Telia Sells Eight Enterprises Companies to Industri Kapital.

Business Editors

STOCKHOLM, Sweden--(BUSINESS WIRE)--March 28, 2001

In the ongoing process of focusing on the core businesses, Telia has reached an agreement with the Industri Kapital 2000 Fund to sell a 51 percent stake in a group comprising eight companies and their respective affiliates of the Telia Enterprises division. The companies' aggregate enterprise value amounts to 3 200 MSEK and aggregate equity is valued at 1 100 MSEK.

The eight companies currently have 5 622 employees.

"Through this agreement, we continue to broaden the ownership base of the non-core businesses in accordance with our firmwide strategy," says Marianne Nivert, President & CEO of the Telia Group.

The eight companies covered by the agreement are Swedia Networks AB, Telia Prosoft AB, Respons AB, Validation AB, Telia Swedtel AB, Telia Dokumentation AB, Multicom Security AB and TA Teleadress Information AB and their respective subsidiaries.

Under the terms of this agreement, Telia will own 49 percent and the Industri Kapital 2000 Fund 51 percent of the companies. The transaction is expected to close in May, pending competition and regulatory approval by the European Union. Continuity of the businesses is secured by the ongoing commitment of the present management.

"We see a great potential for these businesses to develop, each with respect to its specific competence, in a fast growing and highly dynamic market," says Bjorn Saven, Chief Executive Officer of Industri Kapital. "We also look forward to working together with Telia in further developing these companies."

Telia and the businesses being sold have agreed a tapering supply and volume commitment until the end of 2003 which will provide Telia with the assurance of the availability of important services from these companies during the period, as well as providing commercial support to the businesses while they continue their active development of new clients.

"We appreciate the growth potential arising from this partnership with Industri Kapital," says Marianne Nivert. "We also see significant opportunities for the involved 5 622 employees as the strategic focus of their respective companies will be futuregrowth. Our confidence is demonstrated by our future minority shareholding."

The capital freed by this divestiture will be redeployed into the continued development of the Telia core activities, i.e. mobile services in the Nordics, carrier businesses and portals in Europe as well as broadband in Sweden. Following the agreement with Industri Kapital, Telia will have approximately 25 000 employees.

Telia has previously divested or increased the number of shareholders in the following companies: In Good Company AB, Telia Trading AB, Telia Kompetens, Svefo AB, Combinator IT AB, Telia Academy AB, Telia Contracting, Smalandsborsen Data AB, Telia System & Service A/S, Altitun, Starman Kabeltelevisioone AS, Eniro AB and DRS AB.

Industri Kapital is a leading European private equity firm with equity capital under management in excess of 3 billion Euro. Since 1989, more than 40 investments have been made in European companies in various industries. The fund investors are generally large Nordic, European and American institutional investors such as pension funds, investment and insurance companies.

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