Acquisition Cost of KONE Shares Acquired Prior to the Demerger

Stock Exchange Release Published 27/01/2006

The Finnish National Board of Taxes has determined the acquisition cost of KONE shares to be 64.5 percent of the initial acquisition cost of shares in demerged Kone Corporation.

According to the advance ruling in 2005 of the Finnish Central Board of Taxation, the acquisition cost of KONE and Cargotec shares is primarily to be considered the part of the acquisition cost of Kone Corporation’s shares that correspond to the proportion of the net assets of Kone Corporation transferred to New KONE and Cargotec. If, however, it is apparent that the proportion of the net assets of KONE and Cargotec substantially differs from the proportion of the current values of KONE and Cargotec shares, according to the advance ruling, the proportion of the current values is secondarily to be used as the basis for dividing the acquisition cost between the shares.

According to The Finnish National Board of Taxes, the difference of the proportion of the net assets of Kone Corporation transferred to New KONE and Cargotec, and the current values of the shares is to be considered substantial enough for the current values of the shares to be used as the basis for dividing the acquisition cost between the shares. According to The Finnish National Board of Taxes, the average weighted trading prices of the first five trading days were very close to the average weighted trading prices of the first trading day, and, hence, that the average weighted trading prices of the first trading day on 1 June, 2005 are to be used in determining the acquisition cost of the shares of KONE Corporation and Cargotec Corporation. The acquisition costs are therefore 64.5 percent (KONE Corporation) and 35.5 percent (Cargotec Corporation) of the initial acquisition cost of the shares, according to the guidelines of The Finnish National Board of Taxes.

Sender:

KONE Corporation

Tapio Hakakari Director, Secretary to the Board

Minna Mars Senior Vice President, Corporate Communications & IR

For further information, please contact:
Sophie Jolly, VP Investor Relations, tel. +358 (0)204 75 4534

KONE is one of the world’s leading elevator and escalator companies. It provides its customers with industry-leading elevators and escalators and innovative solutions for their maintenance and modernization. KONE also provides maintenance of automatic building doors. KONE has annual net sales of approximately EUR three billion and about 27,000 employees. Its class B shares are listed on the Helsinki Exchanges.

www.kone.com

2006-01-27 Acquisition Cost of KONE Shares Acquired Prior to the Demerger

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