Citycon Board of Directors decides on a rights issue

Stock exchange releases - 10 September 2007


CITYCON OYJ Stock Exchange Release 10 September 2007 at 9.30 a.m.

NOT FOR DISTRIBUTION IN THE UNITED STATES, CANADA, JAPAN OR AUSTRALIA

The Board of Directors of Citycon Oyj has today decided on a rights issue
amounting to approximately EUR 99 million (the "Offering") based on the
authorisation granted by the Annual General Meeting of 13 March 2007. Citycon
will offer a maximum of 27,594,782 new shares in accordance with shareholders'
pre-emptive subscription right. The shares to be issued in the Offering
represent a maximum of approximately 14.3 percent of the total shares and the
voting rights in the Company prior to the Offering.

The share subscription period will commence on 19 September 2007 and expire on 3
October 2007. The subscription price is EUR 3.60 per share. Each shareholder of
Citycon is entitled to subscribe for one (1) new share for every seven (7)
shares held on the record date, 13 September 2007. The subscription rights are
transferable and are expected to be traded on the Helsinki Stock Exchange from
19 September 2007 through 26 September 2007. OKO Corporate Finance Ltd. will act
as the Lead Manager of the Offering.

Citycon intends to continue its strategy of responsible growth by expanding the
Company's property portfolio in the retail business and selected market areas
and by developing and redeveloping the company's properties in order to better
serve the retail sector. The most desirable acquisition targets are shopping
centres that offer substantial development and redevelopment potential and
possibilities for increasing rental yield through active retail property
management. Citycon's new investments are focused in areas where the number of
inhabitants and their purchasing power are expected to increase.

In the execution of its growth strategy Citycon intends to utilise equity,
equity-linked financing as well as debt financing in a flexible manner in order
to ensure optimal balance sheet structure of the company taking into account the
progression of its investment plans. In addition, investments can be financed by
divesting non-core properties.
The net proceeds of the Offering are intended to be used to partially finance
the acquisition of the shopping centre Iso Omena announced in August. The
acquisition is expected to be closed during September 2007. The purchase price
of Iso Omena is approximately EUR 329 million and the acquisition will initially
be financed with existing credit lines and new financing arrangements.

Gazit-Globe Ltd. has informed Citycon that its holding in Citycon as of 4
September 2007 was 39.3 per cent of all the shares in Citycon and has informed
Citycon of its non-binding intention to use its subscription rights and to
subscribe for shares in the Offering. In addition, Gazit-Globe Ltd. has informed
Citycon of its non-binding intention to participate in the secondary
subscription.

Amendments to terms and conditions of stock options and convertible capital
bonds
The Board of Directors of Citycon has today approved the share subscriptions
made and paid by 3 September 2007 based on the Company's 1999 stock options. The
new shares are intended to be recorded in the book-entry accounts of the
subscribers prior to the record date for the Offering, on or around 11 September
2007.

The stock options 1999 and 2004 that have not been used for share subscription
do not entitle to participate in the Offering. In order to ensure equal
treatment of the stock option holders and the shareholders, the Board of
Directors of Citycon has today decided on amendments to the terms and conditions
of the 2004 stock options due to the Offering. In addition, the Board of
Directors of Citycon decided to adjust the conversion price of the convertible
capital bonds listed on 22 August 2006. The amendments described above regarding
the convertible bonds will take effect on 4 October 2007 and regarding the stock
options on 10 October 2007 provided that the Offering will be executed in
accordance with the terms presented above. Since the Company's stock option
scheme 1999 expires on 30 September 2007, the Offering has no effect on the
terms and conditions of the said stock option scheme. More detailed information
on said amendments will be provided in a separate release to be issued later
today.

Press conference for media and analysts
Citycon will host a news conference for media and analysts at 12.00 noon today.
The conference will be held at the Company's head office, Pohjoisesplanadi 35
AB, third floor, Helsinki. The news conference may also be attended via
conference call. The details for the conference call are as follows: Conference
number +358(0)9 8248 2775, PIN 8584.

Helsinki, 10 September 2007

CITYCON OYJ
Board of Directors

APPENDIX: Terms and conditions of the Offering

For further information, please contact:
Petri Olkinuora, CEO, tel. +358 9 6803 6738 or
mobile +358 400 333 256

Eero Sihvonen, CFO, mobile +358 50 557 9137

Distribution:
Helsinki Stock Exchange
Major media
www.citycon.fi

This release is not an offer of securities for sale in the United States. The
securities referred to herein may not be offered or sold in the United States
absent registration under the U.S. Securities Act of 1933, as amended, or an
exemption from registration. Any public offering of securities to be made in the
United States will be made by means of a prospectus that may be obtained from
the issuer and that will contain detailed information about the company and
management, as well as financial statements. The issuer does not intend to
conduct a public offering in the United States or register any part of the
offering in the United States. Copies of this release are not being made and may
not be distributed or sent into the United States, Canada, Japan or Australia.

