IDEA Cellular concludes largest acquisition in Indian wireless industry

Company press release, January 16, 2004

New Delhi

IDEA Cellular Limited (IDEA), one of the leading cellular operators in the country, today signed a definitive agreement for the acquisition of 100 per cent stake in Escotel Mobile Communications Limited (EMCL) and Escorts Telecommunications Limited (ETL). This is the largest acquisition in Indian wireless industry. The transaction includes 6 telecom circles and more than 825000 subscribers. In an all cash transaction, IDEA has entered into a share purchase agreement with the sponsors of EMCL and ETL, i.e. Escorts and First Pacific, to buy their 100% equity stake in these companies. The agreement is subject to all statutory approvals and will also require consent of lender groups.

With this transaction IDEA's subscribers base as of 31-Dec-03 will increase from 2.2 million to over 3 million. The IDEA footprint will now cover around 60% of the India's population and over 65% of the potential telecom-market. The newly acquired circles represent an addition to IDEA's existing footprint with all, except Kerala, being contiguous to IDEA's existing operation. The Company will have incumbency advantage in as many as 7 circles which would entitle the Company to an additional 2% reduction in license fees for four years from 1-Apr-04 which has been granted only to the incumbent 1st and 2nd operators in non-metro circles.

Commenting on the deal, Mr. Vikram Mehmi, CEO, IDEA Cellular Ltd., said "IDEA has a successful track record in M&A having itself been formed through a merger of Tata Cellular Limited with Birla AT&T Communications Limited and the subsequent acquisition of RPG Cellcom's MP circle. Now, with the acquisition of Escotel, the company has again demonstrated its ability to consolidate and grow inorganically. The expansion of footprint brings benefits of scale and synergy to both IDEA and Escotel, thus adding huge value to the respective stakeholders."

About IDEA Cellular Ltd.

IDEA is a leading cellular service provider in the country. It is an equal three way joint venture between the Aditya Birla Group, the Tata Group and AT&T Wireless and provides cellular services in the circles of Andhra Pradesh, Delhi, Gujarat, Maharashtra and Madhya Pradesh.

IDEA in its current shape was formed with the merger of Tata Cellular Limited (TCL), cellular service provider in Andhra Pradesh Circle, with Birla AT&T Communications Limited (BACL), cellular service provider for the Gujarat and Maharashtra Circles and subsequent acquisition of BTA Cellcom Limited (BTACL), a cellular service provider for Madhya Pradesh Circle and the award of 4th cellular license for Delhi Metro Circle. IDEA has a cellular subscriber base of 2,241,427 as at the end of 31-Dec-03.

About Escotel

Escotel was promoted by Escorts Limited with 51% equity and First Pacific with 49% equity. EMCL is the incumbent cellular service provider in the telecom circles of Haryana, Uttar Pradesh (West) and Kerala. It has a cellular subscriber base of about 825,845 as at end of 31-Dec-03. Escotel is presently the leading operator in UP(West) and number 2 in Kerala and Haryana. The Company is already cash positive with well run operations in all three circles. ETL is the 4th cellular licensee in the telecom circles of Uttar Pradesh (E), Rajasthan, and Himachal Pradesh.

For more information, please contact:

Kunal Advant/Varun Chopra,

Clea PR, Tel: (011) 26428416-20

Cell: 98915 96000

Kunal Advant

Clea Public Relations

Work: 91-11-26428416-21

Fax: 91-11-26428414

Mobile: 0-9891596000

Email: kunal.advant@cleapr.com