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Registration No. 333-100213

SECURITIES AND EXCHANGE COMMISSION

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POST-EFFECTIVE AMENDMENT NO. 1

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

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TeliaSonera AB

Sweden		4813		Not Applicable
(State or other jurisdiction of incorporation or organization)		(Primary standard industrial classification code number)		(I.R.S. Employer Identification No.)

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Mårbackagatan 11

Telia International Carrier, Inc.

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Copy of communications to:

Petri Haussila, Esq.

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     Approximate date of commencement of proposed sale of the securities to the public: From time to time after this post-effective amendment to the registration statement becomes effective.

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     If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

     If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

Calculation of Registration Fee

						Proposed Maximum				Aggregate
Title of Each Class of		Amount to be				Offering Price				Offering Price				Amount of
Securities to be Registered		Registered				per Unit				Proposed Maximum				Registration Fee(1)
Ordinary shares, nominal value SEK 3.20 per share(2)			66,719,622	(3)		$	3.81	(4)		$	254,201,759.82	(4)		$	23,386.56
Warrants to purchase ordinary shares			217,602	(5)				(6)			8,093,450.27	(6)		$	744.60
Total											262,295,210.09			$	24,131.16

(1)	Previously paid.
(2)	American depositary receipts (ADRs) evidencing American depositary shares (ADSs) issuable on deposit of the shares of TeliaSonera AB registered hereby have been registered pursuant to a separate Registration Statement on Form F-6.
(3)	The amount to be registered relates to the TeliaSonera shares estimated to be (i) issued to holders of shares of Sonera Corporation in the United States in connection with the exchange offer (including to holders of ADRs evidencing ADSs representing the right to receive Sonera shares and to holders of Sonera warrants entitling holders to subscribe for Sonera shares) and (ii) issued and sold outside of the United States in connection with the exchange offer but that may be resold in the United States from time to time during the distribution thereof.
(4)	Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457 of the Securities Act of 1933, as amended (the “Securities Act”). The registration fee was computed pursuant to Rules 457(c) and 457(f) under the Securities Act based on the average of the high and low sales prices of Sonera shares on the Helsinki Exchanges on September 26, 2002 and the noon buying rate in New York City for cable transfers in euros as certified for customs purposes by the Federal Reserve Bank of New York on September 26, 2002, which was $0.9755 per €1.00.
(5)	The amount to be registered relates to TeliaSonera warrants estimated to be (i) issued to holders of Sonera warrants in the United States in connection with the exchange offer and (ii) issued and sold outside of the United States in connection with the exchange offer but that may be resold from time to time during the distribution thereof.
(6)	The registration fee for the TeliaSonera warrants to be issued to holders of Sonera warrants in connection with the exchange offer is based on the exercise price of each series of Sonera warrants in accordance with Rule 457(g).

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     The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

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December 18, 2002

Dear Sonera Security Holder:

      On December 9, 2002, Telia announced that it had completed its offer to exchange all of outstanding Sonera shares and Sonera American depository shares, or ADSs, and certain Sonera warrants into Telia shares, Telia ADSs, and Telia warrants. I am pleased to inform you that the offer was highly successful. A total of 1,059,532,967 Sonera shares, including shares represented by Sonera ADSs, were tendered in connection with the exchange offer, representing a total of 95.0 percent of the total voting rights attaching to Sonera shares outstanding. In connection with the completion of the exchange offer, Telia AB changed its name to TeliaSonera AB.

      As a result of completion of the exchange offer, TeliaSonera is required under Finnish law to offer to purchase the remaining Sonera shares, whether in the form of shares or ADSs, and warrants, that were not tendered in the exchange offer. TeliaSonera is, accordingly, making a mandatory redemption offer to acquire all of the outstanding shares, including ADSs, and warrants of Sonera that have not been tendered in the exchange offer on the terms and conditions set forth in the attached prospectus supplement. We urge you to read the prospectus supplement and the exchange offer prospectus referred to in the prospectus supplement carefully.

