Eesti Telekom     STOCK EXCHANGE ANNOUNCMENT    25.10.2005



COMPETITION BOARD APPROVED PURCHASE OF IT-PROVIDER MICROLINK



Estonian   Competition  Board  gave  approval  to   Elion

Enterprises  AS, a wholly owned subsidiary  of  AS  Eesti

Telekom, to purchase MicroLink AS, the leading Baltic  IT

services   company.  MicroLink  Eesti  AS  will  continue

independently  in  Elion group, MicroLink  operations  in

Latvia  will  be  sold to Lattelekom  SIA  and  MicroLink

operations in Lithuania to Lietuvos Telekomas AB.



According  to  the  decision of the Estonian  Competition

Board  MicroLink  has  to sell its fibre-optical  network

based  on  Ethernet technology and contracts as  well  as

know-how  that  are  related  with  this  network.   This

condition  set  by Competition Board will  not  influence

significantly   transaction  value  for  Elion.   Latvian

Competition  Board  also approved the deal  on  condition

that  Lattelekom will sell MicroLink´s data communication

network in Latvia. Approval of the Lithuanian Competition

Board is also necessary for closing of the deal.



The  aim  of  the acquisition of MicroLink  Eesti  is  to

reinforce  the market position of Elion and MicroLink  in

the  Estonian  IT  market  and  to  offer  customers  the

broadest  selection of IT services and  integrated  IT  &

communications solutions. Elion IT-services business area

will   be  moved  to  MicroLink,  while  MicroLink   data

communications  business will be run by Elion.  MicroLink

will  be  responsible for offering IT  services,  Elion´s

role is to sell IT solutions and integrated solutions  to

SME  sector  as  well  as  to  manage  customer  care  of

corporate clients.



According  to  Tallinn  Stock Exchange  regulations  this

transactions   is   not  considered  as   a   significant

acquisition  and due to that parties have agreed  not  to

disclose  exact  price  of the deal.  The  value  of  the

MicroLink  Eesti  is less than 100 million  kroons  (less

than  6.4  million  Euros)  for Elion.  This  transaction

cannot  be  considered as a transaction  with  a  related

party  as  no member of the Council nor of the Management

Board of Elion Enterprises Ltd. or Eesti Telekom have any

personal interest in the transaction.



MicroLink  (www.microlink.com) is the largest  Baltic  IT

services company whose business interests include: system

integration   and   infrastructure  solutions;   software

development;    ERP   and   business   solutions;    data

communications  and  networking;  central   systems   and

datacentre solutions; systems management and maintenance;

end-user  PC  services and support; full IT  outsourcing.

The  group has 575 employees and is present in all  three

Baltic  countries. MicroLink's 2004/2005  financial  year

net  revenue  was 35.5 million Euros and net  profit  1.3

million  Euros. MicroLink is the only Baltic IT  company,

whose business areas and technology solutions cover  more

than  90%  of  IT  needs  of modern  private  and  public

organizations.



Elion  (www.elion.ee)  is the largest  telecommunications

and  IT  provider  in Estonia. It is owned  by  AS  Eesti

Telekom,  listed at the stock exchanges  of  Tallinn  and

London  (TSE:ETL/LSE:EETD). Elion provides  comprehensive

household  and  business communication  services  –  from

telephone  calls  to integrated business solutions,  from

the  sale  of handsets and computers to the provision  of

broadband, the installation and maintenance of  large  IT

systems.  In Estonia Elion is the market leader in  fixed

network   calls,  in  Internet  subscriptions  and   data

communication solutions, and it has made a powerful entry

into the IT market. In 2004 the consolidated net sales of

the  Elion  Group were 2.679 billion kroons (171  million

Euros),  and the consolidated net profit was 342  million

kroons  (22  million Euros). Currently  the  Elion  Group

employs a staff of 1515.





Ain Parmas

Head of Media Relations of Elion Enterprises Ltd.

+372 6397 236