so whats left of NewTel, thier selling out of chin

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    Company Announcements Office
    The Australian Stock Exchange Limited
    Exchange Centre
    20 Bridge Street
    Sydney NSW 2000

    By Facsimile: 1300 300 021


    Dear Sir/Madam

    NEW TEL CONSOLIDATION STRATEGY

    New Tel Limited is pleased to provide details on the continued consolidation of its Australian telecommunications operations.

    Outsourcing telecommunications operations
    Further to an announcement to the market on 12 November 2002, the Company has executed documentation relating to its agreements with RSL Com Partners Pty Ltd (RSL Com) and RSL Com Mobile Pty Ltd (RSL Mobile) to provide operational telecommunications services and infrastructure to New Tel.

    Pursuant to the terms of these agreements, RSL Com and RSL Mobile will assume operative control of the customer management function providing telecommunication services to New Tel's 75,000 customers. RSL Com and RSL Mobile will receive a monthly customer management fee for supplying these services to New Tel.

    The outsourcing programme will not affect customers who will continue to access New Tel's quality products and services and receive the same high standard of customer service. The transfer of customers to the RSL networks commenced last week and is expected to be completed prior to the end of the month.

    The restructuring has resulted in the majority of New Tel's operational roles becoming redundant, with the first redundancy payments to New Tel staff being paid today. Further redundancies will be settled in line with the transfer of operations to RSL Com and RSL Mobile.

    Divesting non-core assets
    As previously announced to the market, the Company is divesting its non-core assets to enable it to focus on the development of its telecommunications business within Australia.

    New Tel is currently considering a number of opportunities to divest its surplus infrastructure including its international gateway switch and satellite earth station facilities. The Company will access operative infrastructure through RSL Com and RSL Mobile, and New Tel will retain responsibility for securing competitive rates for services provided to its customers.

    New Tel has already divested its mobile data communications subsidiary Transcom Communications Systems Ltd (TCS) and is in discussions to sell its remaining interest in leading automotive manufacturer Advanced Engine Components Limited. The Company is also currently evaluating proposals for the sale of its Chinese language portal, nihao.com, to interested parties within Asia Pacific.

    Broadband & Wireless
    Further to an announcement on 19 November 2002, New Tel confirms that Broadband & Wireless Ltd (BWL) has entered into agreements to acquire New Tel's debt to Telstra Corporation Ltd and SingTel Optus Pty Ltd of approximately $22 million.

    BWL is a Hong Kong based company that was established in 2001 to acquire and manage infrastructure and associated subscriber bases within the emerging, and converging broadband and wireless industry sectors.

    New Tel has had material discussions with BWL whereby BWL will convert a portion of the debts it has acquired into ordinary shares in New Tel with the remainder of that debt being paid out of New Tel cash flow. Agreements documenting the terms of those discussions are currently being finalised and are subject to the necessary shareholder approvals.

    This programme provides BWL with the opportunity to participate in the consolidation of the Australian telecommunications industry and work with New Tel to enhance shareholder wealth by growing the Company's customer base both organically and through strategic acquisitions.

    BWL has engaged Mr Gerard Frack, former Optus Director Consumer and Wholesale Mobile as its acting Chief Executive Officer in Australia. BWL and Mr Frack will work with New Tel to develop and implement an aggressive sales and marketing campaign to significantly increase New Tel's customer base as part of the Company's business consolidation programme.

    Both Telstra and Optus have been supportive of New Tel's plans to continue operations through outsourcing, and the agreement with BWL further enhances New Tel's position going forward.

    Programme going forward
    As a result of these strategic alliances, New Tel will improve cash flow from its telecommunications carrier, in accordance with the Company's strategic goals to grow the business profitably.

    Attached is a media release regarding the current programme.


    Yours faithfully


    PETER MALONE
 
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