Singapore, 26 August 1998 - Singapore Technologies Telemedia (ST Telemedia) today announced that it has agreed to sell its 35 per cent stake (held by its wholly-owned subsidiary, ST Telecommunications Pte Ltd) in BellSouth New Zealand to Vodafone Europe Holdings BV (a wholly owned subsidiary of Vodafone Group Plc) for approximately NZ$262.5million.

Under the terms of the sale agreement which is subject to approvals, Vodafone will pay approximately NZ$750 million to acquire the BellSouth New Zealand business. Proceeds from the sale will be split proportionately between ST Telemedia and its US investment partner, BellSouth which owns the majority stake of 65 per cent in BellSouth New Zealand.

On ST Telemedia divesting its shares in BellSouth New Zealand, Mr Lee Theng Kiat, President of ST Telemedia said, "We have had a good partnership with BellSouth over the past 4 years and we are very proud of the business that we have built together. BellSouth New Zealand achieved operating profitability and the credit goes to both the management and staff. Our decision to leave New Zealand is timely as we wish to consolidate and concentrate our resources on our new undertakings, in particular, StarHub."

ST Telemedia's partnership with BellSouth in BellSouth New Zealand started back in 1994. It marked ST Telemedia's entry into the telecommunications market in the Pacific Basin. BellSouth New Zealand is New Zealand's only nation wide GSM cellular network. As of 31 July 1998, it has built up a successful base of 120,000 customers, which represents approximately 19 per cent of the total cellular telephone market in New Zealand. The current penetration rate in New Zealand is 17 per cent.