TM INTERNATIONAL BERHAD (“TMI”)

(I) PROPOSED SUBSCRIPTION BY TMI MAURITIUS LTD (“TMI MAURITIUS”), A WHOLLY-OWNED SUBSIDIARY OF TMI, OF 464,734,670 NEW ORDINARY SHARES OF INDIAN RUPEE (“RS.”) 10 EACH IN IDEA CELLULAR LIMITED (“IDEA”), REPRESENTING APPROXIMATELY 14.99% OF THE ENLARGED ISSUED SHARE CAPITAL OF IDEA (“PROPOSED SUBSCRIPTION”);

(II) PROPOSED MANDATORY GENERAL OFFER BY IDEA TOGETHER WITH TMI, TMI MAURITIUS, TMI INDIA LTD AND GREEN ACRES AGRO SERVICES PRIVATE LIMITED AS PERSONS ACTING IN CONCERT (“PACS”) WITH IDEA, FOR THE REMAINING 137,985,050 ORDINARY SHARES OF RS.10 EACH IN SPICE COMMUNICATIONS LIMITED (“SPICE”), NOT HELD BY IDEA AND THE PACS (“PROPOSED OFFER”); AND

(III) PROPOSED MERGER OF SPICE AND IDEA (“PROPOSED MERGER”)

(COLLECTIVELY REFERRED TO AS THE “PROPOSALS”)

(Rs. amounts in this announcement have been translated to RM based on the prevailing exchange rate of Rs.1:RM0.0759 as at 24 June 2008)

1. INTRODUCTION

On behalf of TMI’s Board of Directors, CIMB Investment Bank Berhad (“CIMB”) is pleased to announce that TMI intends to expand its presence in India via:

(i) subscription by TMI Mauritius, a wholly-owned subsidiary of TMI, of 464,734,670 new ordinary shares of Rs.10 each in Idea (“Idea Shares”), representing approximately 14.99% of the enlarged issued and paid-up share capital of Idea, for a cash consideration of Rs.156.96 (approximately RM11.91) per Idea Share, or a total cash consideration of Rs.72,944.8 million (approximately RM5,536.5 million) (“Proposed Subscription”);

(ii) mandatory general offer under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (“SEBI Takeover Regulations”) by Idea, together with TMI, TMI Mauritius, TMI India Ltd (“TMI India”) and Green Acres Agro Services Private Limited (“GAASPL”) as the PACs, to acquire the remaining 137,985,050 ordinary shares of Rs.10 each in Spice (“Spice Shares”) not held by Idea and the PACs upon completion of the Proposed MCorp-Spice Acquisition described below (“Proposed Offer”); and

(iii) merging Spice into Idea in accordance with a scheme of arrangement under Sections 391 to 394 of the Companies Act, 1956, as amended from time to time, of India (“Indian Companies Act”) (“Proposed Merger”).

On 25 June 2008, Idea and MCorpGlobal Communications Private Limited (“MCPL”) had entered into a share purchase agreement (“MCPL SPA”) for Idea to acquire 281,489,350 Spice Shares, representing the entire 40.8% of the total issued share capital in Spice held by MCPL, together with a non-compete premium, for a total cash consideration of Rs.27,198.9 million (approximately RM2,064.4 million), or approximately Rs.96.63 (approximately RM7.33) per Spice Share (“Proposed MCorp-Spice Acquisition”).

Upon completion of the Proposals, TMI will cease to have any equity interest in Spice, and will have an equity interest of approximately 19% in the merged Idea (on a fully diluted basis). In addition, TMI and its subsidiaries (“TMI Group”) will have a call option on the Spice Shares (to be converted to Idea Shares under the Proposed Merger) acquired by GAASPL under the Proposed Offer, to further increase TMI Group’s stake in Idea.

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2. DETAILS OF THE PROPOSALS

2.1 Proposed Subscription

Idea, TMI and TMI Mauritius (referred to as the “Subscriber”) are collectively referred to as the “Parties” in Section 2.1.

2.1.1 On 25 June 2008, TMI and TMI Mauritius entered into a share subscription agreement with Idea (“Share Subscription Agreement”). Under the Share Subscription Agreement, the Subscriber will subscribe for 464,734,670 new Idea Shares (“Subscription Shares”), representing approximately 14.99% of the enlarged issued and paid-up share capital of Idea, at a cash subscription price of Rs.156.96 (approximately RM11.91) per Idea Share, or a total cash consideration of Rs.72,944.8 million (approximately RM5,536.5 million).

2.1.2 The subscription price for the Proposed Subscription was arrived at on a willing buyer-willing seller basis after taking into consideration the following:

(i) Idea’s 5-day volume weighted average market price (“VWAP”) up to and including 24 June 2008 of Rs.105.66 (approximately RM8.02) per Idea Share;

(ii) Idea’s 3-month VWAP up to and including 24 June 2008 of Rs.105.91 (approximately RM8.04) per Idea Share;

(iii) Idea’s earnings before interest, taxation, depreciation and amortisation (“EBITDA”) of Rs.22,692.6 million (approximately RM1,722.4 million) and profit after taxation and minority interests (“PATAMI”) of Rs.10,423.1 million (approximately RM791.1 million) based on Idea’s audited consolidated financial statements for the financial year ended 31 March 2008; and

(iv) TMI’s assessment of the historical and future performance of Idea.