APPENDIX: TERMS AND CONDITIONS OF THE OFFERING

On 13 March 2007, the Annual General Meeting of Citycon Oyj (the "Company" or
"Citycon") resolved to authorise the Company's Board of Directors to decide on a
share issue. The maximum number of shares to be issued may be 100,000,000 in
total.

On 10 September 2007, the Board of Directors of the Company resolved, based on
the authorisation of the Annual General Meeting, to issue a maximum of
27,594,782 new shares (each "Share") through a share issue based on the
pre-emptive subscription right of shareholders (the "Offering") as set forth in
these terms and conditions of the Offering.

The Shares to be issued in the Offering represent approximately 14.3 per cent of
the total shares and voting rights in the Company before the Offering.

Right to Subscribe

Primary Subscription Right

The Shares will be offered for subscription by the shareholders of the Company
in proportion to their shareholding in the Company.

A shareholder who is registered in the Company's shareholders' register
maintained by the Finnish Central Securities Depository Ltd. on the record date
of 13 September 2007 of the Offering (the "Record Date"), will automatically
receive one (1) freely transferable subscription right as a book-entry (ISIN
FI0009503023) (the "Subscription Right") for every one (1) share owned on the
Record Date (the "Primary Subscription Right"). A shareholder, or a person or an
entity to whom such Primary Subscription Rights have been transferred, is
entitled to subscribe for one (1) Share for every seven (7) Subscription Rights.
No fractions of Shares will be allotted.

Secondary Subscription Right

Further, a shareholder who is registered in the Company's shareholders' register
on the Record Date and who has exercised his or her Primary Subscription Right,
is entitled to subscribe for Shares not subscribed for by virtue of the Primary
Subscription Right (the "Secondary Subscription Right").

Shares Not Subscribed for

The Shares not subscribed for may be allocated for subscription by persons
selected by the Board of Directors.

Subscription Price

The Shares may be subscribed for in the Offering at the subscription price of
EUR 3.60 per Share (the "Subscription Price"). The Subscription Price will be
recorded in its entirety under the invested unrestricted equity fund. The Share
Subscription Price has been set such that it includes a discount of
approximately 22 per cent compared to the closing price of the shares on the
trading day preceding the day of the decision on the share offering.

Subscription Period

The subscription period will commence on 19 September 2007 at 9.30 a.m. Finnish
time and expire on 3 October 2007 at 4.30 p.m. Finnish time (the "Subscription
Period").

The Shares that have not been subscribed for by virtue of the Primary and
Secondary Subscription Period and that are to be offered for subscription by
persons selected by the Board of Directors, must be subscribed for in accordance
with the instructions given by the Board of Directors, however, on 8 October
2007 at the latest.

Places of Subscription

Subscriptions can be made at:

- the OP Bank Group's member banks and the offices of Helsinki OP Bank
Plc during their opening hours.
- the OP 0100 0500 telephone service. The clients subscribing for Shares
via the telephone service must have a personal Internet service agreement with
the OP Bank Group. When subscribing for Shares via the telephone service, the
subscriber must identify himself by using the codes for Internet services.

In addition, subscriptions may be submitted to the account operators who have an
agreement with OKO Corporate Finance Ltd. on the routing of subscriptions.
Account operators may ask their customers to submit their subscriptions at an
earlier date than the date of expiration of the Subscription Period.

Subscription for Shares and Payments

A holder of the Subscription Rights may participate in the Offering by
subscribing for Shares pursuant to the Subscription Rights registered on his or
her book-entry account and by paying the Subscription Price. Each seven (7)
Subscription Rights entitle their holder to subscribe for one (1) Share.
Fractional Shares cannot be subscribed. In order to participate in the Offering,
a holder of the Subscription Rights must submit a subscription assignment in
accordance with the instructions given by his or her own account operator, or if
a holder of the Subscription Rights has not received instructions for
subscription form his or her account operator, he or she must contact a
subscription place. The Subscription Price of the Shares subscribed for in the
Offering shall be paid in full at the time of submitting the subscription
assignment in accordance with the instructions given by the subscription place
or the relevant account operator during the term of payment determined by the
account operator.

Shareholders and other investors participating in the Offering whose shares or
Subscription Rights are held through a nominee must submit their subscription
assignments in accordance with the instructions given by their custodial nominee
account holders.

Any exercise of the Primary Subscription Right and the Secondary Subscription
Right is irrevocable and may not be modified or cancelled otherwise than as
stated in section "Cancellation of Subscriptions under Certain Circumstances".

