IPO and listing of Estonian Telecom

11.02.1999 TLN

Tallinn Stock Exchange Press Release
February 11, 1999

Estonian Telecom (AS Eesti Telekom) started trading on the main list of the Tallinn Stock Exchange on February 11, 1999, raising the equity market capitalisation of the Estonian exchange by nearly a half to EEK 17.7 billion ($1.3 bln).

The listing of the telecommunications giant took the Tallinn Stock Exchange to the leading position among the Baltic bourses in terms of equity market capitalisation. Lithuanian equity market capitalisation is at $1.1 billion and Latvian at $0.7 billion.

"We are very pleased that the Telecom IPO was completed so successfully in these relatively turbulent times in emerging markets. Demand beyond even the most optimistic expectations shows that Estonia and its leading companies are on the radar screen of international investors," said Gert Tiivas, managing director of the Tallinn Stock Exchange.

"High domestic interest showed that Estonian investors have not forsaken the equity markets as many pundits had concluded. On the contrary, they showed great appetite for Telecom, giving a positive signal for future infrastructure privatizations through the stock exchange," Tiivas added.

Estonian Telecom closed at EEK 115, 35.3 percent up from its initial public offering price, EEK 85. Trading opened at EEK 110. The total turnover of the shares was EEK 166 million ($12 mln) with 1.4 million shares traded.

Estonian Telecom had a positive effect on the overall market, giving a substantial boost to the trading activity. The total market turnover was EEK 182 million ($13.2 mln), which is considerably higher than the average daily turnover of $0.4 million in January. The index TALSE closed 1.46 percent higher at 108.79. Estonian Telecom will be included in the index from Friday, 12.02.1999.

Telecom’s share of the total market capitalisation is 48 percent, decreasing the banking sector dominance on the Estonian market from earlier 65 percent to 40 percent, which gives investors better opportunities for portfolio diversification.

The IPO of Estonian Telecom, the largest Baltic equity issue ever at $222 mln, added many new stock owners to the market. 5,300 new securities accounts were opened in January and first days of February, compared with an average 900 earlier. The total number of stock owners in Estonia is 68,000. More than 8,000 retail investors participated in the IPO. The issue was oversubscribed by 18 times.

Trading in Estonian Telecom GDR-s also started in the SEAQ system in London on Thursday and the company is expected to be listed on the London Stock Exchange on 16.02.1999.

Additional information:

Eva Palu
Head of Investor Relations Dpt
Tel: +372 64 08 840

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