The Board of Directors of Altadis SA, in its meeting of December 9, 1999, has authorised the purchase by Altadis SA. of 50 % of the shares of Corporacion Habanos, SA, a Cuban corporation, for an amount of around 500 million USD which has been established based not only in the current business of the corporation but essentially in the potentiality of its international growth. Corporacion Habanos SA was constituted in 1994 with the purpose of undertaking the commercialisation of raw tobacco and all the cigar brands of Cuban origin all over the world. Corporation Habanos SA does not have fixed assets, being the owner of all the necessary assets for the commercialisation of Cuban Cigars, as follows: worldwide known emblematic brands, such as Cohiba, Trinitad, Montecristo, Romeo y Julieta, Partagas, Vega Robaina, H. Upmann, Hoyo de Monterrey, Punch, La Gloria Cubana, Bolivar, Ramon allones, Por Larranaga, Fonseca, among others. A distribution network throughout 23 companies all over the world in which local partners have a stake, and also through 69 luxury shops under the franchise " Casas del Habano ". Long Term Supply Agreements with the agricultural and industrial Cuban sector involved in production.

Export volumes are estimated at 150 million units in 1999 (+ 20 % vs previous year). Sales from distribution to the market should stand at 120 million pieces (+ 13 %) and represent a turn over of 288 million USD. Net income should be around 64 million USD (+ 21 %). The Company will hold a debt of 100 M USD at the end of 1999. The payment of the 500 M USD will be made in different steps in the next 3 months, delay used to finalise all the contracts and go through the due diligence process. This Association culminates a centennial relationship based on mutual respect and work in common among the two Companies, Tabacalera and Seita, with the result of the beginning of Altadis, and the Cuban Tobacco Sector. The Altadis Board of Directors has expressed its satisfaction at this agreement, which creates great growth opportunities for the future. Altadis SA, after this Association, consolidates its worldwide leadership in the cigar market.