GTS Commences Restructuring Proceedings.

Business Editors

LONDON--(BUSINESS WIRE)--Nov. 15, 2001

Global TeleSystems, Inc. ("GTS") announced today that, as previously announced, it and its Global TeleSystems Europe BV ("GTS Europe") subsidiary have commenced voluntary, "pre-arranged" reorganisation proceedings in the United States; and that GTS Europe has initiated similar "Surseance" proceedings in the Netherlands. Both of these proceedings were initiated to implement the planned acquisition of GTS's Ebone and GTS Central Europe operating businesses by KPNQwest NV, which was announced on 19 October 2001.

The day-to-day business operations of Ebone and GTS Central Europe will not be involved in these proceedings; the only debt to be restructured under the proposed acquisition and restructuring will be GTS's and GTS Europe's publicly traded bond debt. Both GTS's and GTS Europe's normal trade debt and obligations will be paid in full under these proposed plans of reorganisation. As previously announced, GTS's preferred and common shareholders will not receive any recovery under the terms of its proposed restructuring plan.

Both petitions were filed with the support of the informal committees representing the holders of GTS's and GTS Europe's publicly traded debt. Approximately 67 percent of the approximately (euro)1.1 billion outstanding principal amount of the publicly traded Senior Notes issued by GTS Europe; approximately 78 percent of the approximately (euro)116 million outstanding principal amount of the Senior Notes issued by GTS; and approximately 35 percent of the approximately (euro)362 million outstanding principal amount of Convertible Debentures issued by GTS already have signed forbearance agreements committing them to support the proposed transaction, subject to certain terms and conditions.

Grier C. Raclin, GTS Chief Administrative Officer and General Counsel, commented: "As we previously outlined, these voluntary proceedings are being taken to effectuate the share purchase agreement with KPNQwest. They do not involve any of the other operating subsidiaries of GTS, and both the proposed Dutch and US plans will call for their vendor claims to be paid in full. The day-to-day businesses operations and functions of Ebone and Central Europe will continue as usual and should remain entirely unaffected by these proceedings."

The US proceeding involving GTS, Inc. was implemented by converting the Chapter 7 bankruptcy petition filed previously against GTS, Inc. into a voluntary Chapter 11 plan of reorganisation, with the agreement of the relevant petitioners.

About GTS (www.gts.com)

GTS is the parent company of Ebone, one of the leading broadband optical and IP network service providers in Europe, and GTS Central Europe, one of the leading providers of voice and data services across that region. Ebone's fibre optic network extends more than 25,000 kilometres, reaching virtually every major European city. Ebone also operates one of Europe's leading IP networks. GTS Central Europe has operations in the Czech Republic, Slovakia, Poland, Hungary and Romania. On 19 October 2001, GTS announced that it had signed a definitive share purchase agreement under which KPNQwest ("KPNQwest") (NASDAQ and ASE: KQIP) has agreed to acquire, under the terms and conditions in the agreement and subject to normal regulatory approvals, the business of Ebone and GTS Central Europe. For further information, please visit us at www.gts.com or www.ebone.com.

This press release may include forward-looking statements that involve risk and uncertainty. Although the company believes its expectations and projections reflected in such forward-looking statements are based on reasonable assumptions, no assurance can be given that such projections or expectations, including, without limitation, those relating to its future funding needs, will be fulfilled. Any such forward-looking statement must be considered along with knowledge that actual events or results may vary materially from such predictions due to, among other things, political, economic or legal changes in the markets in which GTS or GTS Europe do business, competitive developments or risks inherent in the companies' business plan. Readers are referred to the documents filed by GTS and GTS Europe with the U.S. Securities and Exchange Commission, specifically the most recent reports filed under the Securities Exchange Act of 1934 and registration statements filed pursuant to the Securities Act of 1933, which identify important risk factors.