      Under the terms of the mandatory redemption offer:

	•	For each Sonera share you tender, you may elect to receive 1.51440 TeliaSonera shares or, alternatively, €5.00 in cash.
	•	For each Sonera ADS you tender, you may elect to receive 0.30288 TeliaSonera ADSs or, alternatively, the U.S. dollar equivalent of €5.00 in cash (less applicable fees and expenses). Each Sonera ADS represents one Sonera share and each TeliaSonera ADS represents five TeliaSonera shares.
	•	For each Sonera warrant issued pursuant to Sonera’s 1999 and 2000 stock option programs you tender, you may elect to receive one TeliaSonera warrant of a corresponding series or, alternatively, between €0.02 and €1.66 in cash depending on the series of warrants you tender. Each TeliaSonera warrant entitles the holder to subscribe for 1.5 TeliaSonera shares.

      The amount of TeliaSonera shares, TeliaSonera ADSs and TeliaSonera warrants offered in the mandatory redemption offer in exchange for each Sonera share, Sonera ADS and Sonera warrant, respectively, is the same as that offered in the recently completed exchange offer. The cash price of €5.00 per share being offered to holders of Sonera shares, including Sonera shares represented by Sonera ADSs, is based on the volume-weighted average trading price of Sonera shares on the Helsinki Exchanges during the 12-month period from November 15, 2001 to November 15, 2002.

      Sonera shareholders should also be aware that TeliaSonera has started a separate compulsory acquisition proceeding under Finnish law under which the remaining holders of Sonera shares will be required to surrender their remaining Sonera shares to TeliaSonera for redemption at a “fair price.” To the extent shareholders do not participate in the mandatory redemption as described in the attached prospectus supplement, their Sonera shares will be redeemed in connection with the compulsory acquisition proceeding. TeliaSonera has offered to redeem the remaining Sonera shares in the compulsory acquisition proceeding for €5.00 per share. TeliaSonera will provide Sonera shareholders with information regarding the compulsory acquisition proceedings as required under Finnish law.

      On behalf of the Board of Directors of TeliaSonera and the management of TeliaSonera, we thank you for your attention in this matter.

	Sincerely,
	/s/ TAPIO HINTIKKA
	TAPIO HINTIKKA
	Chairman of the Board of Directors

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          As announced on December 9, 2002, to effect the merger between Telia and Sonera, Telia completed an offer to acquire all of the outstanding shares, including shares in the form of American depositary shares, or ADSs, and certain warrants of Sonera Corporation, in exchange for Telia shares, including Telia ADSs, and Telia warrants. As a result of the completion of the exchange offer, which commenced on October 7, 2002 and expired on November 15, 2002, after a five-business day extension, Telia acquired 1,059,532,967 Sonera shares, including shares in the form of ADSs, representing 95.0 percent of the total voting rights attaching to Sonera shares outstanding. In connection with the completion of the exchange offer, Telia AB changed its name to TeliaSonera AB.

          As a result of TeliaSonera’s acquisition of Sonera shares representing more than two-thirds of the total voting rights attaching to Sonera shares, in accordance with the Finnish Securities Market Act, TeliaSonera is required to offer to purchase the remaining Sonera shares, whether in the form of Sonera shares or Sonera ADSs, and Sonera warrants, that were not tendered in the exchange offer. TeliaSonera is, accordingly, making a mandatory redemption offer to acquire all of the outstanding shares, including shares in the form of ADSs, and warrants of Sonera that were not tendered in the exchange offer for either:

•	TeliaSonera shares, in the form of TeliaSonera shares or TeliaSonera ADSs, or TeliaSonera warrants; or
•	cash.

          Under the terms of the mandatory redemption offer:

•	For each Sonera share you tender, you may elect to receive 1.51440 TeliaSonera shares or, alternatively, €5.00 in cash.
•	For each Sonera ADS you tender, you may elect to receive 0.30288 TeliaSonera ADSs or, alternatively, the U.S. dollar equivalent of €5.00 in cash (less applicable fees and expenses). Each Sonera ADS represents one Sonera share and each TeliaSonera ADS represents five TeliaSonera shares.
•	For each Sonera warrant of a certain series issued pursuant to Sonera’s 1999 and 2000 stock option programs you tender, you may elect to receive one TeliaSonera warrant of a corresponding series or, alternatively, between €0.02 and €1.66 in cash depending on the series of warrants you tender. Each TeliaSonera warrant entitles the holder to subscribe for 1.5 TeliaSonera shares.

