Contents :

• · Defence and Counterclaim
  
  We refer to our announcements dated 14 December 2005 and 16 December 2005 relating to the above proceeding. We wish to announce that our wholly owned subsidiary, Celcom (Malaysia) Berhad (“Celcom”) has, on 16 January 2006, filed its Defence to this proceeding by the Plaintiffs, directors of MCAT (Gen) Sdn. Bhd. (“MCAT”). Celcom has also instituted a Counterclaim against the 5th Plaintiff, Mohd Razi bin Adam, the Chief Executive Officer of MCAT.
  
  The Defence is based on the grounds that (i) there is no concluded contract between Celcom and MCAT as alleged in the Statement of Claim, (ii) the alleged defamatory words on which the action is founded (a) were not published by Celcom, (b) do not identify with or bear any reference to the Plaintiffs and (c) are not capable of being defamatory. Celcom is also relying on the defence of justification and qualified privilege.
  
  The Counterclaim is predicated on an action for (i) breach of the contract of employment between Celcom and the 5th Plaintiff and (ii) breach of fiduciary duties by the 5th Plaintiff whilst an employee of Celcom before joining MCAT as its Chief Executive Officer upon the cessation of his tenure at Celcom on 31 May 2005.
  
  · Striking Out Application
  
  Celcom seeks relief by way of an injunction to restrain the 5th Plaintiff from disclosing confidential information acquired by him during the course of his employment with Celcom as well as damages for breach of contract and/or breach of fiduciary duties as well as an account of profits.
  Celcom has also today filed an application to strike out this proceeding on the grounds that the Statement of Claim discloses no cause of action, is frivolous, vexatious and an abuse of process of the Court. The striking out application is premised on, inter alia, the following grounds: (i) the alleged defamatory words relied on (a) were not expressly pleaded in the Statement of Claim, (b) do not identify with or bear any reference to the Plaintiffs and (c) are not capable of bearing a defamatory meaning and (ii) MCAT has, by a letter dated 13 October 2005, admitted that it was not entitled to launch its pre-paid package and/or advertise any association with Celcom and that it had unilaterally advertised its pre-paid package without the knowledge and consent of Celcom. Celcom is also seeking, in the alternative, to strike out the Plaintiffs’ defamatory claim totalling RM1.01 Billion on the grounds that the same is frivolous, vexatious and an abuse of process.