Eesti Telekom                 NEWS RELEASE                11/03/2003 10:00



ACQUISITION OF ELTEL NETWORKS



On 31 October 2003, AS Connecto bought 100% of the shares

of  the  Estonian  company Eltel  Networks  AS  from  the

Finnish company Eltel Networks Corporation specialised in

the   construction  and  maintenance  of  electrical  and

telecommunication networks.



On  the basis of a contract between AS Connecto and Eltel

Networks  Corporation,  Connecto  bought  100%  of  Eltel

Networks AS shares. The transition cannot be treated as a

transaction  with  related  party.  Neither  Council  nor

Management  Board  of  Eesti  Telekom  or  any   of   its

subsidiaries  have  no  other personal  interest  in  the

transaction.  The  price  of  the  transaction  was  11,5

million kroon (0,74 million EUR):

Eltel Networks AS was founded in 1999, and its main  area

of   business  is  the  construction  of  electrical  and

telecommunication   networks.  The  turnover   of   Eltel

Networks AS in 2002 was 35,6 million kroons (2,28 million

euros)  and the net profit was 0,21 million kroons (0,013

million  euros).  The company employs  48  people.  Eltel

Networks AS is a subsidiary of Eltel Networks Corporation

(www.eltelnetworks.com) which is  the leading provider of

services  to  networks' owners in  Northern  Europe.  The

three  strong  fields of operations are:  Electrification

Projects, Mobile Networks, and Network Services.  Group’s

net  sales  in 2002 was EUR 208 million, and it  employed

about  1600  people  in  the Nordic  countries,  Baltics,

Russia and in South-East Asia.

AS Connecto(www.connecto.ee) is a 51% subsidiary of Elion

Enterprises  Ltd. Elion Enterprises Ltd is a fully  owned

subsidiary  of AS Eesti Telekom. As for the  turnover  AS

Connecto  is  one of the largest company in the  Baltics,

offering    design,   installation,   construction    and

maintenance services for telecommunication and electrical

systems.  The  turnover  of AS  Connecto  totalled  260,8

million  kroons  (16,6 million euros) in  2002,  and  its

profit  totalled 12,6 million kroons (0,8 million euros).

Company  was established in 2001 and employs 445  people.

The  company  has a subsidiary in Estonia Reveko  Telekom

and in Latvia Connecto Latvia.



Additional information:

AS Connecto

Jaanus Paas

CEO

phone + 372 606 3100





Hille Võrk

Financial Manager

6272 460