YTLE - IMPLEMENTATION OF 2.3 GHZ BROADBAND WIRELESS ACCESS (WiMAX)

We refer to the articles appearing in The Starbiz and the Edge Financial Daily on 28th October 2009 pertaining to the fine imposed on our subsidiary, Y-Max Networks Sdn Bhd (“YMN”) by the Malaysian Communications and Multimedia Commission (“MCMC”) in relation to the roll out of its WiMAX network. We confirm that YMN has received a letter from MCMC informing YMN of its decision to require YMN to make payment of a sum of RM1.9 million.

YMN was awarded the right to the 2.3 GHz spectrum in March 2007. Under the terms of the award, YMN was required to submit a business plan to MCMC with a roll out programme to achieve 25% population coverage by 31 March 2009. Subsequently, YMN changed its business plan and decided to build a nationwide network instead of undertaking a piecemeal roll out. Under its revised business plan, YMN will exceed the targeted coverage prescribed by MCMC by next year. The revised business plan has been submitted to MCMC for approval.

An appeal has accordingly been made to MCMC to reconsider its decision in light of the revised business plan submitted by YMN. YMN is awaiting the response from MCMC to its appeal.