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E-Plus Hutchison wins UMTS licence in Germany

KPN Mobile will obtain Hutchison's share

Mainz, The Hague, August 17, 2000/Hong Kong, August 18, 2000, 04:10 hs - E-Plus Hutchison, the consortium formed by Dutch operator KPN Mobile and Hutchison Whampoa Limited, is pleased to announce that at the end of the UMTS (Universal Mobile Telecommunications System) auction in Germany, it has bid successfully for two frequency blocks in total of 10 Mhz per spectrum at a total bid of 8.394 billion to operate a UMTS licence in Germany.

KPN Mobile N.V. and Hutchison Whampoa Limited also announce that they have agreed that subsequent to the auction that KPN Mobile will obtain Hutchison's interest in the E-Plus Hutchison consortium. KPN Mobile will own 100% of E-Plus Hutchison and Hutchison will no longer participate in the consortium to operate a 3G German licence.

Canning Fok, Group Managing Director of Hutchison Whampoa Limited said, "We congratulate KPN Mobile who are now well-placed to operate a high quality 3G service throughout Germany. As a new entrant to the German market the cost of the licence is higher than Hutchison had anticipated, moreover 15 Mhz was the preferred licence for the two operators together and we concluded after the auction that 10 Mhz will not be sufficient. Transfer of our interest to KPN Mobile, allows KPN Mobile to pursue its strategic objective in Germany, where they already have a substantial presence through E-Plus. We believe that it is the best arrangement for both parties. Hutchison Whampoa Limited remains committed to its strategy to develop a pan European 3G business."

Diederik Karsten, CEO of KPN Mobile said," We are pleased to have been awarded the licence, the price is in line with the E-Plus business plan. Through our presence in Germany, the Netherlands, Belgium and the UK, we believe that we are creating a strong company as a foundation for our growth into a pan European 3G operator. Now that we will own 100% of the licence we are committed with our partner BellSouth in E-Plus and NTT DoCoMo in KPN Mobile to build E-Plus into a competitive UMTS operator. KPN Mobile will carry 77.5% of the license fee and Bell South is participating for 22.5%. We do understand Hutchison's considerations with regard to the licence costs, because it makes a difference if you start as a new entrant or have already built up a position in the market as KPN Mobile did via E-Plus. Moreover the partnership aimed at acquiring a 15 Mhz licence and share the vision that 10 Mhz now is seen as too tight for two operators."

Dr. Horst Lennertz, Member of Management Board of E-Plus, states: "UMTS will make E-Plus a vastly more powerful force than as a GSM-only competitor. UMTS means a new beginning of mobile communications in Germany with equal opportunities and time to market for each player. Since all candidates are "equal" as far as UMTS technology is concerned, the decisive factor in future will be the better offerings for the customer. This is the area in which E-Plus, together with KPN Mobile and the world market leader in the mobile multimedia sector, NTT DoCoMo, have a distinct competitive edge."

Phil Wallace, Managing Director BellSouth Europe/Asia said: "As one of the founding partners of E-Plus, BellSouth is excited to see E-Plus continue as one of the premier communications providers in Europe's biggest market. Today's acquisition of 3G licences ensures the strong company we have helped to build will continue its success and we stand ready to bring our operating experience to E-Plus as they roll out the new 3G network in Germany. "


Media Contacts:

Hutchison Whampoa Limited
Laura Cheung
General Manager, Group Corporate Affairs
Hutchison Whampoa Limited
(852) 21281235

Keith Bradley
Commercial Director
Hutchison 3G UK Limited
(44) 207 499 1886

KPN Mobile N.V.
Marinus Potman
Head Press Office
KPN Royal Dutch Telecom
(31) 70 33 24 528

Catrien van Buttingha
Head of Investor Relations
KPN Royal Dutch Telecom
(31) 70 33 24 585

Mariette Westerwoudt
Head of Investor Relations
KPN Mobile
(31) 70 243 3559

E-Plus Mobilfunk GmbH
Claas Sandrock
Head of Corporate Communications
E-Plus Mobilfunk GmbH
(49) 211 448 47 20

Hutchison Whampoa Limited

Hutchison Whampoa is a Hong Kong-based conglomerate with origins dating back to the 1800s. With a market capitalisation in excess of US$60 billion, Hutchison Whampoa is one of the largest companies in Hong Kong. With over 80,000 employees worldwide, Hutchison Whampoa operates five core businesses in 24 countries: ports and related services; telecommunications and e-commerce; property and hotels; retail and manufacturing; and energy and infrastructure. Hutchison Whampoa's telecommunications businesses and holdings span several continents, and include such diverse products as mobile telephony (voice and data), fixed line services, fibre optics broadband networks, internet services, paging, trunked mobile radio, VSAT and radio broadcasting.

Recently the Group formed a strategic alliance with NTT DoCoMo and KPN Mobile to establish and develop 3G businesses in UK, Germany, France and Belgium. Hutchison had earlier won the bid for the largest 3G licence in the UK and subsequently formed Hutchison 3G UK - a UMTS joint venture company with the alliance partners and TIW, to build and operate a national UMTS network. Meanwhile, the Group is also exploring 3G opportunities in other European countries.

KPN Mobile N.V.

KPN Mobile N.V. is a leading European mobile telecommunications network operator and provider of mobile voice and data services. KPN Mobile is currently active in the Netherlands, Germany (E-Plus), Belgium (KPN Orange), Hungary (Pannon), Ukraine (UMC), and Indonesia (Telkomsel). The acquisition of a 77.5% interest in German operator E-Plus in February 2000 has transformed KPN Mobile into a pan-European operator with approximately 9 million customers as per end of June 2000. Last month it completed a strategic partnership with NTT DoCoMo and announced a strategic co-operation regarding European third generation (3G) mobile multimedia together with NTT DoCoMo and Hutchison. KPN Mobile N.V. is a 85%-owned subsidiary of KPN Royal Dutch Telecom.

E-Plus Mobilfunk GmbH

E-Plus is the third largest operator in Germany headquartered in Dsseldorf, with approximately 5.3 million at the end of July 2000. The company operates a GSM 1800 nation-wide network of approximately 7200 base stations. E-Plus Online is the first integrated Internet service provider. E-Plus has 3700 employees and recorded sales revenues of DM 3 billion in 1999 (under German GAAP).


KPN's partner in E-Plus is BellSouth which owns 22.5 percent of E-Plus. BellSouth is a $26 billion communications service company. It provides telecommunications services, internet, data and e-commerce applications, wireless communications, cable and digital TV, and online and directory advertising to more than 40 million customers in 18 countries worldwide.