31.07.2006 – 11:19

Telekom Austria AG

euro adhoc: Telekom Austria AG
Mergers - Acquisitions - Takeovers
Telekom Austria Group Withdrew from the Auction for the Serbian Mobile Operator Mobi 63 (Ad-hoc)

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31.07.2006

Vienna, July 31, 2006: The Telekom Austria Group (VSE: TKA, NYSE:
TKA) today announced the withdrawal of its wireless subsidiary
mobilkom austria from the tender for the acquisition of a stake in
the Serbian mobile operator Mobi 63. Based on its thorough evaluation
of both, the Serbian mobile communication market and of the business
prospects of Mobi 63 and due diligence conducted over an extended
period of time, Telekom Austria decided to stop bidding, once the
tender price exceeded the amount that the management believed
justified.

Boris Nemsic, CEO of the Telekom Austria Group and CEO mobilkom
austria said: "As a management team we are fully committed to our
shareholders and our primary goal is to create value in the business.
Mobi 63 was sold at a price that we felt was not value accretive. As
a consequence, we decided to withdraw from the bidding process.
However, East and South-East Europe continues to be the focus of our
expansion strategy and we expect to see other opportunities in this
growth region over the coming years."

Stefano Colombo, Chief Financial Officer of the Telekom Austria Group
added: "Following today’s decision and once the tenders underway in
Slovakia and Bosnia Herzegovina are finalized, we will review our
cash use policy and explore new possibilities to return additional
capital to our shareholders."

end of announcement                               euro adhoc 31.07.2006 11:10:04

Further inquiry note:

Mag. Peter E. Zydek
Head of Investor Relations Telekom Austria
Tel.: +43 (0) 59059 1-19001
mailto:peter.zydek@telekom.at

Elisabeth Mattes
Spokeswoman Telekom Austria Group
Tel: +43 (0)664 3361 2730
email: presse@mobilkom.at

Branche: Telecommunications Equipment
ISIN: AT0000720008
WKN: 555750
Index: WBI, ATX Prime, ATX
Börsen: Wiener Börse AG / official dealing
New York / official dealing