Zapf Creation AG successfully completes capital increase against cash contributions

Inflow of funds is an important element of the Company's long-term financing package

Roedental, Germany, October 31, 2007 (euro adhoc) -

ots.CorporateNews transmitted by euro adhoc. The issuer is responsible for the content of this announcement.

Zapf Creation AG, Europe's
leading manufacturer of play and functional dolls, has successfully completed its previously announced cash capital increase from authorized capital.

A total of 3,200,002 no-par bearer shares ("New No-Par Shares") were issued to the Company's shareholders against cash contributions during the subscription period from October 12 to 26, 2007. The subscription price was EUR 3.16 per New No-Par Share. The New No-Par Shares are entitled to participate in profits from January 1, 2007.

The shareholders of Zapf Creation AG exercised approximately 75 percent of the subscription rights. The remaining 25 percent of the New No-Par Shares were purchased by the Company's major shareholders - MGA Entertainment, Inc. and companies and persons affiliated with it, and Mr. Nicolas Mathys - at a price equivalent to the subscription price. Prior to the capital increase, the major shareholders had undertaken to guarantee the placement of up to 3,200,002 New No-Par Shares.

As a result of the successful completion of the cash capital increase, the share capital of Zapf Creation AG has increased from EUR 8,799,998 to EUR 12,000,000. The capital increase was recorded in the Commercial Register today. The total proceeds for the Company before deducting transaction-related expenses were EUR 10.1 million. This cash inflow is an important element of the long-term financing package of Zapf Creation AG.

Further information:
Frank Elsner/Jens Heinen
Frank Elsner Kommunikation für Unternehmen GmbH
Tel.: +49 (0) 54 04 - 91 92 0
Fax: + 49 (0) 54 04 - 91 92 29

Zapf Creation AG is Europe's leading manufacturer of play and functional dolls with accessories. Among Zapf Creation's best known brands are Germany's best-selling functional doll BABY born®, 13 million of which have been sold worldwide since 1991, plus Baby Annabell® and CHOU CHOU. All these branded toys have in common the highest standards of design, quality, safety and play value. Headquartered in Roedental, Germany, Zapf Creation was founded by Max Zapf in 1932 and went public in April 1999 (ISIN 0007806002). For further information, please visit:

Further inquiry note:
Zapf Creation AG
Janina Scholz
Mönchrödener Straße 13
96472 Rödental, Germany
Tel: +49 9563 725-1513

end of announcement euro adhoc

emitter: Zapf Creation AG
Mönchrödener Straße 13
D-96472 Rödental
phone: +49 (0)9563 7251-0
FAX: +49 (0)9563 7251-387
sector: Consumer Goods
ISIN: DE0007806002
indexes: CDAX, Classic All Share, Prime All Share
stockmarkets: official dealing/prime standard: Börse Frankfurt, free trade:
Börse Berlin, Börse Hamburg, Börse Stuttgart, Börse Düsseldorf, Börse Hannover, Börse München
language: English