BCI AND TELMEX AGREE TO CREATE A PARTNERSHIP TO COMPETE IN THE SOUTH AMERICAN TELECOMMUNICATIONS MARKET.

Will Provide Broadband, Wireless and Internet Services for World’s Fastest Growing Communications Marketplace

Montreal and Mexico City (June 7, 2000) – Teléfonos de México (“Telmex”) [NYSE: TMX] and Bell Canada International Inc. (“BCI”) [NASDAQ: BCICF][TSE: BI], a subsidiary of BCE Inc. (“BCE”) [NYSE: BCE][TSE: BCE], today announced the signing of a definitive agreement under which they will form a new facilities-based communications company to be their principal vehicle for expansion in South America.

The new company is expected to have an initial capitalization of US$3.5 billion, which will include the South American assets of BCI and the Brazilian assets of Telmex, as well as US$1.8 billion in cash and cash commitments from the parties to complete and enhance the existing South American businesses of the partners. Telmex and BCI will hold equal economic interests in the venture.

As of March 31, 2000, the operations that will make up the new enterprise served over 2.5 million total customers via both fixed and mobile networks, in licensed territories with a population of nearly 220 million.

The new enterprise will be uniquely positioned to capture the broadband, mobile wireless and Internet opportunities immediately available in South America through its deployment of competitive networks providing enhanced connectivity on both fixed and mobile platforms. Network development will initially be concentrated in Brazil, Colombia, and Venezuela, with an intention of expanding into other regional markets.

Telmex and BCI have entered into discussions with SBC Communications Inc. (“SBC”) with regard to SBC’s participation in the new company. Based on the discussions to date, BCI and Telmex have offered SBC the right to purchase up to a 25% interest, via contributions of assets and cash. SBC is reviewing the proposal and will make a decision before the end of July. The capitalization of the new enterprise is expected to increase if SBC exercises its right.

Jaime Chico Pardo, Chief Executive Officer of Telmex, said, “This new enterprise will pool the properties, financial strength and expertise of two top telecommunications providers. Both partners firmly believe in the promise of the South American market and recognize the need for high quality, advanced connectivity. The future of this company lies in the deployment of broadband infrastructure to support the spectacular growth of the Internet throughout the region.”

Michael Sabia, Chief Executive Officer of BCI, said, “The launching of this new enterprise is timed to capitalize on the explosive growth in South America for advanced communications services. With South American governments liberalizing their telecommunications markets to meet the escalating demand for basic and advanced services. For BCI, creating this new company continues and advances our strategy of becoming a South American broadband player of consequence by providing us the platform needed to fully achieve the potential of BCI’s existing assets in the region.”

South America  the World’s Fastest Growing Communications Market

With a population of some 350 million people and a low teledensity rate, South America is experiencing rapid growth in the communications sector:  The broadband services market is growing at an annual rate of more than 35%;  The Internet services market is growing at over 40% a year, outpacing global growth by a factor of four to one;  It is projected that the region will add more than 21 million new access lines over five years; and  The mobile wireless base is projected to increase by over 15.4 million new subscribers by 2003.

The partners believe that the current competitive dynamics in South America create an immediate market opening for this new enterprise. This new company will seek to develop a unique market position by deploying competitive, state-of-the-art networks across both fixed and mobile platforms.

The new company intends to leverage its existing properties to build a substantial presence in major markets across the continent, offering a broadening range of services to meet the growing demands of its target residential and business customers.

The new enterprise will be positioned to derive significant benefit from its various properties and platforms, building competitive advantage through the deployment of unified fixed and mobile wireless networks, including the development of metropolitan optical fiber networks.

The new enterprise will continue to seek new partnerships in its markets. Local market partnerships remain critical to the success of the company  especially in the areas of rights-of-way and specialized content. As well, the new company will seek to establish a commercial relationship with T1 MSN, Telmex’s portal joint venture with Microsoft.

Board, Management, and Headquarters

BCI and Telmex will each appoint three directors to the new company’s six-member board. The chairmanship of the new enterprise’s board of directors will rotate on an annual basis between the two shareholders.

Senior officers will be named shortly. The company’s management will be based in Brazil.

Approval Process

The transaction is conditioned upon, among other things, certain regulatory and other consents. The partners anticipate that this process will be completed in an approximately three to four month period.

BCI’s financial advisors are Goldman Sachs and RBC Dominion Securities and its legal advisors are Shearman & Sterling and Stikeman, Elliot in the U.S. and Canada, respectively. Telmex’s legal advisors are Cleary, Gottlieb, Steen & Hamilton and Galicia, Duclaud y Robles in the U.S. and Mexico, respectively.

About BCI

BCI owns, develops, and operates advanced communications companies in markets outside Canada, with an increasing focus on South America. A subsidiary of BCE Inc., Canada’s largest communications company, BCI is listed on the Toronto Stock Exchange under the symbol “BI,” and on the NASDAQ national market under the symbol “BCICF.” Visit our website at www.bci.ca.

About Telmex

Telmex is the leading telecommunications company in Mexico with more than 11.2 million phone lines and 6.5 million wireless customers, offering telecommunications services through a 50,000 kilometer fiber-optics digital network and telecommunications investments in various countries in the region. Telmex and its subsidiaries offer a wide range of advanced services, including wired and wireless communications, data and video services, Internet access as well as integrated telecom solutions to its corporate customers. Information about Telmex is available at http://www.telmex.com.mx/.

Forward-looking Statement

The foregoing communications contain forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995 (the "Safe Harbor Provisions"). References made in the foregoing, in particular, statements made regarding the proposed business combination between BCI and Telmex are based on management’s current expectations or beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. In particular, the following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: inability to obtain, or meet conditions imposed for, governmental approvals; costs related to the business combination; the risk that the BCI and Telmex businesses will not be integrated successfully; and other economic, business, competitive or regulatory factors relating to BCI's and Telmex's businesses generally. BCI and Telmex are under no obligation to (and expressly disclaim any such obligation to) update or alter their forward- looking statements whether as a result of new information, future events or otherwise.