2.1.3 The TMI Group will fund the subscription consideration through bank borrowings and/or internally generated funds.

2.1.4 The other salient terms of the Share Subscription Agreement are as follows:

(i) subject to the TMI Group holding at least 10% of the issued share capital of Idea, TMI will have the right to nominate and/or replace 1 member to the Board of Directors of Idea (“Nominee Director”) and nominate and/or replace the Nominee Director as a member of the audit committee of Idea;

(ii) subject to the TMI Group holding at least 10% of the issued share capital of Idea, if Idea intends to issue and allot Idea Shares or any other securities convertible into Idea Shares or any securities giving the right to a call for the issue of Idea Shares (“Relevant Securities”) other than:

(a) Idea Shares issued on an event of default under the loan term financing facilities entered into by Idea on 8 August 2006 and 12 October 2007 (“Long Term Facilities”); or

(b) Idea Shares issued on the exercise of options under Idea’s employee stock option scheme 2006 (“Idea ESOS”); or

(c) Relevant Securities being offered to all shareholders of Idea in proportion to their percentage holding of Idea Shares,

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Idea will, subject to compliance with applicable laws, offer to TMI or its nominee the option to subscribe for the Relevant Securities on the same terms and conditions in such manner so as to maintain the Base Shareholding Level on a fully diluted basis (“Pro-Rata Top Up”).

The Base Shareholding Level is the maximum percentage shareholding of TMI Group in Idea as mutually agreed by TMI and Idea provided that this shall be 14.99% upon completion of the Proposed Subscription (“Base Shareholding Level”).

If TMI fails to exercise its rights to Pro-Rata Top Up and as a result, TMI Group’s shareholding in Idea is diluted below the Base Shareholding Level, TMI Group’s percentage shareholding in Idea shall be deemed to remain at the level immediately before such issuance of Relevant Securities for a period of 12 months. If TMI Group’s percentage shareholding in Idea has not increased to the Base Shareholding Level within the 12 month period after such dilution, the Base Shareholding Level shall be adjusted downwards to the percentage holding of Idea Shares then held by the TMI Group and its affiliates (“TMI Affiliates”). If the TMI Affiliates sell any Idea Shares to any person other than a TMI Affiliate, the Base Shareholding Level shall be reset to the TMI Affiliates’ percentage holding of Idea Shares immediately following such sale; The TMI Group’s right to Pro-Rata Top Up will not apply in the event of any dilution taking place as a result of a merger of any company with Idea, however TMI Group shall be entitled to make secondary purchases of shares not exceeding the Base Shareholding Level.

(iii) where the Relevant Securities are intended to be allotted to non-Indian residents for the purposes of applicable Indian laws and regulations which govern the maximum non-Indian direct and indirect shareholdings in an Indian telecommunications services company from time to time (“FDI Limits”), Idea shall ensure that the size of the offering to non-Indian residents is such that TMI will be able to exercise the Pro-Rata Top Up without breaching the FDI Limits;

(iv) if TMI Group’s shareholding in Idea falls below 10% of the issued share capital of Idea as a result of a breach by Idea of its obligations under the anti-dilution clauses (described in (ii) and (iii) above) or as a result of any issue of Relevant Securities arising from an event of default under the Long Term Facilities or from the exercise of options granted under the Idea ESOS, TMI shall retain its rights for, amongst others, (i), (ii) and (iii) above;

(v) the Subscriber agrees and covenants that it shall not transfer or assign (or purport to do such actions over) the Subscription Shares for 2 years commencing from the date of allotment of the Subscription Shares to the Subscriber;

(vi) subject to the anti-dilution clauses described in (ii) and (iii) above, TMI acknowledges and agrees that neither it nor any of its affiliates will purchase any Idea Shares if such purchase would result in TMI Group’s shareholding exceeding the Base Shareholding Level, without Idea’s prior written consent;

(vii) the issue and allotment of the Subscription Shares and the payment of the Subscription Price is conditional on, amongst others, the following conditions precedent (“Conditions Precedent”):

(a) approval of TMI’s shareholders;

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(b) approval of Idea’s shareholders for the Proposed Subscription;

(c) in-principle approval from the Bombay Stock Exchange Limited and National Stock Exchange of India Limited (collectively, “Indian Stock Exchanges”) for the listing of the Subscription Shares;

(d) approval of Bank Negara Malaysia in relation to the payment of the Subscription Price; and

(e) delivery to TMI by Idea of a letter pursuant to which P5 Asia Investments (Mauritius) Limited, ABNL and Birla TMT Holdings Private Limited waive any rights of pre-emption they may have in respect of the issue of the Subscription Shares;

(viii) if the Conditions Precedent have not been satisfied or waived by all Parties in writing on or before the expiry of the resolution to be proposed to Idea’s shareholders for their approval of the Proposed Subscription pursuant to clause 13.4.1 of the Securities and Exchange Board of India (Disclosure and Investor Protection), 2000, the Share Subscription Agreement shall, unless otherwise agreed by the Parties in writing, be terminated with immediate effect and none of the Parties shall have any further rights or obligations under the Share Subscription Agreement;

(ix) if the Share Subscription Agreement terminates as a result of the non-fulfilment of (a) or (d) of the Conditions Precedent, Idea may, within 30 days of such termination, serve notice (“Idea Put Option Notice”) on TMI requiring TMI or cause a party designated by TMI to purchase all Spice Shares held by Idea (“Spice Option Shares”) at a price of Rs.77.30 (approximately RM5.87) per Spice Share (“Idea Put Option Price”). TMI will, as soon as reasonably practicable after the date of the Idea Put Option Notice, purchase the Spice Option Shares at the Idea Put Option Price and reimburse a sum equal to Rs.5,440.0 million (approximately RM412.9 million) being the consideration paid by Idea under the Non-Compete Agreement entered into on 25 June 2008 between Idea and MCPL; and

(x) any termination of the Share Subscription Agreement pursuant to the

termination clauses shall be without prejudice to any accrued obligations and any right of action or remedy that may have accrued to any Party in respect of breaches of the terms of the Share Subscription Agreement.

2.1.5 The new Idea Shares to be issued under the Proposed Subscription shall, upon allotment and issuance, rank equally in all respects with the existing Idea Shares and the Subscriber shall be entitled to the identical rights and privileges to those of the holders of existing Idea Shares including, without limitation, the receipt of dividends, voting powers and distribution of assets in the event of voluntary or involuntary liquidation, dissolution or winding up of Idea.

