IDT Europe - Corporate - Press Releases

NEWARK, N.J. - May 3, 2000 - IDT Corporation (NASDAQ: IDTC) today announced it will take an increased equity stake in Terra Networks, S.A. (MC:TRR), the Internet subsidiary of Telefonica S.A., in the form of Terra Networks stock that will essentially quadruple IDT's ownership interest.

Terra Networks is a leading provider of Internet access (ISP) and local-language interactive content and services to residential and small office/home office users in the Spanish and Portuguese-speaking world. IDT is a leading multinational carrier, telephone company and Internet Service Provider.

Under the terms of the signed agreement, IDT will receive ordinary shares of TRR. In exchange for these shares, IDT will transfer to Terra S.A. its 49% ownership in Terra Networks Access Services and its 10% stake in Terra Networks Interactive Services.

"IDT has always enjoyed a mutually beneficial relationship with Terra Networks and greatly values the strategic partnership our two companies have developed,"said Howard Jonas, IDT's Chairman and CEO.

"This new Agreement with Terra is another example of how IDT is taking concrete steps to increase shareholder value," added Jim Courter, President of IDT. "We look forward to working together with Terra in the future."

IDT is a leading facilities-based multinational carrier that combines its position as an international telecommunications operator with its experience as an Internet Service Provider to provide a broad range of telecommunications services to its wholesale and retail customers worldwide.

Through its own telecommunications backbone and network infrastructure IDT provides its customers with integrated and competitively priced international and domestic long distance telephony, prepaid calling cards, Internet access and Digital Subscriber Line (DSL) service. The Company's Ventures business is developing several innovative telecom and Internet related businesses.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. Except for historical information, all of the expectations and assumptions contained in the foregoing are forward-looking statements involving risks and uncertainties. These statements refer to our plans to implement our growth strategy, improve our financial performance, expand our infrastructure, develop new products and services, expand our customer base and enter international markets. The forward looking statements also include our expectations concerning factors affecting the markets for our products, including the demand for long distance telecommunications, and Internet access services. These forward looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the results that we anticipate. These risks and uncertainties include, but are not limited to, those risks discussed in this release. In addition to the factors specifically noted in the forward looking statements, other important factors that could result in those differences include (a) general economic conditions in the telecommunications and Internet markets, including inflation, recession, interest rates, and other economic factors; (b) casualty to or other disruption of our facilities and operations; and (c) other factors that generally affect the business of telecommunications, Internet and other communications companies. We assume no obligation to update these forward looking statements or to update the reasons actual results could differ materially from the results anticipated in the forward looking statements.

Norman Rosenberg
V.P. Finance and Capital Markets
(201) 530-4001

Mary Jennings
Investor Relations
(201) 928-5974