          The amount of TeliaSonera shares, TeliaSonera ADSs and TeliaSonera warrants offered in the mandatory redemption offer in exchange for each Sonera share, Sonera ADS and Sonera warrant, respectively, is the same as that offered in the exchange offer. The cash price of €5.00 per share being offered to holders of Sonera shares, including Sonera shares represented by Sonera ADSs, is based on the volume-weighted average trading price of Sonera shares on the Helsinki Exchanges during the 12-month period from November 15, 2001 to November 15, 2002, the time when Telia’s obligation to commence a mandatory redemption offer first arose in accordance with the Finnish Securities Market Act.

          The mandatory redemption offer to holders of Sonera shares, Sonera ADSs and Sonera warrants will commence on Monday, December 30, 2002 and will expire at 9:00 a.m. New York City time (4:00 p.m. Helsinki time) on Friday, January 31, 2003, unless the mandatory redemption offer is extended.

          TeliaSonera’s shares are listed on the A-list of the Stockholm Exchange under the symbol “TLSN” and on the main list of the Helsinki Exchanges under the symbol “TLS1V.” TeliaSonera’s ADSs are quoted on the Nasdaq National Market, or NASDAQ, under the symbol “TLSN.” TeliaSonera’s series 2002/2005:A warrants are listed on the Helsinki Exchanges under the symbol “TLS1VEW102.” On December 17, 2002, the closing price of TeliaSonera’s shares on the Stockholm Exchange and the Helsinki Exchanges was SEK 33.10 and €3.59 per share, respectively, and the closing price of TeliaSonera ADSs on NASDAQ was $18.40 per ADS.

          This mandatory redemption offer prospectus supplements the exchange offer prospectus, dated October 1, 2002. You should read this prospectus supplement together with the exchange offer prospectus.

          See “RISK FACTORS” beginning on page S-12 of this prospectus supplement and on page 27 of the exchange offer prospectus to read about factors you should consider before investing in TeliaSonera’s securities.

We are not asking you for a proxy and you are requested not to send us a proxy.

          Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus supplement is December 18, 2002.

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QUESTIONS AND ANSWERS ABOUT THE MANDATORY REDEMPTION OFFER
WHERE YOU CAN FIND MORE INFORMATION
IMPORTANT INFORMATION
SUMMARY
	Background
	Mandatory Redemption Offer Price and its Determination
	Compulsory Acquisition
	Ownership of TeliaSonera in Sonera
	Agreements on the Use of Voting Power in Sonera
	Delisting of Sonera Securities
	Change of Name from Telia AB to TeliaSonera AB
RISK FACTORS
THE COMPANIES
	TeliaSonera
	Sonera
	Ownership of TeliaSonera
	Ownership of Sonera
	Recent Developments
THE MANDATORY REDEMPTION OFFER
	General Terms
	Change in the share capital of TeliaSonera following completion of the mandatory redemption offer
		Issue of shares and warrants on November 28, 2002.
		Issue of shares and transfer of warrants upon completion of the mandatory redemption offer.
	Determination of the Offer Price
	Market Price Information
	Restrictions on Ability of Certain Persons to Participate in the Mandatory Redemption Offer
	Mandatory Redemption Offer Period and Extension
	Procedures for Tendering
		Holders of Sonera Shares
		Holders of Sonera ADSs
		Holders of Sonera Warrants
	Withdrawal Rights
	Validity of the Tender of Securities
	Announcement of the Results of the Mandatory Redemption Offer
	Acceptance of Sonera Securities, Terms of Payment and Delivery of TeliaSonera Securities
	Dividend Payments
	Fractional Entitlements to TeliaSonera Shares and TeliaSonera ADSs
	Costs and Finnish Transfer Taxes
	Compulsory Acquisition
	Trading in Sonera Securities During the Mandatory Redemption Offer Period and After the Expiration of the Mandatory Redemption Offer Period
	Financing of the Mandatory Redemption Offer
	Listing of TeliaSonera Shares, TeliaSonera ADSs and TeliaSonera Warrants 2002/2005:A
	Delisting of Sonera Securities
	Ownership of Sonera in TeliaSonera
	Fees and Expenses
TAXATION
	Finnish Tax Considerations
	Swedish Tax Considerations
	United States Federal Income Tax Considerations
ENFORCEMENT OF CIVIL LIABILITIES
ANNEX A ARTICLES OF ASSOCIATION OF TELIASONERA AKTIEBOLAG
ANNEX B Interim Report January-September 2002
	Disclosure Obligation in Finland
ANNEX C Interim Report July-September 2002
INFORMATION NOT REQUIRED IN THE PROSPECTUS
SIGNATURES
SIGNATURE OF AUTHORIZED REPRESENTATIVE OF THE REGISTRANT
Acceptance Form
Acceptance Form
Letter of Transmittal
Notice of Guaranteed Delivery
Brokers Letter
Clients Letter
Exchange Agreement