2.1.6 Other than the subscription consideration, TMI will not be assuming any liability (including contingent liabilities and guarantees) under the Proposed Subscription.

2.1.7 As Idea is already operating in 11 circles with licenses to operate in the other remaining circles, TMI does not need to incur any additional financial commitment to put Idea’s business on-stream.

2.1.8 It is TMI’s intention to hold the Idea Shares as a long term investment.

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2.2 Proposed Offer and Proposed Merger

2.2.1 On 25 June 2008, TMI, TMI Mauritius, TMI India, Spice, Idea, GAASPL and ABNL (collectively referred to as the “Parties” in Section 2.2) entered into the Merger Cooperation Agreement to, amongst others, pursue a merger between Spice and Idea and set out the obligations of the respective parties for the Proposed Offer. The Proposed Merger will be governed by the Merger Cooperation Agreement.

Idea and the PACs will jointly carry out a mandatory general offer to acquire 137,985,050 remaining Spice Shares not held by Idea and the PACs, at a cash offer price of Rs.77.30 (approximately Rs.5.87) per Spice Share on the business day following the date of the Merger Cooperation Agreement but by no later than 4 business days thereafter, and otherwise in compliance with the SEBI Takeover Regulations. The acquisition of shares by the TMI Group, if any, in the Proposed Offer is subject to, amongst others, the approval of the Reserve Bank of India.

TMI, TMI India and TMI Mauritius are referred to as the “TMI Parties” in Section 2.2.

2.2.2 The Proposed Merger will involve Spice’s shareholders receiving 49 Idea Shares for every 100 Spice Shares held (“Swap Ratio”).

2.2.3 Upon completion of the Proposed Merger, TMI India will receive such number of Idea Shares as consideration for its holding of Spice Shares upon completion of the Proposed Offer based on the Swap Ratio. The number of Spice Shares held by TMI India will depend on the outcome of the Proposed Offer.

Assuming full acceptance under the Proposed Offer, TMI Group will exchange 338,063,250 Spice Shares for 165,650,993 Idea Shares under the Proposed Merger. This will increase TMI’s equity interest in Idea from 14.9% upon completion of the Proposed Subscription to 19.0% upon completion of the Proposed Merger (on a fully diluted basis).

2.2.4 The Swap Ratio was arrived at on a willing buyer-willing seller basis after taking into consideration the following:

(i) Idea’s and Spice’s 5-day VWAP up to and including 24 June 2008 of Rs.105.66 per Idea Share and Rs.61.63 per Spice Share (approximately RM8.02 and RM4.68 per share respectively);

(ii) Idea’s and Spice’s 3-month VWAP up to and including 24 June 2008 of Rs.105.91 per Idea Share and Rs.51.12 per Spice Share (approximately RM8.04 and RM3.88 per share respectively);

(iii) Idea’s EBITDA of Rs.22,692.6 million (approximately RM1,722.4 million) and PATAMI of Rs.10,423.1 million (approximately RM791.1 million) based on Idea’s audited consolidated financial statements for the financial year ended 31 March 2008;

(iv) Spice’s EBITDA of Rs.7,396.2 million (approximately RM561.4 million) and PATAMI of Rs.3,801.3 million (approximately RM288.5 million) based on Spice’s audited consolidated financial statements for the financial year ended 31 December 2007;

(v) Idea’s and TMI’s assessment of historical and future performance of Spice and Idea respectively; and

(vi) valuation reports prepared by 2 independent valuers who are each appointed by the respective Boards of Directors of Idea and Spice.

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2.2.5 Other than the swap ratio consideration under the Proposed Merger, the TMI Group will not be assuming any liability (including contingent liabilities and guarantees) under the Proposed Merger.

2.2.6 The new Idea Shares to be issued under the Proposed Merger shall, upon allotment and issuance, rank equally in all respects with the existing Idea Shares except that they shall not entitle the holders to any dividend, right, allotment and/or other distributions in respect of which the entitlement date is before the date of allotment of such new Idea Shares.

2.2.7 The other salient terms of the Merger Cooperation Agreement are as follows:

(i) the Parties shall, commencing from the date of the Merger Cooperation Agreement, cooperate with each other towards achieving the date of completion of all the activities envisaged under the conditions precedent to the scheme of arrangement agreed by Spice and Idea and approved by the Boards of Directors of Spice and Idea prior to filing with the High Courts of Delhi and Gujarat for the Proposed Merger (“Scheme of Arrangement”) as set out in Section 2.2.7(vi) below (“Effective Date”), by no later than 30 September 2009;

(ii) simultaneous with the execution of the Merger Cooperation Agreement, the following actions, amongst others, will be taken:

(a) execution of the MCPL SPA and all the documentation required to be executed simultaneously with the MCPL SPA as contemplated in the MCPL SPA; and

(b) execution of the Share Subscription Agreement;

(iii) as soon as practicable after the date of the Merger Cooperation Agreement but by no later than 4 business days thereof, the TMI Parties, GAASPL and Idea will cooperate with each other so as to enable them to conduct the Proposed Offer in compliance with the provisions of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (“SEBI Takeover Regulations”) and all other applicable laws and will be jointly and severally liable for the performance of their obligations under the SEBI Takeover Regulations and all other applicable laws. Further, upon completion of the Proposed Offer, Idea will procure, amongst others, the release of TMI’s obligations in respect of Spice’s borrowings;

(iv) subject to applicable laws including the FDI Limits, the TMI Group shall seek to acquire as many Spice Shares in the Proposed Offer as possible. Idea and GAASPL shall cooperate with the TMI Group so as to enable the TMI Group to maximise their shareholdings in Spice in the following manner, subject to regulations:

(a) the first 49% of the Spice Shares subject to the Proposed Offer will be purchased and paid for by TMI;

