PSE Circular for Brokers No. 2665-98

November 26, 1998 PSE CIRCULAR FOR BROKERS NO. 2665-98 November 25, 1998 Philippine Stock Exchange PSE Center, Exchange Road Ortigas Centre, Pasig City Fax No. 637-88-11 Attention : Ms . Luisa Buenaventura Supervisor, Disclosure Group Gentlemen : We refer to your facsimile message dated 25 November 1998 referring to a news article captioned "Piltel, Smart merger spurs monopoly fears" published in the November 25 issue of Today. You note in your facsimile message that the article reported that the new management of PLDT will "operationally merge" Smart telecommunications, Inc., a subsidiary of First Pacific Co., Ltd., with Pilipino Telephone Corporation (Piltel), the cell phone company of PLDT. You then requested for a written confirmation/clarification of said news article and asked us to make an official, full, fair and accurate written disclosure on the foregoing matter. In view of the foregoing request and further to our earlier telephone conversion with your Ms. Luisa Buenaventura, we would like to state categorically that there is no confirmation of a merger plan between Piltel and Smart at this point in time. We hope we have clarified the issue with this statement. Thank you very much. Very truly yours, PILIPINO TELEPHONE CORPORATION By: (SGD.) JOSEPH A. SANTIAGO Director, Legal Affairs