TELEKOM MALAYSIA WELCOMES NEW MD/CEO, ANNOUNCES BOARD CHANGES AND RESTRUCTURING OF TM TELCO

Kuala Lumpur, 1/7/2004 - Telekom Malaysia is pleased to announce that YBhg. Dato' Abdul Wahid Omar today has assumed his position as the new Managing Director/Chief Executive Officer (MD/CEO) of Telekom Malaysia. This is YBhg. Dato' Abdul Wahid's second stint in Telekom Malaysia as he served the Company as Chief Financial Officer from March 2001 to September 2001 before assuming his duties as MD/CEO of United Engineers (Malaysia) Berhad.

In addition to assuming his duties as MD/CEO of Telekom Malaysia, , YBhg. Dato' Wahid has also been appointed as Deputy Chairman of Celcom (Malaysia) Berhad as well as Director of Telekom Malaysia's listed subsidiary, VADS Berhad.

Board Changes
In line with the new guidelines announced by the Government related to the restructuring of the Board and Management of Government Linked Companies (GLCs), Telekom Malaysia is pleased to announce that YBhg. Dato' Abdul Rahim bin Haji Daud who retired as the Deputy Chief Executive/Executive Director on 30 June 2004, remains on the Board as a Non-Executive Director effective 1 July 2004. The other new directors who have been appointed to the Board effective 1 June 2004 are Encik Azman Mokhtar, the CEO of Khazanah Nasional Berhad and YB. Datuk Nur Jazlan bin Tan Sri Mohamed, a certified chartered accountant and a director of United Malayan Land Berhad.

With the changes to the Board of Telekom Malaysia, the Board Audit Committee now comprises:
- YB Datuk Nur Jazlan bin Tan Sri Mohamed as Chairman (Independent Non-Executive)
- YBhg. Dato' Lim Kheng Guan (Independent Non-Executive)
- YBhg. Dato' Dr Abdul Rahim Haji Daud (Non-Independent Non-Executive)
- Encik Rosli Man (Independent Non-Executive)

As of 1 July 2004, Telekom Malaysia is also delighted to welcome YBhg. Tan Sri Dato' Seri Musa Mohamad, the former Education Minister, as the new Chairman of Universiti Telekom Sdn. Bhd., a wholly-owned subsidiary of Telekom Malaysia that manages Multimedia University (MMU), the country's first private university. YBhg. Tan Sri Dato' Seri Musa brings with him vast experience in the education field having served as a vice chancellor of USM from 1982 to 1995.

Restructuring of TM TelCo
In line with Telekom Malaysia's continuing commitment to enhance its service quality and product delivery to all Malaysians, the Company is pleased to announce that effective 1 July 2004, TM TelCo, its largest Strategic Business Unit, handling all its fixed line services for voice and data will be restructured into separate Wholesale and Retail business units.

This restructuring is to cater for improved operational and streamlined efficiencies for end customers. In essence, TM Wholesale will be responsible for the provisioning of infrastructure access and network capacities to all licensed telecommunication operators while TM Retail will focus on enhanced service and product delivery to end business and residential consumers.

Through this move, Telekom Malaysia will be able to bring greater business focus and streamlined operational efficiencies through the elimination of non-value added and redundant processes in its effort to deliver quality and guaranteed levels of service quality to its business and residential consumer segments. In the long run, through the maximum utilisation of its network capacity, Telekom Malaysia sees this as an opportunity to grow the nation into a regional telecommunications hub in support of its national aspiration towards a digital and knowledge-based economy.

With the restructuring of its major fixed voice and data services division, effective 1 July 2004, Telekom Malaysia would like to assure all its customers that there will not be any disruption to services.

Telekom Malaysia stands committed to play a major role in nation-building by continuing to implement the latest in communication technologies as well as building its customer relationship management for the benefit of all Malaysians through this restructuring effort.