(b) the next 49% of the Spice Shares subject to the Proposed Offer will be purchased and paid for by GAASPL; and

(c) the remainder of the Spice Shares subject to the Proposed Offer will be provided and paid for by Idea;

(v) TMI and Idea will use their best efforts to enter into a business cooperation agreement which will address, amongst others, areas of mutual cooperation and synergistic opportunities;

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(vi) the Scheme of Arrangement shall be conditional on, amongst others, the following conditions precedent:

(a) completion of the Proposed MCPL-Spice Acquisition;

(b) completion of the Proposed Subscription;

(c) completion of the Proposed Offer;

(d) receipt of the approval of the orders of the High Courts of New Delhi and Gujarat; and

(e) filing of the Scheme of Arrangement with the Registrar of Companies of India pursuant to Sections 391 to 394 of the Indian Companies Act;

(vii) TMI and Idea shall enter into a New Spice Shareholders’ Agreement, details of which are set out in Section 2.2.8 below;

(viii) any dealings by TMI of its holding of Idea Shares will be structured such that it does not breach any applicable laws including the guidelines issued by the Department of Telecommunications under the Ministry of Communications and Information Technology of Government of India (“DoT”) from time to time or trigger a mandatory general offer with respect to Idea Shares under the SEBI Takeover Regulations;

(ix) GAASPL grants TMI an option (“GAASPL Call Option”) to purchase some or all of the Spice Shares held by GAASPL at a sum equal to the aggregate of the price per Spice Share paid by GAASPL in the Proposed Offer and other incidental costs. The GAASPL Call Option is exercisable upon the date of completion of the Proposed Offer and expires 2 years from such date;

(x) TMI grants GAASPL an option (“GAASPL Put Option”) to require TMI or its nominee to purchase some or all of the Spice Shares at the sum equal to the aggregate of the price per Spice Share paid by GAASPL in the Proposed Offer and other incidental costs, to the extent that the GAASPL Call Option has not been exercised. The GAASPL Put Option is exercisable upon 9 months of the date of completion of the Proposed Offer and expires 3 years from such date;

(xi) TMI grants ABNL a call option (“ABNL Call Option”) to purchase all or part of such number of Idea Shares held by the TMI Parties (“ Idea Option Shares”) in excess of the mandatory general offer percentage threshold prescribed in Regulation 10 (or its replacement or supplemental provision) of the SEBI Takeover Regulations (“SEBI Threshold”);

(xii) if TMI Group wishes to sell any of the Idea Shares and hold such number of Idea Shares in excess of the SEBI Threshold, TMI shall notify ABNL of its intention to sell such number of Idea Option Shares and ABNL, within 35 days of receipt of such notice, has the right to exercise the ABNL Call Option and purchase the Idea Option Shares at the fair market value;

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(xiii) any rights in respect of Spice Shares are granted under the Merger Cooperation Agreement shall survive in respect of any shares which are referable to such Spice Shares and are issued pursuant to any reorganisation, merger or amalgamation of Spice with any other entity;

(xiv) all the Parties expressly waive any and all the surviving terms contained

in any and all other existing and proposed agreements, arrangements, understanding and assurances, including but not limited to, amongst others, non-competition and exclusivity, except the confidentiality provisions, and agree that no Party will be bound by any of such terms; and

(xv) the Base Shareholding Level (as defined in the Share Subscription Agreement as set out in Section 2.1.4 (ii)) will be adjusted upwards following the Effective Date, following the exercise of the options under the GAASPL Call Option, GAASPL Put Option and ABNL Call Option and following the purchase of any Idea Shares, subject to the Base Shareholding not exceeding 20.11%.

2.2.8 New Shareholders’ Agreement between TMI and Idea with respect to Spice (“New Spice Shareholders’ Agreement”)

TMI and Idea acknowledge and agree that the New Spice Shareholders’ Agreement will contain minority protections which are substantially similar to those in favour of the TMI Parties in the existing shareholders’ agreement dated 10 March 2006 among TMI, Telekom Malaysia Berhad, MCPL, Spice and certain other parties, and will include, amongst others, the following provisions:

(a) restrictions on any TMI Party, GAASPL and Idea disposing of their Spice Shares to any third party (except in exercise of the GAASPL Call Option or as set out in the Share Subscription Agreement) until the earlier of the Effective Date and 30 September 2009;

(b) acknowledge that Idea will manage the day to day operations of Spice, subject to applicable laws and regulations and the veto rights of the TMI Parties in the New Spice Shareholders’ Agreement; and

(c) the right of Idea to appoint 2 members and TMI to appoint 2 members of the Board of Directors of Spice, and the right of each of TMI and Idea to propose 1 member of the Board of Directors of Spice as an independent member.

2.2.9 TMI’s equity interest in Spice was acquired through its acquisition of TMI India on 10 May 2006 at the original cost of investment of USD178.8 million.

2.2.10 Information on TMI India

TMI India was incorporated in Mauritius under the laws of Mauritius on 3 January 1996 as a private limited company. TMI India’s principal activity is investment holding. To date, TMI India’s authorised share capital is USD100,000,010, comprising 100,000,010 of USD1.00 each (“TMI India Shares”) while its issued and paid-up share capital is USD72,713,919, comprising 72,713,919 TMI India Shares.

TMI India is an indirect wholly-owned subsidiary of TMI via TMI Mauritius. The current directors of TMI India are as follows:

(i) Tan Sri Dato’ Ir Muhammad Radzi bin Haji Mansor;(ii) Dato’ Yusof Annuar bin Yaacob;(iii) Jean Maurice Richard Arlove; and(iv) Nousrath Begum Bhugeloo.

