IBM and Finnish Food Company Fazer in International Development, Maintenance and Hosting Agreement

HELSINKI, FINLAND - 15 Sep 2006: IBM (NYSE: IBM) and Fazer Group, a major Finnish catering services, bakery and confectionary products company, today announced an international cooperation agreement for the development, maintenance and hosting of Fazer Group’s MySAP systems. IBM will support the unification and development of Fazer Group’s business processes and applications by providing new solutions based on MySAP technology. Financial terms were not disclosed, but the annual value of the agreement is in the range of several million euros.

Fazer Group operates in three divisions; Fazer Amica, Fazer Bakeries and Candyking, in a total of nine countries including the Nordic and Baltic states, Russia and the UK. The project will create a standardized IT platform that is easy to manage and distribute between the Group’s different divisions. The common platform is a flexible IT solution to accommodate changes in the market, growth and the further internationalization of the Group’s business operations. In addition, it provides Fazer Group with measurable and tangible synergy benefits within IT management as well as cost reductions.

“A global corporation such as IBM has the world-class expertise and know-how we want to utilize. The agreement provides us with IBM’s global network and top-notch experts,” said Mr. Pertti Norjos, VP & CIO of Fazer Group.

Working together, IBM Global Business Services consultants and Fazer Group will develop and enhance Fazer’s corporate-level finance, logistics, sales, human resources as well as division-specific business processes. IBM will take over the implementation, hosting and maintenance of the MySAP solution supporting these processes.

The project incorporates IBM’s international industry-specific best practices to bring about the ultimate IT platform for the Group. With the MySAP solution, IBM also aims to introduce enhanced collaboration methods for Fazer and its external business partners.

“In the growing global consumer goods industry, having the right foundation in place to improve communications between your employees, suppliers and retail partners is vital,” said Mr. Johan Sandell, IBM Country General Manager in Finland. “Fazer’s work with IBM will enable them to focus on their core competencies while building a unified platform to grow their business. IBM will leverage both our deep consultative and technical expertise in the deployment of this project.”

IBM and Fazer have had a strong working relationship since 1996. Currently, IBM hosts and manages Fazer’s SAP solution related to the Group’s financial administration as well as various business applications within different divisions of the Group, and provides AMS services for Fazer’s AS/400 and EDI solutions. The MySAP project is a springboard for future deepening of the cooperation between the two corporations.

About Fazer Group

Fazer Group started from a family concern established in 1891. Today, Fazer provides catering services and bakery and confectionary products in nine different countries. Passion for the customer, quality excellence and team spirit form the basis of the company’s operations. The Group has three business areas, each catering to its own unique line of taste sensations: Fazer Amica, Fazer Bakeries and Candyking. Fazer Amica is the leading catering service company in the Nordic and Baltic countries. Its basic mission is to provide good food and customer-specific service solutions. The company operates in the Nordic countries, Estonia, Latvia and Russia. Fazer Bakeries produces fresh, delicious bakery products in Finland, Sweden, Russia, Estonia, Latvia and Lithuania. Candyking is a Pick ’n Mix candy pioneer and market leader in the Nordic countries and the UK. Cloetta Fazer, the largest chocolate and candy manufacturer in the Nordic countries, is Fazer’s most important affiliate company. In 2005, Fazer Group’s net sales amounted to EUR 986 million. The Group has approximately 14,800 employees.

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Adam Emery

IBM Media Relations

IBM

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