Telecom Argentina says $290 million notes tendered

New York, June 4 - Telecom Argentina STET-France Telecom SA said $290 million of its debt was tendered in its recent offer, according to a preliminary count.

The Buenos Aires, Argentina company said that it is still verifying the precise amount tendered.

Telecom Argentina said $210 million of debt was tendered in its offer and $80 million in Telecom Personal SA's offer.

The tender expired at 4.00 p.m. ET on June 2. The companies expect to pay holders by June 9.

Telecom Argentina also said that it made the interest payments through June 24, 2002 at the contractual rates - not including default rates or penalties. It also paid interest at 30% of the contractual rate, again excluding default rates or penalties, for June 25, 2002 through Dec. 31, 2002.

In total Telecom Argentina paid $96 million and Telecom Personal paid $11 million.

The payments were regardless of noteholders' and creditors' participation in the exchange.

Publicom SA also said that at the expiration of its offer at 4.00 p.m. ET on June $3.7 million principal amount of its debt had been validly tendered and not withdrawn.

The tender offers and the interest payments are the first steps of the companies' plans to restructure their outstanding debt.

As previously announced, following an increase in the price on offer, Telecom Argentina and subsidiary Telecom Personal were offering to spend $310 million and $55 million respectively to buy back their debt in a modified dutch auction.

They were accepting offers at a range of 48% to 55% of the outstanding principal amount.

Under the terms, the offer will reduce Telecom Argentina's debt by between $564 million and $646 million or 23% to 26%. Telecom Personal's debt would be reduced by $100 million to $115 million or 16% to 18%.

The tender applies to Telecom Argentina's $200 million series C medium-term notes due 2002, $100 million series E medium-term notes due 2005, €250 million series 1 medium-term notes due 2003, €190 million series 2 medium-term notes due 2004, €200 million series I medium-term notes due 2004, €250 million series K medium-term notes due 2002, ITL400 billion series F medium-term notes due 2007 and ITL400 billion series H medium-term notes due 2008.

Morgan Stanley & Co. Inc. and MBA Banco de Inversiones SA are acting as dealer managers for the tender offers with MBA acting in Argentina only.

The information agent in the U.S. and Argentina is Georgeson Shareholder Communications Inc. (banks and brokers cal 212 440-9800, others 866 216-0459, in Argentine call 0800 555-4288, 0800 222-1288 or 0800 288-5288 followed by the U.S. toll free 866 216-0459) and the information agent in Europe is GSC Proxitalia SpA (39 06 4217-1777 or toll free in Italy 800 18 99 23).

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