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2.2.11 Information on TMI Mauritius

TMI Mauritius was incorporated in Mauritius under the laws of Mauritius on 3 June 1997 as a private limited company under its present name. TMI Mauritius’ principal activity is investment holding. To date, TMI Mauritius’ authorised share capital is USD1,000,000, comprising 1,000,000 of USD1.00 each (“TMI Mauritius Shares”) while its issued and paid-up share capital is USD10,000, comprising 10,000 TMI Mauritius Shares.

TMI Mauritius is a wholly-owned subsidiary of TMI. The current directors of TMI Mauritius are as follows:

(i) Tan Sri Dato’ Ir Muhammad Radzi bin Haji Mansor;(ii) Dato’ Yusof Annuar bin Yaacob;(iii) Jean Maurice Richard Arlove;(iv) Rajensingh Ballah; and(v) Nousrath Begum Bhugeloo.

2.2.12 It is expected that the new Idea Shares to be held by TMI Group arising from the Proposed Subscription and Proposed Merger will be listed on the Indian Stock Exchanges.

3. INFORMATION ON IDEA AND SPICE

3.1 Idea

Idea was incorporated as Birla Communications Limited on 14 March 1995 as a private limited company under the laws of India. On 30 May 1996, its name was changed to Birla AT&T Communications Limited. Following the execution of a joint venture agreement dated 5 December 1995 between AT&T Corporation and Grasim Industries Limited, the Aditya Birla Group held 51% of Idea’s equity share capital and the AWS Group held 49% of Idea’s equity share capital. With effect from 1 January 2001 following its merger with Tata Cellular Limited, the joint venture agreement between AT&T Corporation and Grasim Industries Limited dated 5 December 1995 was replaced by a shareholders agreement dated 15 December 2000 entered into between Grasim Industries Limited on behalf of the Aditya Birla Group, Tata Industries Limited on behalf of the TATA Group and AT&T Wireless Services Inc. on behalf of the AWS Group following which Idea’s name was changed to Birla Tata AT&T Limited on 6 November 2001.

Consequent to the introduction of the “Idea” brand, Idea’s name was changed to its present name on 1 May 2002. The AWS Group exited from Idea on 28 September 2005 by selling 371,780,740 equity shares of Idea, which constituted 50% of the holding of AT&T Cellular Private Limited in Idea’s equity share capital to ABNL and by transferring the remaining 371,780,750 equity shares to Tata Industries Limited. The TATA Group ceased to be a shareholder of Idea on 20 June 2006 when Tata Industries Limited and Apex Investments (Mauritius) Holding Private Limited (formerly known as AT&T Cellular Private Limited) sold all their shares in Idea to the Aditya Birla Group. On 26 October 2006, P5 Asia Investments (Mauritius) Limited acquired 14.60% of Idea’s equity share capital.

Idea has not declared or paid any cash dividend on its equity shares since inception. Idea proposes to re-invest any future allowable surpluses towards expanding and upgrading its mobile network.

(Source: Idea’s Prospectus dated 21 February 2007)

Idea was listed on the Indian Stock Exchanges on 9 March 2007.

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Idea is currently the 6th largest mobile telecommunications company in India, in terms of number of subscribers. As at 31 March 2008, Idea had 24 million subscribers, representing 9.4% market share in India. It has existing operations in 11 circles and holds licenses to operate in the remaining circles. It is rolling out operations in 4 circles, namely Mumbai, Bihar, Tamil Nadu and Chennai.

Idea’s authorised and issued and paid-up share capital as at 31 March 2008 are as follows:

Type No. of shares Par value TotalRs. Rs. million

Authorised:Ordinary shares 3,775,000,000 10 37,750.0Redeemable cumulative non-convertible preference shares

500 10,000,000 5,000.0

Issued and fully paid-up: Ordinary shares 2,635,360,539 10 26,353.6

Idea’s consolidated net assets and profit after taxation are Rs.21,791.5 million and Rs.10,423.1 million respectively, based on its audited consolidated financial statements of Idea for the financial year ended 31 March 2008.

Table 1 sets out a summary of the audited financial information of Idea for the past 5 years ended 31 March 2004 to 2008.

3.2 Spice

Spice was incorporated as Modicom Network Private Limited on 28 March 1995 as a private limited company under the laws of India. Spice subsequently became a deemed public company under Section 43(1A) of the Indian Companies Act with effect from 1 April 1999 and its name was changed to Modicom Network Limited. Spice assumed its present name via a fresh Certificate of Incorporation dated 3 December 1999. With the addition of the word ‘Private’ in Spice’s name under Section 43(2A) of the Companies Amendment Act, 2000 of India, Spice’s name was changed to Spice Communications Private Limited with effect from 28 October 2003. On 28 December 2006, Spice was converted into a public limited company and assumed its present name.

Spice’s principal activity is as a licensed mobile cellular telecommunications service provider in the state of Punjab and Karnataka in India. Spice has also been awarded licenses for the states of Maharashtra, Andhra Pradesh, Delhi and Haryana although allocations for spectrum have not yet been granted.

Spice’s current authorised capital is Rs.7,500,010,000, comprising 750,001,000 ordinary shares of Rs.10 each, and its issued and paid-up share capital is Rs.6,899,250,000, of which 689,925,000 ordinary shares of Rs.10 each are fully subscribed and paid-up.

Spice was listed on the Bombay Stock Exchange on 19 July 2007 and on the National Stock Exchange of India Limited on 16 June 2008.

Spice’s net assets and profit after taxation are USD8,579.3 million and Rs.3,801.3 million respectively, based on its audited financial statements for the financial year ended 31 December 2007.

Table 2 sets out a summary of the audited financial statements of Spice for the past 4 years ended 30 June 2003 to 2006, the unaudited financial information for the financial year ended 31 December 2006, the audited financial information for the financial year ended 31 December 2007 and the unaudited financial information for the 3-month financial period ended 31 March 2008.

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4. CONDITIONALITY

The Proposed Merger is conditional on the Proposed Subscription and the Proposed Offer.

