ISIN AT0000497003)
since 27 September 2005. SkyEurope was founded on 6 September 2001
by Christian Mandl and Alain Skowronek and is the largest low-cost,
low-fare airline in Central and Eastern Europe with bases in
Bratislava, Budapest, Warsaw, Krakow and Prague. SkyEurope operates
a route network of 73 routes to 37 destinations in 19 European
countries and has a fleet consisting of 16 aircraft.

About York Global Finance II S.à r.l: York Global Finance II S.à r.l
is an affiliate of York Capital Management. York Capital Management
is an international private investment fund group with over EUR 6
billion of assets under management. York Capital was founded in 1991
by James G. Dinan and has offices in New York, London and Singapore.
York specializes in high quality, value oriented public and private
equity investments as well as credit securities.

THIS IS NOT AN OFFER TO SELL NOR A SOLICITATION TO BUY ANY SECURITIES
OF SKYEUROPE HOLDING AG. IF AND BEFORE AN OFFER IS MADE, A
PROSPECTUS PREPARED IN ACCORDANCE WITH THE AUSTRIAN CAPITAL MARKET
ACT AND APPROVED BY THE AUSTRIAN FINANCIAL MARKETS AUTHORITY WILL BE
PUBLISHED. ANY SECURITIES ORDERS RECEIVED PRIOR TO THE COMMENCEMENT
OF THE OFFER PERIOD PROVIDED FOR IN SUCH PROSPECTUS WILL BE REJECTED.

NOT FOR DISTRIBUTION IN OR INTO THE UNITED STATES. THE SHARES AND
CONVERTIBLE BONDS REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE
REGISTERED IN THE UNITED STATES AND MAY NOT BE OFFERED OR SOLD IN OR
INTO THE UNITED STATES.

end of announcement euro adhoc 28.08.2006 19:14:36
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ots Originaltext: SkyEurope Holding
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:
SkyEurope Holding AG
Mag. Erhard Schmidt, CFO
Tel.:+421 2 4850 1180
mailto:investor.relations@skyeurope.com
http://www.skyeurope.com

Branche: Air Transport
ISIN: AT0000497003
WKN: A0F5WU
Index: WBI
Börsen: Wiener Börse AG / official market


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