AS Starman                 Investor press release                 17 October 2005



MERGER WITH SUBSIDIARIES



AS Starman ("Starman") will, under the merger agreement concluded on 31 May  2005,

merge with the following companies, all of which are Starman's 100% subsidiaries:

   1) AS Levi Kaabel  ("Levi  Kaabel")  (areas  of  activity  and  description  of

      business:  provision  of  cable   television,   telephony,   telemetry   and

      information  services  and  other  telecommunications  services,   including

      planning, construction, maintenance and operation  of  respective  networks;

      director: Jüri Pokk; supervisory board members: Peeter Kern, Rändy Hütsi and

      Indrek Kuivallik);

   2) Tallinna Kaabeltelevisiooni AS ("TKTV") (areas of activity  and  description

      of  business:  provision  of  cable  television,  telephony,  telemetry  and

      information services, including  planning  and  construction  of  respective

      networks; director: Jüri Pokk; supervisory board members: Peeter Kern, Rändy

      Hütsi and Indrek Kuivallik);

   3) AS  Telset  Telecommunications  Group  ("Telset")  (areas  of  activity  and

      description of business: provision of telecommunications services (including

      consultations) in  multimedia  networks;  design,  assembly,  operation  and

      maintenance of satellite signal  reception  systems;  production,  sale  and

      translation of voice and  television  commercials;  creation  of  commercial

      servers and sale of their services; director: Jüri Pokk;  supervisory  board

      members: Peter Kern, Rändy Hütsi and Indrek Kuivallik).



On 12 May 2005, Starman acquired the shares of Levi Kaabel (including  the  shares

of Telset, a 100% subsidiary of Levi Kaabel) from Tele2  OÜ  and  made  the  first

instalment of the purchase  price.  On  27  May  2005,  Starman  made  the  second

instalment and acquired a 100% holding in AS Levi  Kaabel  and  TKTV.  On  31  May

2005, Starman acquired a 100% holding in Telset  from  Levi  Kaabel.  Starman  has

already controlled the activities of the subsidiaries from 2004  and  no  business

activities are carried out in the subsidiaries as of 2005.  Starman  acquired  the

subsidiaries in order to cut down on  expenses  relating  to  the  management  and

overlapping activities of the subsidiaries by merging  their  business  activities

completely with those of Starman. The 2004 financial results of  the  subsidiaries

are recorded in the consolidated annual report of Starman.  The  merger  will  not

alter the activities of Starman.



Pursuant to the merger agreement entered into on 31 May 2005, Starman  will  merge

with its subsidiaries Levi Kaabel, TKTV and Telset. As a  result  of  the  merger,

the subsidiaries will be dissolved without  liquidation  proceedings  and  Starman

will become their legal successor. Starman will continue its activities under  the

current business name of AS Starman. The share capital  of  Starman  will  not  be

altered as a result of the merger, and the shares of the subsidiaries will not  be

exchanged and will become invalid. According to the auditor's  report  of  6  July

2005 concerning the merger agreement, the merger will not bring about  any  damage

to the interests of the creditors of the subsidiaries.



Rights and obligations arise from the  merger  agreement  after  approval  of  the

agreement by the  merging  companies.  Pursuant  to  subsection  421  (4)  of  the

Commercial Code, approval of the  merger  agreement  by  a  merger  resolution  of

Starman is  not  required  for  the  merger  since  100%  of  the  shares  in  the

subsidiaries are held by Starman. A merger resolution  is  necessary  if  this  is

demanded by the shareholders of Starman  whose  shares  represent  at  least  one-

twentieth of the share capital of Starman. The  merger  agreement,  the  auditor's

report concerning the merger agreement, and the  three  preceding  annual  reports

and activity reports of Starman, Levi Kaabel, TKTV and Telset  are  available  for

examination by the shareholders of Starman at the seat  of  Starman  at  Akadeemia

tee 28, Tallinn, from the  date  of  publication  of  this  press  release.  Those

documents are also  available  on  the  website  of  Tallinn  Stock  Exchange,  at

<a href='http://www.ee.omxgroup.com/prospektid.' target='_blank'>http://www.ee.omxgroup.com/prospektid.</a> As permitted by subsection 393 (2)  of  the

Commercial Code, no merger report has been prepared.



If the shareholders have not requested the calling of  a  general  meeting  within

one month from the date the on which the said documents were  made  available  for

examination, it is considered that the shareholders  of  Starman  do  not  request

that a special general meeting be held for  approving  the  merger  agreement  and

Starman will proceed with the activities necessary for  protecting  and  informing

the creditors pursuant to the requirements  set  forth  in  the  Commercial  Code,

publishing two notices concerning the merger resolution with at  least  a  fifteen

day interval in the official publication Ametlikud Teadaanded and sending  written

notices concerning the merger to the known creditors.



Three months after publication of the second merger notice, the management  boards

of Starman, Levi Kaabel, TKTV and Telset will submit a petition for entry  of  the

merger in  the  commercial  register.  Pursuant  to  subsection  403  (2)  of  the

Commercial Code, the companies being acquired shall be deemed to be  dissolved  as

of entry of the merger in the commercial register.



As set forth in the merger agreement, no  advantages  are  granted  in  connection

with the merger to the members of the management and  supervisory  boards  of  the

companies being acquired.



No court or arbitration proceedings are pending with regard to Levi  Kaabel,  TKTV

or Telset which could have a material adverse effect on their business  activities

and there have been no material changes in the business activities of any  of  the

companies after the end of the previous financial year.



As  of  31  May  2005,  Starman's  obligations  to  its  subsidiaries  under  loan

agreements were as follows: to Telset -  EEK  2,563,000;  to  Levi  Kaabel  -  EEK

3,006,000, to TKTV - EEK 1,359,000. On the date of publishing this press  release,

there are no valid agreements between Starman and its subsidiaries  and  nor  have

Levi Kaabel, TKTV or Telset separately any obligations to  third  parties  arising

from loan agreements.





Rändy Hütsi

Member of the Management Board

+372 677 9977