Save as disclosed above, there is no other conditionality amongst the Proposals.

5. RATIONALE FOR THE PROPOSALS

The Proposals will result in TMI becoming the 2nd largest shareholder in Idea, which will become the 5th largest mobile telecommunication company in India, in terms of number of subscribers, after Bharti Airtel Limited (“Bharti Airtel”), Bharat Sanchar Nigam Limited (“BSNL”), Reliance Communications Limited (“Reliance”) and Vodafone Essar Ltd (“Vodafone Essar”).

The key rationales of the Proposals are as follows:

(i) Participating in the growth potential of India

The Indian market is at a rapid growth phase with approximately 7 to 8 million net additions per month. It has outperformed regional peers with 56% year-on-year growth recorded in 2007.

With the current low penetration level (one of the lowest among peer countries) and improving economics, future growth is expected to be strong with approximately 200 to 300 million net additional subscribers expected over the next 3 years.

Headroom for growth in India from 2007 to 2012 is equivalent to the total expected growth of the current TMI footprint and practically the whole of TMI’s target region (excluding India).

It is therefore essential for TMI to widen its reach in India during this period of high growth.

(ii) Accelerate participation in the growth through consolidation/inorganic means

As a regional telecommunication investor, it is essential for TMI to capitalise on the current high growth phase, especially as the headroom for growth is in the next 3 to 5 years. By 2012, it is expected that the penetration would reach the 50% to 60% level and beyond 2012 the country is expected to record slower growth. As such, the ‘India opportunity’ prevails now and any delay would reduce the ability to capitalise on the rapid growth. TMI’s current operations in Spice have performed well. However, it remains at a regional scale with only 2 circles in operation.

Although Spice has been assigned licenses for 4 new circles, it would take approximately 1 to 2 years to rollout (following the spectrum allotment) and further 1 to 3 years for a pan-Indian rollout. As such, the time lag could result in reduced ability to benefit from the significant opportunity and growth potential in the market in the next 3 to 5 years. At the same time, bigger players with better economies of scale are entering into Spice’s existing circles and strengthening their operations in other circles making the competition intense. As such, consolidation is imminent where TMI intends to lead market consolidation in India.

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(iii) Idea and Spice are complementary

The combination of Spice and Idea has no operational overlaps in its circles. Together, it would have a presence in 13 circles covering approximately 70% of the Indian population. Further the combined entity would become the 5 th largest operator in India (by subscribers, as at 31 March 2008) with 28.2 million subscribers compared to Idea stand alone of 6th position and Spice stand alone of 8th position. Idea has also secured licenses for all the remaining circles and national rollout is in the pipeline. The infusion of Rs.72,944.8 million (approximately RM5,536.5 million) by TMI is primarily aimed at providing funding support to national rollout aspiration and become a pan-Indian operator. The investment also brings a strong partnership to TMI Group with Idea’s strong financial performances. It also enables collaboration with the reputed ABNL Group.

Over the last few years, Idea has been performing well, recording 71% year-on-year growth in subscribers in 2007, outperforming the industry growth of 58% together with revenue compounded annual growth rate (“CAGR”) of 50% and EBITDA CAGR of 44%.

(iv) Merger of Idea and Spice brings additional benefits to both Idea and TMI

The investment leverages TMI’s regional experience especially in the more matured markets including expertise in 3G businesses and rollout experiences as India moves into the next technology wave. For TMI, the transaction will provide additional exposure to new emerging business models such as pay-as-you-grow, managed services, active/passive infrastructure sharing and hosted Value Added Services. Together, TMI and Idea would form a business cooperation forum to help facilitate synergies and share knowledge as well as best practices between the two groups of companies.

(v) The Proposals is expected to enhance the future earnings of TMI Group

The combined entity is expected to become earnings accretive for TMI (post financing costs) in the first full year from completion of the Proposed Merger. On the contrary, if TMI were to embark on the alternative strategy of greenfield rollout in Spice, the substantial capital infusion would be earnings dilutive for the next 4 to 5 years.

6. POLICIES ON FOREIGN INVESTMENT AND REPATRIATION OF PROFITS

Foreign investment policies in India

Foreign investment in India is governed by the Foreign Direct Investment (“FDI”) policy announced by the Government of India and the provisions of the Foreign Exchange Management Act, 1999 (“FEMA”). The telecommunications industry in India is governed by the DoT and Foreign Investment Promotion Board of India (“FIPB”).

The FIPB has imposed a limit on foreign investment in the telecommunications sector to 74%. Both the direct and indirect foreign investment in the licensee company shall be counted for the purpose of FDI ceiling.

Repatriation of profits in India

The Government of India permits repatriation of profits only through authorised dealers appointed in accordance with the provisions of FEMA. In respect of remittance of sale proceeds from securities, the remittance of sale proceeds of a security (net of applicable taxes) can be remitted to the seller of shares resident outside India, provided that the security has been held on repatriation basis, the sale of security has been made in accordance with the prescribed FDI guidelines, and that a tax clearance certificate has been produced.

There is no withholding tax on dividend income. Profits from investments in Indian companies can be repatriated. Dividends are freely repatriable after payment of distribution dividend tax by the Indian company.

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The Mauritius-Indian Double Taxation Avoidance Agreement provides for companies incorporated in Mauritius to be considered as ‘residents’ of Mauritius for taxation purposes and claim tax treaty benefits subject to the issuance and annual renewal of a tax residency certificate by the Mauritius Financial Services Commission to the Mauritian-incorporated company. Repatriation of profits in Mauritius

Subject to applicable withholding taxes, profits from a Mauritius company can be repatriated without any restrictions. There is no withholding tax in Mauritius for payments made by Global Business License companies (being companies which are foreign-owned and are governed and regulated by the Financial Services Commission of Mauritius) to non residents not carrying out any business in Mauritius. In addition, all profits accruing to a company holding a Category 2 Global Business License are fully repatriable without payment of any withholding tax.

