BAHRAIN, 25 November 2002 — Investcorp, the global investment group with offices in Bahrain, London and New York, yesterday announced its plans to issue 400 million additional ordinary shares. Accordingly, the board of directors of Investcorp Bank E.C. is inviting existing ordinary shareholders to exercise their preemptive rights over 400 million ordinary shares for an issue price of $1.75 per share. The issue has been underwritten by a group of prominent strategic underwriters, according to an Investcorp press release.

Investcorp is raising additional capital to supplement its existing robust capital structure. “The additional capital will provide a strong financial platform that will support the growth of each of the bank’s four lines of business, in line with the Bank’s strategic plan to maintain its position of global leadership in the field of alternative investments,” the statement added.

Nemir A. Kirdar, president and CEO, labeled the rights issue as the first step in the next phase of Investcorp’s development and growth. “As we progress into the 21st century, Investcorp is ideally positioned to take advantage of opportunities arising from the increasing globalization of financial markets and investors worldwide. The additional capital provided by this rights issue will further cement Investcorp’s solid reputation and track record, and will help it emerge as a powerful global manager of alternative assets with an international reach,” he said.

Renowned as one of the region’s premier investment institutions, Investcorp has a 20-year track record of highly successful operations and profitability. Investcorp’s initial capital — $50 million raised in 1982 and an additional $50 million raised in 1986 — has grown to $1.15 billion today. Of this amount, $345 million has been paid out in dividends. Since 1982, the bank has conservatively invested its capital to complete 63 corporate and 68 real estate transactions for over $19 billion in aggregate value. Currently, Investcorp has around $5 billion of client and proprietary assets under management in corporate and real estate investments.

Investcorp has a robust business model founded on four well-developed and diverse lines of business. The firm’s capital adequacy ratio is over 21 percent with liquid assets comprising over 50 percent of the asset base, and it is conservatively guided by an executive management team of exceptional experience and depth.

The 400 million additional shares will initially be available in a rights offer to Investcorp’s existing ordinary shareholders, whose names appear in its shareholder register as of the record date of Nov. 29, 2002. The subscription period will begin on Nov. 30, closing on Dec. 15, 2002. During this period, each ordinary shareholder will be able to exercise the right to purchase one new share for each existing ordinary share owned as of the record date. Shares that are not purchased by ordinary shareholders during the rights offer period will subsequently be purchased by an underwriting group.

The rights offer price of $1.75 per share takes into consideration various market conditions and other factors, including the recent eighteen-month rolling average share price, net book value inclusive of fair market value adjustments on the Firm’s investment portfolio, peer comparisons; and the valuation derived from a discounted cash flow analysis.

Investcorp’s ordinary shares will be suspended from trading on the Bahrain Stock Exchange from Nov. 30 to Dec. 24, 2002 or later, until all of the required procedures for the subscription are completed. There will be no suspension in trading of Investcorp’s preference shares.

An extraordinary general meeting of the shareholders of Investcorp is scheduled in Bahrain on Dec. 21 to ratify the underwriter’s allocation and pricing.