Any Subscription Rights remaining unexercised at the end of the Subscription
Period on 3 October 2007 will expire without any compensation.

Cancellation of Subscriptions under Certain Circumstances

According to the Finnish Securities Market Act if the prospectus relating to the
Offering is supplemented between the time the prospectus was approved by the
Finnish Financial Supervision Authority and the time when trading with the
Shares begins due to a material mistake or inaccuracy relating to the
information in the prospectus which could be of material relevance to the
investor, then investors who have already agreed to subscribe for Shares before
the supplement is published, shall have the right to withdraw their
subscription. The procedure for such withdrawal right will be announced together
with any such supplement to the prospectus through a stock exchange release.

Public Trading of the Subscription Rights

The Subscription Rights will be publicly traded on the OMX Nordic Exchange
Helsinki Ltd. between 19 September 2007 and 26 September 2007.

Approval of the Subscriptions

The Board of Directors of the Company will approve all subscriptions pursuant to
the Primary Subscription Right made in accordance with these terms and
conditions and applicable laws and regulations.

In case of over-subscription by virtue of Secondary Subscription Rights, the
subscriptions made by the Company's shareholders will be approved in proportion
to their holdings on the Record Date, but not more than up to the maximum number
of the subscription undertaking. Should the shareholder not receive all Shares
subscribed for by virtue of the Secondary Subscription Right, the subscription
price for the Shares not received by the shareholder will be repaid to the bank
account informed by the shareholder in connection with the subscription on or
about 10 October 2007. No interest will accrue for the repayable funds.

If all Shares are not subscribed for pursuant to the Primary and Secondary
Subscription Right and if the Board of Directors gives the unsubscribed Shares
for subscription to a party it decides, the Board of Directors may in its
discretion approve or refuse these subscriptions.

The Company will publish the final result of the Offering in a stock exchange
release on or about 8 October 2007.

Registration of the Shares to the Book-entry Accounts

The Shares subscribed for in the Offering will be recorded on the subscriber's
book-entry account after the registration of the subscription as interim shares
(ISIN Code FI0009015648) representing the new Shares. The interim shares will be
combined with the Company's existing class of shares (ISIN Code FI0009002471)
when the Shares have been registered with the Trade Register. Such combination
is expected to occur on or about 10 October 2007. The Shares subscribed for and
approved by virtue of the Secondary Subscription Right will be recorded on the
subscriber's book-entry account after the registration of the Shares with the
Trade Register, on or about 10 October 2007.

Shareholder Rights

The Shares will entitle their holder to full dividends declared by the Company,
if any, and to other shareholder rights in the Company after the new Shares have
been registered with the Trade Register, on or about 10 October 2007.

Treatment of Holders of Stock Options and Convertible Bonds

According to the terms and conditions of the stock options approved by the
Company's Annual General Meeting of Shareholders on 15 March 2004, if the
Company increases its share capital on the basis of the pre-emptive subscription
rights of shareholders prior to subscription of shares by the holder of stock
options, such stock option holder shall be granted the same or an equivalent
right as the shareholders. In order to ensure equal treatment of the stock
options holders and the shareholders the Board of Directors of the Company has
on 10 September 2007 decided upon amendments to the subscription ratio and the
subscription price based on 2004 stock options due to the Offering. The
Company's stock options 2004 do not entitle to participate in the Offering.

According to provision 6(b)(iv) of the terms and conditions of Citycon's
convertible capital bonds listed on 22 August 2006, the conversion price of the
convertible bonds shall be adjusted, among other things, when the Company issues
its shares to its shareholders at a price which is less than 95 per cent of the
market price of the shares. According to provision 6(f) of the terms and
conditions of the convertible bonds the Company must give notice of any
adjustments to the conversion price to bondholders after the determination of
the adjustment. The Company's Board of Directors has in its meeting on 10
September 2007 decided to adjust the conversion price of the convertible bonds
from EUR 4.3432 to EUR 4.20, provided that the Offering is executed as described
in the offering note. The new conversion price will be effective as of 4 October
2007. The notice regarding the conversion will be given to the holders of
convertible bonds on 11 September 2007.

Information

Documents mentioned in Chapter 5, Section 21 of the Finnish Companies Act are
available for review as of the start of the Subscription Period at the head
office of the Company, Pohjoisesplanadi 35 AB, FI-00100 Helsinki.

Applicable Law and Dispute Resolution

The Offering and the Shares shall be governed by the laws of Finland. Any
disputes arising in connection with the Offering shall be settled by the court
of jurisdiction in Finland.

Other Issues

Other issues and practical matters relating to the Offering will be resolved by
the Board of Directors of the Company.


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