7. PROSPECTS

7.1 Prospects relating to the Indian mobile telecommunications industry

Throughout 2007, the Indian mobile market continued its growth momentum, achieving net additions of over 84 million subscribers, which amounted to a total mobile subscriber base of 233.6 million as of 31 December 2007. Mobile subscriber base in India is expected to grow at a CAGR of more than 25% from 2007 to 2010. While subscriber growth would gradually slow down as the market saturates, a combination of factors such as acceleration of fixed-to-mobile substitution, expansion of rural market coverage, increasing competition resulting in the introduction of innovative cellular service packages and the falling costs of entry level handsets is likely to stimulate future growth.

Keeping pace with subscriber growth, mobile revenue in India has been growing at a very rapid pace, reaching USD17,594 million as of 31 December 2007, against a subscriber base of 233.6 million. The Indian mobile market has huge growth potential given its relatively low mobile subscriber penetration and wireline infrastructure. Increasing competitive pressure to drive down tariffs and declining entry-level handset costs are likely to fuel demand from first time users. As operators are penetrating lower segments of the market, prepaid subscribers are expected to contribute a larger share of the growth. This is likely to affect mobile average revenue per user (“ARPU”) adversely in the near to mid-term.

Though the Indian mobile market is highly competitive, it is dominated by 4 pan-Indian players, namely Bharti Airtel, BSNL, Reliance and Vodafone Essar. As of 31 December 2007, these 4 players accounted for 74.0% of total mobile subscribers in the country. Public sector operators (BSNL and MTNL) contribute 17.1% of subscribers in the GSM segment while the others, which are privately held mobile operators, control 82.9%.

As the Indian mobile market is dominated by a price sensitive prepaid segment, mobile operators compete fiercely on price plans and typically adopt similar cuts in tariffs when offered by a competitor. Other key basis of competition includes quality and coverage of network, brand identity, and the breadth of value-added services offered.

(Sources: Mobile Telecommunications Market in India (Frost & Sullivan, April 2008); Telecom Regulatory Authority of India; DoT)

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7.2 Prospects relating to the Indian economy

The economy continued to show high growth momentum during 2006-07 and 2007-08. As per the Quick estimates of National Income for 2006-07 released by the Central Statistical Organisation (“CSO”), the Gross Domestic Product (“GDP”) at factor cost (at constant 1999-2000 prices) grew at 9.6% in 2006-07 compared to 9.4% in 2005-06 and 7.5% in 2004-05. The agriculture and allied industry and services sectors grew by 3.8%, 11.0% and 11.1% respectively during 2006-07. The real growth of 9.6% in GDP during 2006-07 has been achieved mainly due to growth in manufacturing (12.0%), construction (12.0%), trade, hotels and restaurant (8.5%), finance, insurance, real estate and business services (13.9%), and transport, storage and communications (16.6%).

(Source: Annual Report 2007/2008 of the Ministry of Finance, India)

GDP at factor cost (at constant 1999-2000 prices) is projected by the CSO to grow at 8.7% in 2007-08. This represents a deceleration from the unexpectedly high growth of 9.4% and 9.6%, respectively, in the previous two years. With the economy modernising, globalising and growing rapidly, some degree of cyclical fluctuation is to be expected. This was taken into account while setting the Eleventh Five Year Plan (2007-08 to 2011-12) growth target of 9% (both in the approach paper and in the National Development Council approved plan). Given the over 9% growth in the last 2 years of the Tenth Five Year Plan it was argued that the Eleventh Five Year Plan target could be set at 10% to 11% as 9% had already been achieved. Maintaining growth rate at 9% will be a challenge and raising it to two digits will be an even greater challenge.

(Source: Economic Survey 2007-2008 of the Ministry of Finance, India)

7.3 PROSPECTS OF THE MERGED IDEA GROUP

Given the merged Idea Group’s presence over 13 circles, which covers 70% of the population of India, Idea is well-positioned to become a pan-India mobile operator.

Further, the merged Idea is expected to benefit from synergies arising from the Proposals, which is expected to benefit the TMI Group.

8. RISK FACTORS

8.1 Risk factors relating to Idea’s and Spice’s business

As the TMI Group is already involved in the Indian mobile telecommunications business (through Spice), the risk factors described in this section already exist in the TMI Group. A summary of the risks (which may not be exhaustive) relating to Idea’s and Spice’s business is set out below:

(i) Competition faced by Idea and Spice

The mobile telecommunications services market in India is highly competitive. Idea and Spice face intense and significant competition from other operators, some of which are larger, have a pan-India presence and have diversified their services beyond voice services, such as Bharti Airtel, BSNL, Reliance and Vodafone Essar.

Competition has increased following the deregulation in the industry, and is expected to intensify even further with the entry of new foreign and domestic competitors in each circle as licenses are awarded to new entrants. Further, Idea and Spice will face significant competition from the well established operators in the new circles for which they have recently acquired licenses.

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(ii) Rapid technology changes

The mobile telecommunications industry is subject to rapid, ongoing technological changes. Emerging and future technological changes may adversely affect the viability or competitiveness of Idea’s and Spice’s businesses. Furthermore, changing market demand and consumer trends may require Idea and Spice to adopt new technologies that could render their existing technologies less competitive or obsolete.

(iii) Regulations and licenses

The operation of mobile telecommunications business and provision of related services in India are subject to certain approvals, licenses, registrations and permissions granted by the Government of India and regulated by the DoT. Changes in laws, regulations or government policy in India or in relation to the mobile telecommunications industry in India or in relation to the licenses or spectrum allocations held by Idea and/or Spice or their competitors, could adversely affect Idea’s and Spice’s businesses. Any breach of the terms and conditions of the licenses or spectrum allocation by Idea or Spice or failure to comply with the applicable regulations on Idea’s or Spice’s part may result in their being fined or their licenses being cancelled by the Government of India. Any revocation or unfavorable amendment to the terms of the licenses, failure to renew them on comparable terms or failure to obtain spectrum allocation in a timely manner could have a material adverse effect on Idea’s and Spice’s businesses and performance in their existing and new circles.

