HISTORY

Kav Orman Sanayii A.Ş. was established on June 09, 1970. The initial capital was TL 5 millions. At the beginning, the establishment of the company has been realised by match production for the purpose that it might be converted into an integrated wood industry in the future.
The capital of the company was raised to TL 15 millions in 1971 and TL 30 millions in 1972 respectively.
The match factory has been planned in two continuous lines at the beginning and installed in the same way. However, the third continuous line was added in 1976 and then, the production capacity went up by 50 %. Subsequently, the capital of the company was increased to TL 120 millions and TL 240 millions in 1983 and 1984 respectively. In the context of the Investment Incentive Certificate obtained in the same year, the investment of the fourth continuous line due to have provided an additional increase of 33 % on the capacity has taken effect and put into operation in 1985.
As a result of Kav/Turkey merger in 1986, the factory at Istinye was moved in Orhangazi/Bursa. A fixed investment of TL 2.5 billions was pushed ahead for the construction of the covered space of 5.700 sqm. and modernisation program of the installations and completed in 1987. The capital of the Company was increased to TL 400 millions. The operations of Turkey factory were entirely ceased as of 01.08.1987 and moved in Orhangazi and then put into operation accordingly.
The capital of the Company went up TL 1.200 millions in 1987, TL 3.000 millions in 1988, TL 6.000 millions in 1999, 12.000 millions in 1991 and then, TL 39.000 millions in 1992 in their respective terms.
It was decided by the Board of Directors in March 1990 for the company also to deal with the production of corrugated paper then. The related factory was established at Inegöl Industrial Zone on a land of 73 acres and formally started its operations on September 10, 1991. The company turned out to be an industrial corporation both producing match and corrugated paper.
The capital was increased to TL 62.400 millions in 1992 and TL 156.000 millions in 1995. A partnership protocol was signed on July 27, 1995 with an American Company titled as Union Camp and then, the machinery and installations of corrugated paper and Paper Box Factory located in Inegöl were put as the capital in kind for the new company established on March 18, 1996 under new title : Kav Ambalaj Sanayi ve Ticaret A.Ş. of which we hold a share proportion of 50 %. In the meantime, the real estates were sold to this newly established company. Following this sale, our capital was increased to TL 2.340.000 millions and our shareholders have been given share certificates at a ratio of 1/14 on free of charge basis.
One of the continuous lines at our match factory was sold to a company titled as Astana Kav Ram Too in 1997. Then it was initiated to be a shareholder of this company by 35 %, in return to a Know-How agreement, however, withdrawn from such a partnership due to the fact that the relevant agreement was not approved by the competent authorities of Kazakstan.
The Board of Directors made a resolution on October 07, 1997, in the direction of establishing company on a joint basis with the Swedish firm, Swedish Match AB and the proposed company was established on April 21, 1998 under the title of Swedish Match Kav Kibrit ve Çakmak Endüstrisi. 60 % of the shares of this company would belong to Swedish Match and 40 % to Kav. Orhangazi Kibrit Tesisleri (Orhangazi Match Factory) has been put as a capital in kind in the newly established company, and the existing real estates and inventories have been sold as well. The profit, arisen out of this sale was added to the capital, as a result, the capital was raised to 6.435.000 millions and the shareholders were given the share certificates on free of charge basis, by 1/1.75 ratio.
It was decided at the Extraordinary General Assembly Meeting held on May 28,1999 to change the title of the company to “Kav Danışmanlık Pazarlama ve Ticaret Anonim Şirketi” as well as the field of operation and object, to consultancy and marketing, and that this resolution was registered on June 06, 1999 accordingly.
On July 15, 1999, 50 % of our shares in Kav Ambalaj Sanayi ve Ticaret A.Ş. were sold to Hacı Ömer Sabancı Holding A.Ş. at a value of $ 11 millions, and the profit of TL 2.871.674 millions obtained out of this sale was entered in cost increase fund. The amount of $ 5.1 millions (TL 2.216.468 millions) obtained from International Paper Company in return to waiving the rights already born, was entered as income.
On the date of February 24, 2000, 40 % of our shares in Swedish Match Kav Kibrit ve Çakmak Endüstrisi was sold to Svenska Tandstickbolaget AB at a value of $ 7.4 millions and the profit amounting to TL 2.288.042 millions obtained from this sale entered as an income.