Contents :

1. INTRODUCTION

The Board of Directors of DiGi wishes to announce that DiGi Telecommunications Sdn Bhd (“DTSB”), a wholly-owned subsidiary of DiGi, had on 25 November 2004 entered into a Sponsorship Agreement with Cosmo’s World Theme Park Sdn Bhd (“Cosmo”) in relation to the sponsorship rights for the IMAX brand granted by Cosmo to DTSB for a total consideration of RM2.0 million ("Sponsorship").

2. INFORMATION ON SPONSORED PARTY- COSMO

Cosmo is a private limited company incorporated in Malaysia under the Companies Act 1965 on 20 July 1995. It is a wholly-owned subsidiary of Berjaya Times Square Sdn Bhd ("BTSSB") where Tan Sri Dato’ Seri Vincent Tan Chee Yioun ("TSVT”), the Chairman of the Company has an 88% interest. The principal activity of Cosmo is the operation of the Cosmo’s World Theme Park and IMAX theatre at Berjaya Times Square, Kuala Lumpur.

Currently, the authorised share capital of Cosmo is RM25 million comprising 25 million ordinary shares of RM1.00 each, of which RM20 million comprising 20 million ordinary shares of RM1.00 each have been issued and fully paid-up.

3. DETAILS OF THE SPONSORSHIP AGREEMENT

The Sponsorship of RM2.0 million is for a tenure of 24 months commencing 1 January 2005 to 31 December 2006. A sum of RM0.25 million shall be paid upon signing of the Sponsorship Agreement and thereafter, RM0.25 million will be paid on quarterly basis until the whole Sponsorship fee is fully paid.

4. RATIONALE

The Sponsorship will enable DTSB to form a strategic alliance with the IMAX® brand, one of the world’s cutting edge entertainment technology. It is expected to provide a positive economic value to the business by promoting and further strengthening the DiGi brand.

The Sponsorship is made in the ordinary course of business with the intent to promote each party’s business and based on an arm’s length basis with normal commercial terms which are consistent with the DiGi Group’s normal business practices.

5. FINANCIAL EFFECTS OF THE SPONSORSHIP

5.1 Share capital and Substantial shareholders’ shareholdings

The Sponsorship will not have any effect on the issued and paid-up share capital, shareholding structure and the shareholdings of the substantial shareholders of DiGi.

5.2 Net Tangible Assets ("NTA") and Earnings Per Share (“EPS”)

The Sponsorship represents approximately 0.14% of the consolidated DiGi’s net tangible assets based on the latest available audited accounts of DiGi Group as at 31 December 2003 and will not have any material effect on the NTA and EPS of DiGi Group in the current and future financial years within the Sponsorship term.

6. APPROVALS REQUIRED

The Sponsorship does not require the approvals of shareholders of the Company or any other relevant government authorities.

7. DIRECTORS' AND MAJOR SHAREHOLDERS' INTERESTS

TSVT, a substantial shareholder of DiGi, is also a deemed substantial shareholder of Cosmo by virtue of his substantial shareholding in BTSSB. He is also the Chairman of DiGi, DTSB and BTSSB.

Save as disclosed, DiGi has not been notified by any other Directors or major shareholders or persons connected to them of having any interests, direct or indirect, in the Sponsorship.

8. DIRECTORS' STATEMENT

The Board of Directors (save for TSVT) is of the opinion that the Sponsorship is in the best interest of DiGi.

9. DOCUMENT FOR INSPECTION

The Sponsorship Agreement dated 25 November 2004, is available for inspection at the registered address of DiGi at 11th Floor, Menara Berjaya, KL Plaza, 179 Jalan Bukit Bintang, 55100 Kuala Lumpur during normal office hours from Monday to Friday (except on public holidays) for a period of three (3) months from the date of this announcement.

Announcement Info