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We are pleased to announce that Telekom Malaysia Berhad ("TM") has entered into Share Purchase Agreements with Asian Telecommunication Investments (Mauritius) Limited ("Purchaser") to dispose its entire investment in Usha Martin Telekom Limited ("UMTL") comprising of 37.71% direct and 17.02% indirect interest in shares for a total cash consideration of USD58.75 Million.

Other shareholders of UMTL have also entered into the respective Share Purchase Agreements together with TM to simultaneously dispose a total of 97.5% interest in UMTL.

INFORMATION ON UMTL

In December 1993, TM has signed a joint venture agreement with Usha Martin Group Limited to incorporate UMTL to install and operate a GSM mobile system in Calcutta, India which was launched in July 1996.

UMTL's present paid-up capital is Indian Rupees 536,000,000 consisting of 53,600,000 ordinary shares of Indian Rupee 10 each. It has a GSM subscriber base of about 57,000.

RATIONALE FOR DISPOSAL OF SHARES IN UMTL

The above disposal of interest in shares in UMTL is in line with TM's move to consolidate its strategic investment overseas. The favourable market conditions in India enables TM to dispose the said investment.

FINANCIAL IMPACT

It is estimated that there will be a net gain of RM153.1 Million and RM191.6 Million at the company and group level, respectively arising from the disposal of interest in shares in UMTL for the current financial year ending 31 December 2000.
APPROVALS REQUIRED

The disposal and its completion is subject, inter alia, to approvals from the lenders to UMTL for the transfer of the UMTL shares to the Purchaser. Following the receipt of the said approvals and compliance with other conditions precedent, the transaction was completed on 28th July 2000.

DIRECTORS' AND SUBSTANTIAL SHAREHOLDERS' INTEREST

In so far as the Directors of TM are aware, none of the Directors nor the substantial shareholders of TM have any interest, whether direct or indirect, in the said disposal of shares.