(TGO) BCE And Teleglobe Confirm The Terms Of Their Transaction.

Business Editors

MONTREAL--(BUSINESS WIRE)--June 19, 2000

BCE Inc. (TSE:BCE) (ME:BCE) (NYSE:BCE) (CDNX:BCE) and Teleglobe Inc. (TSE:TGO) (ME:TGO) (NYSE:TGO) announced today that an agreement has been reached to revise certain terms of BCE's offer to acquire all of the outstanding shares of Teleglobe it does not already own.

Under the revised agreement, BCE will provide Teleglobe with US $100 million in financing immediately and additional financial assistance if required prior to the closing of the transaction. Teleglobe shareholders will receive a fixed share exchange ratio for their Teleglobe common shares. BCE has also agreed to eliminate all conditions of the transaction except those provided by law and material regulatory approvals and to accelerate the closing of the transaction. This arrangement will remove uncertainty and permit Teleglobe to proceed with its business plan.

"Our commitment to Teleglobe and this acquisition have never been in question," said Jean C. Monty, Chairman and CEO of BCE. "Recent developments made it clear that BCE would have to provide Teleglobe with additional financial support prior to the closing of the deal. After much consideration and motivated by a sense of fairness to all of our current and future shareholders, BCE approached the independent committee of the board to revise the terms of the transaction."

Gregory S. Oliver, Teleglobe director and Chairman of the Independent Committee of the board said, "After discussions with BCE and a thorough review and investigation of the situation, undertaken by the Independent Committee of the Board on its behalf, the board of Teleglobe concluded that it was in the best interest of all Teleglobe shareholders to remove the uncertainty over the outcome of the transaction and ensure Teleglobe's ability to pursue its GlobeSystem capital expenditure program." He added that the board of directors, based on the advice of its financial advisors concluded that the revised agreement is fair from a financial point of view to Teleglobe's non-BCE shareholders.

Teleglobe has been in on-going negotiations with its lenders to renew its credit facility of US $750 million. Due to its continued overall financial weakness, Teleglobe could have been in default of bank covenants prior to the closing of the transaction, unless BCE agreed to provide additional financial support. This additional support was not part of the original agreement announced February 15, 2000.

Under the revised offer, Teleglobe shareholders will now receive a fixed exchange ratio of 0.91 of a BCE share (less nominal cash consideration per share) for each Teleglobe common share they own. Teleglobe shareholders can also choose to receive up to 20% in cash for the value of the BCE share component, based on the price of BCE common shares prior to closing.

Teleglobe's two major shareholders, Kenny Troutt and Charles Sirois, who respectively hold 18% and 8% of Teleglobe's common shares outstanding, have agreed to tender their shares under the terms of the revised agreement.

The revised agreement would represent a purchase price of CDN $6.4 billion based on the BCE share price of CDN $35.05 at the close of markets on Friday, June 16, compared with CDN $6.8 billion under the original agreement also based on Friday's close.

Mr. Monty added, "The new agreement recognizes BCE's additional commitment and paves the way for renewed focus for Teleglobe to proceed with its business plans. In pursuing a global strategy, BCE chose to buy Teleglobe because of its significant market presence, its strong position in global Internet transmission and the vision of its GlobeSystem project. While we recognize that the challenge is significant, we are intent on our goal of transforming Teleglobe into a leading-edge, global, data/IP company."

Teleglobe expects to mail by mid-September the proxy circular for the special shareholders meeting to approve the transaction. The special meeting of Teleglobe's shareholders and the closing of the transaction are expected to take place in mid-October.

Under the original all-share agreement, it was hoped that the transaction could be structured in a non-taxable manner for U.S. and Canadian shareholders. Due to the financial support that BCE will be providing to Teleglobe prior to the closing of the transaction, the parties have determined that the transaction will be taxable to U.S. shareholders. As contemplated in the original agreement, the revised agreement provides a 20% cash component to assist in the payment of taxes.

Status of Transaction

BCE has received approval from the U.S.. Federal Trade Commission (Hart-Scott-Rodino Antitrust Improvement Act). Decisions from the U.S. Federal Communications Commission, the Canada Competition Act and the U.S. State Public Utilities Commissions are expected by the end of the 3rd quarter.

BCE is Canada's largest communications company. Through its operations in communications services, BCE provides residence and business customers in Canada with wireline and wireless communications products and applications, satellite communications and direct-to-home television services, systems integration expertise, electronic commerce solutions, Internet access and high-speed data services, and directories. Abroad, through Bell Canada International's investee companies, BCE provides communications services to nearly 6 million customers in Asia and Latin America. BCE also has an extensive international presence through Teleglobe, an international telecommunications carrier. BCE shares are listed in Canada, the United States and Europe.

Teleglobe Inc. is a leading global provider of broadband services with the most extensive global Internet network. Delivering advanced broadband applications to customers in more than 100 countries -matching global reach with global depth - Teleglobe is the premier communications architecture for the digital economy. Its GlobeSystem initiative will provide 160 cities around the world with scalable broadband service platforms and link them through a seamless data network.

Note: Certain statements made in this press release, which describe BCE's or Teleglobe's intentions, expectations or predictions, are forward-looking and are subject to important risks and uncertainties. The results or events predicted in these statements may differ materially from actual results or events. Factors which could cause results or events to differ from current expectations include, among other things: the impact of rapid technological and market change; increasing competition; general industry and market conditions and growth rates; international growth and global economic conditions, particularly in emerging markets, including interest rate and currency exchange rate fluctuations; the level of expenditures necessary to maintain quality of service, the availability and cost of capital, and the extent of demand for traditional and emerging services; the Internet economy growing at a slower pace than is currently anticipated as well as changes in laws or regulations governing Internet commerce; and the impact of consolidations in the telecommunications industry. For additional information with respect to certain of these and other factors, see the reports on Forms 6-K and 40-F filed by BCE or Teleglobe with the United States Securities and Exchange Commission. BCE or Teleglobe disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.