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TABLE OF CONTENTS

				Page
QUESTIONS AND ANSWERS ABOUT THE MANDATORY REDEMPTION OFFER					S-1
WHERE YOU CAN FIND MORE INFORMATION					S-5
IMPORTANT INFORMATION					S-6
INDICATIVE TIMETABLE					S-8
SUMMARY					S-9
	Background				S-9
	Mandatory Redemption Offer Price and Its Determination				S-9
	Compulsory Acquisition				S-10
	Ownership of TeliaSonera in Sonera				S-10
	Agreements on the Use of Voting Power in Sonera				S-11
	Delisting of Sonera Securities				S-11
	Change of name from TeliaAB to TeliaSonera AB				S-11
RISK FACTORS					S-12
THE COMPANIES					S-14
	TeliaSonera				S-14
	Sonera				S-14
	Ownership of TeliaSonera				S-14
	Ownership of Sonera				S-15
	Recent Developments				S-16
THE MANDATORY REDEMPTION OFFER					S-20
	General Terms				S-20
	Determination of the Cash Offer Price				S-22
	Market Price Information				S-23
	Restrictions on Ability of Certain Persons to Participate in the Mandatory Redemption Offer				S-23
	Mandatory Redemption Offer Period and Extension				S-24
	Procedures for Tendering				S-24
		Holders of Sonera Shares			S-24
		Holders of Sonera ADSs			S-25
		Holders of Sonera Warrants			S-27
	Withdrawal Rights				S-28
	Validity of the Tender of Securities				S-29
	Announcement of the Results of the Mandatory Redemption Offer				S-30
	Acceptance of Sonera Securities, Terms Payment and Delivery of TeliaSonera Securities				S-30
	Dividend Payments				S-31
	Fractional Entitlements to TeliaSonera shares and TeliaSonera ADSs				S-32
	Costs and Finnish Transfer Taxes				S-32
	Compulsory Acquisition				S-33
	Trading in Sonera Securities During the Mandatory Redemption Offer Period and After the Expiration of the Mandatory Redemption Offer Period				S-34
	Financing of the Mandatory Redemption Offer				S-34
	Listing of TeliaSonera Shares, TeliaSonera ADSs and TeliaSonera Warrants 2002/2005:A				S-34
	Delisting of Sonera Securities				S-34
	Ownership of Sonera in TeliaSonera				S-35
	Fees and Expenses				S-35
TAXATION					S-36
	Finnish Tax Considerations				S-36
	Swedish Tax Considerations				S-37
	United States Federal Income Tax Considerations				S-37
ENFORCEMENT OF CIVIL LIABILITIES					S-40
ANNEX A: ARTICLES OF ASSOCIATION OF TELIASONERA AB					A-1
ANNEX B: TELIA’S INTERIM REPORT FOR THE THIRD QUARTER OF 2002					B-1
ANNEX C: SONERA’S INTERIM REPORT FOR THE THIRD QUARTER OF 2002					C-1

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QUESTIONS AND ANSWERS ABOUT THE MANDATORY REDEMPTION OFFER

Q.	What is the proposed transaction?
A.	In accordance with Finnish law, TeliaSonera is making a mandatory redemption offer to acquire all of the outstanding Sonera shares, whether in the form of shares or ADSs, and Sonera warrants that it did not acquire in connection with Telia’s exchange offer for all of the outstanding Sonera shares, Sonera ADSs and certain Sonera warrants.
Q.	What will Sonera securityholders receive in this mandatory redemption offer?
A.	Under the terms of the mandatory redemption offer:

	•	For each Sonera share you tender, you may elect to receive 1.51440 TeliaSonera shares or, alternatively, €5.00 in cash.
	•	For each Sonera ADS you tender, you may elect to receive 0.30288 TeliaSonera ADSs or, alternatively, the U.S. dollar equivalent of €5.00 in cash (less applicable fees and expenses). Each Sonera ADS represents one Sonera share and each TeliaSonera ADS represents five TeliaSonera shares.
	•	For each Sonera warrant of a certain series issued pursuant to Sonera’s 1999 and 2000 stock option programs you tender, you may elect to receive one TeliaSonera warrant of a corresponding series or, alternatively, between €0.02 and €1.66 in cash depending on the series of warrants you tender. Each TeliaSonera warrant entitles the holder to subscribe for 1.5 TeliaSonera shares.

