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1. We refer to the announcement dated 28 July 2004 by TM regarding the arbitration proceeding instituted by TM against the GoG in respect of TM’s investments in Ghana Telecommunications Company Limited (“GT”).
2. We wish to announce that the GoG and TM have reached an amicable settlement of their international arbitration proceedings.
3. The Settlement Documents were executed on 7 May 2005 between TM, TM International Sdn Bhd (“TMI”), G-Com Limited (“G-Com”), GT and the GoG to resolve all claims and counterclaims brought about by TM and the GoG. TMI is the wholly owned subsidiary of TM, whilst TMI holds 85% equity in G-Com. G-Com in turn holds 30% equity in GT. 4. The settlement sum to be paid by the GoG to TM under the settlement terms will be payable in instalments over approximately two (2) years. Once the full and complete payments are made by the GoG within the abovesaid stipulated period, G-Com’s 30% shares in GT will revert to the GoG. 5. The principal Conditions Precedent to the Settlement Agreement include:
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· The adoption of new regulations (articles of associations) of GT;
· The engagement of KPMG to act as valuation experts on the determination of value of G-Com’s 30% shares in GT;
· The execution of an escrow deed between Deutsche Bank, TM and GoG for acting as escrow agent for G-Com’s 30% shares in GT; and
· Issuance of a letter from the Commissioner of the Internal Revenue Service of the Republic of Ghana in relation to the tax provision under the settlement.
6. Upon fulfillment of the conditions precedent to the Settlement Agreement, the settlement will be recorded in an Award of the Arbitral Tribunal effectively putting an end to the international arbitration proceedings. 7. Financial Effect The settlement will not have any material effect on TM’s Group consolidated earnings for the financial year ending 31 December 2005. 8. Directors’ and Substantial Shareholders’ Interest
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None of the Directors and substantial shareholders of TM and persons connected to them has any interests, direct or indirect, in the settlement.
9. Statement by the Directors
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The Board of Directors of TM is of the opinion that the Settlement Agreement is in the best interest of TM.