Paris, June 27, 2006 - Alcatel (Paris: CGEP.PA and NYSE: ALA) today announced the signing of a commercial partnership with Algrie Telecom to provide Algerian enterprises with advanced communication services aimed at improving productivity, enhancing business, and furthering enterprises adoption of IP services and managed communication services (MCS).

Algrie Telecom and Alcatel, aware of the changes in business customers' communication usage, aim through this agreement to provide high quality, modern and innovative services by anticipating the needs and responding to the business expectations of the operator's corporate clients. Alcatel delivers an array of user centric services via a comprehensive enterprise portfolio including Unified Communications solutions, Contact Centers, advanced IP Telephony, and IP Networking products. By combining these services into a value added MCS offer, Alcatel will partner with Algrie Telecom to address their enterprise customers needs and allow the to focus on their core business.

"Alcatel has a complete enterprise communications offer. Thanks to this partnership, we will consolidate our leader position as the telecommunications services supplier in Algeria. This agreement also accelerates the modernization of business networks and the transformation of the enterprise customers towards IP solutions."

"Our agreement with Algrie Telecom is part of Alcatel's enterprise alliance strategy with telecom operators, especially within the framework of our recent introduction of our MCS offerings. As Algeria's telecommunications services continue to grow and modernize, Alcatel is honored to be the primary partner with Algeria's incumbent operator in order to meet the communications and business requirements of Algeria's large enterprises." said Pascal Dussiau, general manager for Alcatel enterprise activities in Africa, Middle East, India and Turkey.

This partnership agreement, the first of its kind in the Maghreb area, confirms Alcatel's leadership in enterprise solutions, offering both TDM and IP solutions, all remotely manageable. Whether installed within the enterprise, or hosted by Algrie Telecom, Alcatel's MCS offering enables Algerian enterprises to focus time and resources on their core business, and allows Algrie Telecom to deliver an innovative range of services within a cost optimized environment.

About Alcatel Enterprise solutions With more than 500,000 customers, Alcatel is a leading provider of communication solutions to small, medium, and large enterprises, as well as to public sector institutions worldwide. Alcatel's enterprise portfolio provides business communication applications, including Unified Communications and Contact Centers, an advanced IP Telephony offering, and IP Networking products. Alcatel's enterprise solutions deliver an enhanced competitive edge to businesses of all sizes by increasing customer satisfaction, employee productivity, and operational efficiencies.

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About Alcatel
Alcatel provides communications solutions to telecommunication carriers, Internet service providers and enterprises for delivery of voice, data and video applications to their customers or employees. Alcatel brings its leading position in fixed and mobile broadband networks, applications and services, to help its partners and customers build a user-centric broadband world. With sales of EURO 13.1 billion and 58,000 employees in 2005, Alcatel operates in more than 130 countries. For more information, visit Alcatel on the Internet: http://www.alcatel.com

© Press Release 2006