Q.	I am a registered holder of Sonera shares. How do I participate in this mandatory redemption offer?
A.	If you are a holder of Sonera shares registered directly in the shareholders’ register held by the Finnish Central Securities Depository, or the FCSD, and you wish to accept the mandatory redemption offer, you must complete, sign and return the acceptance form which, unless otherwise agreed with your account operator, is being mailed to you. The acceptance form must be returned to your account operator on or before the expiration of the mandatory redemption offer period. If your account operator requires you to return the acceptance form before the expiration of the mandatory redemption offer period, you must return the acceptance form to your account operator on or before such date and time specified by your account operator. Shareholders who have their Sonera shares registered with the FCSD can accept the mandatory redemption offer at any asset management branch of Nordea Bank Finland Plc, the Finnish share agent.
Q.	I hold Sonera shares through a nominee. How do I participate in this mandatory redemption offer?
A.	If your Sonera shares are registered in the name of a nominee (e.g., an agent, bank, broker or other custodial institution) and you wish to accept the mandatory redemption offer, you have to make such acceptance in accordance with the nominee’s instructions. TeliaSonera will not send you any documents relating to the mandatory redemption offer directly.
Q.	I hold certificates for Sonera ADSs. How do I participate in this mandatory redemption offer?
A.	If you hold certificates for Sonera ADSs, complete and sign the enclosed ADS letter of transmittal and deliver it, together with your Sonera ADR certificates, evidencing your Sonera ADSs, and any other required documents, to the U.S. exchange agent at one of the addresses set forth on the ADS letter of transmittal before the expiration of this mandatory redemption offer.
Q.	I hold Sonera ADSs in book-entry form. How do I participate in this mandatory redemption offer?
A.	If you hold your Sonera ADSs in book-entry form, instruct your broker or custodian to arrange, before the expiration date of this mandatory redemption offer, for the book-entry transfer of your Sonera ADSs into the U.S. exchange agent’s account at The Depository Trust Company, commonly known as DTC, and deliver a message to the U.S. exchange agent via DTC’s book-entry confirmation system confirming that you have received and agree to be bound by the terms of

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	this mandatory redemption offer. Your broker or custodian will provide you with a form you must complete to instruct your broker or custodian to tender your Sonera ADSs.
Q.	I am a registered holder of Sonera warrants. How do I participate in this mandatory redemption offer?
A.	If you are a holder of Sonera warrants directly registered in the register of warrantholders held by the FCSD and you wish to accept the mandatory redemption offer, you must complete, sign and return the acceptance form which, unless otherwise agreed with your account operator, is being mailed to you. The acceptance form must be returned to your account operator on the date of or before the expiration of the mandatory redemption offer period. If your account operator requires you to return the acceptance form before the expiration of the mandatory redemption offer period, you must return the acceptance form to your account operator on or before such date specified by your account operator. Warrantholders who have their Sonera warrants registered with the FCSD can accept the mandatory redemption offer at any asset management branch of the Finnish share agent.
Q.	I hold Sonera warrants through a nominee. How do I participate in this mandatory redemption offer?
A.	If your Sonera warrants are registered in the name of a nominee (e.g., an agent, bank, broker or other custodial institution) and you wish to accept the mandatory redemption offer, you have to make such acceptance in accordance with the nominee’s instructions. TeliaSonera will not send you any documents relating to the mandatory redemption offer directly.
Q.	How do I elect whether to receive TeliaSonera securities or cash in connection with my tender of Sonera securities?
A.	In the event you are a holder of Sonera shares directly registered in the register of shareholders held by the FCSD, a holder of Sonera warrants directly registered in the register of warrant holders held by the FCSD or a holder of Sonera ADR certificates, in completing the applicable acceptance form or ADS letter of transmittal, you should complete the appropriate information in the acceptance form or ADS letter of transmittal as to whether you are electing to receive TeliaSonera shares, TeliaSonera ADSs or TeliaSonera warrants, or alternatively, cash consideration in connection with the mandatory redemption offer. Directly registered holders of Sonera shares or Sonera warrants or holders of Sonera ADR certificates who fail to fill in the appropriate election information as between consideration in cash or securities will be deemed, unless they have a different arrangement with their account operator or unless their account operator has different procedures for the processing of acceptances, to have elected to receive TeliaSonera shares, TeliaSonera ADSs or TeliaSonera warrants, respectively, in the mandatory redemption offer.

