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Portugal Telecom, SGPS S.A. ("PT") hereby informs that it was notified by Banco Espírito Santo, S.A. ("BES") that the latter and Avistar, SGPS, S.A, ("Avistar"), a company wholly owned by BES, entered into an agreement, on 16 July 2014, for the price of €1.83 per share, on an over-the counter transaction, regarding the transfer of 90,000,000 ordinary shares, representing 10.04% of PT's share capital and corresponding voting rights held by Avistar in favour of BES.

PT was further informed that BES and Avistar are persons closely related to PT's Non Executive Directors Joaquim Goes and Amílcar de Morais Pires, being the latter also Chairman of the Board of Directors of Avistar, and therefore both required to notify PT of such transactions pursuant to paragraph 4, b) of article 248-B of the Portuguese Securities Code.

This announcement is made pursuant to article 248-B of the Portuguese Securities Code and article 14 of the CMVM Regulation no. 5/2008 following a communication received from BES, with registered office at Avenida da Liberdade, 195, 1250-142 Lisboa, Portugal.

Contacts: Nuno Vieira, Investor Relations Director
nuno.t.vieira@telecom.pt
Tel.: +351 21 500 1701
Fax: +351 21 500 0800
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