(iv) High regulatory charges

The telecommunications industry in India faces significant high regulatory charges. The various levies include license fees, Access Deficit Charges (“ADC”), spectrum charges and service taxes. However, there are phased reductions in ADC and subsequent removal of ADC. For example, ADC on domestic calls was eliminated with effect from 1 April 2008. ADC on international calls to India has been halved from April 1 to end of September 2008, after which it will be phased out.

(v) Restrictions on foreign shareholding

The limit on foreign shareholding by the Government of India of 74% of the total issued capital may prevent Idea and Spice from raising further capital outside India through the issuance of equity or convertible debt securities and restricts the ability of non-Indian companies to acquire an interest in Idea and Spice to fund their expansion in other circles. The effective foreign shareholding in Idea and Spice is currently approximately 45% and 66% respectively. Upon completion of the Proposed Subscription, the foreign shareholding in Idea is expected to be approximately 53%.

8.2 Risk factors relating to the Proposals

A summary of the risks (which may not be exhaustive) relating to the Proposals is set out below:

(i) Fluctuations in the exchange rate

A weakening or strengthening of the Indian Rupee may impact the profits of the enlarged Idea Group in Ringgit Malaysia terms which is expected to be equity accounted as part of the earnings of the TMI Group. However, Idea Group’s revenue and costs are in Indian Rupee and therefore provide a natural hedge.

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(ii) Regulations on foreign investment

The investment of the TMI Group will be subject to the foreign investment policies of the government of India. In addition, the ability of TMI to repatriate the profits arising from its investment in India will depend largely on the relevant legislation relating to the repatriation of profits prevailing at the point of repatriation. However, as TMI has invested in India since 2006, TMI will continue to seek professional advice where necessary to minimise such risks.

(iii) Acquisition risk

The TMI Group is expected to recognise additional goodwill arising from the Proposals. TMI may potentially be required to charge any impairment the future relating to the additional goodwill. Any impairment of goodwill will result in a charge to the consolidated earnings of TMI.

9. EFFECTS OF THE PROPOSALS

9.1 Share capital

The Proposals will not have any effect on the issued and paid-up share capital of TMI as the respective consideration for the Proposals will be satisfied in cash or via share swap of Spice Shares for Idea Shares (in respect of the Proposed Merger).

9.2 Earnings

The proforma gain arising from the Proposals is approximately RM180 million, based on the audited financial statements of the TMI Group as at 31 December 2007 and based on the assumptions that the Proposals were completed on 31 December 2007, the Proposed Offer has been fully accepted and TMI Group acquires 9.8% of the equity interest of Spice under the Proposed Offer, and on the closing market share price of Spice as at 24 June 2008 of Rs.55. This, however, is not an indication of the actual gain that TMI would recognise upon completion of the Proposals, which would depend on, amongst others, the acceptance level under the Proposed Offer and the fair value of Spice Shares then. Further, the gain, if any, will only be recognised in the year the Proposals are completed.

Going forward, the effect of the Proposals on TMI’s consolidated earnings for the subsequent years will depend on the future performance of Idea and Spice, funding costs associated with the borrowings taken up by TMI. Nonetheless, the Proposals are expected to be earnings accretive to the TMI Group from 2010 onwards.

9.3 Net assets and gearing

The proforma effect of the Proposals on the consolidated net assets and gearing of the TMI Group based on its latest audited consolidated balance sheet is set out in Table 3.

9.4 Substantial shareholders’ shareholding in TMI

The Proposals will not have any effect on the shareholdings of TMI’s substantial shareholders in TMI.

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10. APPROVALS REQUIRED

The Proposals are subject to the following:

(i) approval of Bank Negara Malaysia for the Proposed Subscription and Proposed Offer;

(ii) approval of TMI’s shareholders for the Proposals;

(iii) approval of Spice’s shareholders for the Proposed Merger;

(iv) approval of Idea’s shareholders for the Proposed Subscription and Proposed Merger;

(v) regulatory approvals in India;

(vi) approval of lenders/creditors, if required; and

(vii) other regulatory authorities, where applicable.

11. DIRECTORS' AND MAJOR SHAREHOLDERS' INTERESTS

None of TMI’s Directors, major shareholders and/or persons connected to TMI’s Directors or major shareholders has any direct or indirect interest in the Proposals.

12. ESTIMATED TIMEFRAME FOR COMPLETION

Barring any unforeseen circumstances, the Proposals are expected to be completed in the second quarter of 2009.

13. ADVISERS

Lazard India Private Limited has been appointed as the financial adviser to TMI for the Proposals.

CIMB has been appointed as the Malaysian Adviser to TMI for the Proposals.

14. DIRECTORS' STATEMENT

The Board of Directors of TMI, having considered all aspects of the Proposals, believes that the terms and conditions of the Proposals are fair and reasonable and are in the best interest of TMI.

15. COMPLIANCE WITH THE SECURITIES COMMISSION’S GUIDELINES ON THE OFFERING OF EQUITY AND EQUITY-LINKED SECURITIES (“SC GUIDELINES”)

TMI is not aware of any departure from the SC Guidelines in respect of the Proposals.

16. DOCUMENTS AVAILABLE FOR INSPECTION

A copy each of the Share Subscription Agreement and Merger Cooperation Agreement are available for inspection at TMI’s registered office at Level 42, North Wing, Menara TM, Jalan Pantai Baharu, 50672 Kuala Lumpur during normal business hours from Monday to Friday (except for public holidays) for a period of 3 months from the date of this announcement.

This announcement is dated 25 June 2008.

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