British Telecommunications plc Purchases Yellow Book USA, Largest Competitive Yellow Pages Publisher, From VS&A Communications Partners II, L.P.

ROCKVILLE CENTRE, NY--(BUSINESS WIRE)--August 26, 1999--

BT (LSE:BTA, NYSE:BTY), one of the world's leading telecommunications companies and largest directory publishers, today announced it has purchased Yellow Book USA, the largest US independent directory publisher, from VS&A Communications Partners II, L.P., an affiliate of Veronis, Suhler & Associates, Inc., for $665 million in cash.

With circulation of over 19 million, nearly 300 directories and more than 1400 employees in 32 offices, Yellow Book USA is the largest independent publisher of telephone directories in the United States.

Yellow Book's current management team, led by Chairman and Chief Executive Officer Joseph Walsh, will continue to lead the company and direct day-to-day affairs of the organization which will report into John Condron, Managing Director of BT's Yellow Pages. Yellow Book USA will retain its name and branding in the United States.

Condron said, "Yellow Book USA is the most exciting classified information business in the US with an aggressive, energetic and talented management team. They have an outstanding record of business building in the past few years and the synergies achievable with our own highly successful business will enable us to create a new force in this industry with the potential for enormous growth."

"We are excited to partner with BT Yellow Pages, the fastest growing and largest yellow pages publisher in Europe," commented Joseph Walsh, chairman and chief executive officer of Yellow Book USA. "As a global market leader, BT Yellow Pages' interest in

Yellow Book USA is validation of our approach and will accelerate our plans to strategically expand Yellow Book's presence in additional markets. Our goal is to capture the majority of yellow pages references in the US. When we combine Yellow Book's reputation as an aggressive marketer with BT Yellow Pages' advanced systems, sophisticated marketing techniques and brawn, the result is a potent combination that will enable us to achieve our goals more quickly. Our highly successful yellowbook.com web directory will be upgraded utilizing the sophisticated technology of BT's Yell Internet site (www.yell.co.uk). We plan to unite these two portals under a common brand and propel our e-commerce capabilities on to a global platform."

Jeffrey Stevenson, president of VS&A Communications Partners II, L.P., stated, "The sale of Yellow Book USA to BT is a victory for everyone involved. BT Yellow Pages and Yellow Book USA are ideal partners who share the same goals in building a strong and customer-focused directory publishing business, both in the US and abroad. The sale price reflects a significant capital return to our VS&A Communication Partners II, L.P. fund and co-investors from the purchase price paid just two years ago."

Established in 1930, Yellow Book USA has grown continually since 1997 when it was acquired in a management-led buyout in conjunction with VS&A Communications Partners II, L.P., an affiliate of Veronis, Suhler & Associates, Inc., the leading merchant banking firm for the media, communications and information industries. Approximately one of every three Americans east of the Mississippi use Yellow Book directories. In July 1999, Yellow Book USA acquired Yellow Page One, Inc, publishers of 9 directories in the Chicago suburbs. In April 1999, Yellow Book USA acquired Directory Publishers, Inc in Georgia. In July 1998, Yellow Book USA acquired Southern Directory Company, Inc, publishing 29 directories in 5 Southeastern States, and in December 1997, Yellow Book acquired RH Donnelley's proprietary east operations, publishing 43 yellow pages directories in 5 Mid-Atlantic States and Washington DC.

Yellow Book USA publishes community directories, wide-area directories, county directories, city directories, a Business-to-Business directory, and college and university directories.

VS&A Communications Partners manages private equity funds with $1.4 billion under management focused exclusively on equity investments in media, communications and information companies. The fund is affiliated with Veronis, Suhler & Associates, Inc., the leading merchant banking firm for the media, communications and information industries.

Yellow Pages is a division of British Telecommunications plc. The company provides a range of classified business information in the form of printed directories and electronic media to business and residential customers in the UK - and it employs over 3,000 people.

The Yellow Pages brand represents more than just a single directory; it encompasses a range of information sources comprising of Yellow Pages, Talking Pages, Business Pages, The Business Database and Yell.

In the UK the name Yellow Pages is a registered trademark owned by British Telecommunications.