Press Releases

Budapest, May 21, 2008 08:30

On May 19, 2008, White&Case LLP, counsel to the Audit Committee of Magyar Telekom Nyrt. (“the Company”), provided the Company with a “Status Report on the Macedonian Phase of the Independent Investigation.”

In the Status Report, White&Case stated that the “Status Report is a summary of the status of an ongoing inquiry,” is “neither final nor comprehensive,” and “does not address all the contracts under investigation.” Nevertheless, in the Status Report, White&Case stated, among other things, that “there is affirmative evidence of illegitimacy in the formation and/or performance” of six contracts for advisory, marketing, acquisition due-diligence and/or lobbying services in Macedonia, entered into in 2004-06 between the Company and/or various of its affiliates on the one hand, and a Cyprus-based consulting company and/or its affiliates on the other hand, under which the Company and/or its affiliates paid a total of over EUR 6.7M.

As previously disclosed, the Company has taken remedial steps to address issues previously identified by the independent investigation, including steps designed to revise and enhance the Company’s internal controls. The Company is considering whether and to what extent the recent Status Report warrants additional remedial actions. The independent investigation is continuing. The Company cannot predict when the internal investigation will be concluded, what the final outcome of the investigation may be, or the impact, if any, the investigation may have on the Company’s financial statements or results of operations.