If you hold Sonera shares or Sonera warrants through a nominee or if you hold Sonera ADSs in book-entry form, you must instruct your nominee, broker or custodian to make the appropriate election. If you hold Sonera shares or Sonera warrants through a nominee or if you hold Sonera ADSs in book-entry form and you fail to properly instruct your nominee, broker or custodian to make the appropriate election between cash or securities, you will be deemed, unless you have a different arrangement with your nominee, broker or custodian, to have elected to receive TeliaSonera shares, TeliaSonera ADSs or TeliaSonera warrants, respectively, in the mandatory redemption offer.

Q.	How long do I have to decide whether to tender in the mandatory redemption offer?
A.	Unless extended by TeliaSonera, the mandatory redemption offer will expire at 9:00 a.m. New York City time/4:00 p.m. Helsinki time on Friday, January 31, 2003, after which time you will no longer be able to tender your Sonera shares, Sonera ADSs or Sonera warrants in the mandatory redemption offer. TeliaSonera may extend the mandatory redemption offer as described below under the next caption.
Q.	Can the mandatory redemption offer be extended and, if so, under what circumstances?
A.	Yes. TeliaSonera may extend the mandatory redemption offer at any time and for any

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	reason in accordance with applicable laws and regulations. TeliaSonera will not extend the mandatory redemption offer period by more than ten business days.
Q.	Can I change my mind and decide not to participate in this mandatory redemption offer after I tender my securities?
A.	To the extent you elected to receive TeliaSonera securities in the mandatory redemption offer, you may withdraw your tender of Sonera securities at any time before the expiration of the mandatory redemption offer period, scheduled for 9:00 a.m. New York City time/4:00 p.m. Helsinki time, on Friday, January 31, 2003. If this mandatory redemption offer is extended, you may also withdraw your tender during such extended mandatory redemption offer period.

	If, however, you elected to receive cash consideration in connection with the mandatory redemption offer, the payment of cash will be made as promptly as practicable after the receipt of your acceptance of the mandatory redemption offer and you will not have the right to withdraw your tender of Sonera securities.

Q.	Will I receive fractional interests in TeliaSonera shares or TeliaSonera ADSs?
A.	No. To the extent you elect to receive TeliaSonera securities as consideration for the Sonera securities you tender, you will not receive fractional TeliaSonera shares or fractional TeliaSonera ADSs in connection with the mandatory redemption offer. You will receive cash consideration to the extent you are entitled to fractions of TeliaSonera shares or TeliaSonera ADSs in exchange for your Sonera shares or Sonera ADSs. Your fractional entitlements will be combined with those of other holders and subsequently sold on your behalf and on the behalf of such other holders on the Stockholm Exchange or the Helsinki Exchanges, in the case of TeliaSonera shares, or on NASDAQ, in the case of TeliaSonera ADSs. You will receive cash corresponding to the net proceeds of the sale of your fractional entitlement to a TeliaSonera share or TeliaSonera ADS.
Q.	If I elect to receive TeliaSonera securities as consideration in the mandatory redemption offer, when will I receive my TeliaSonera securities and any cash attributable to any fractional TeliaSonera securities?
A.	TeliaSonera will deliver the TeliaSonera securities to be issued in the exchange for properly tendered Sonera securities on or about 11 business days after the expiration of the mandatory redemption offer period. The Finnish share agent or the U.S. exchange agent, as applicable, will deliver any cash to which you may be entitled within ten business days after the sale of the combined fractional entitlements on the Stockholm Exchange or the Helsinki Exchanges, in the case of TeliaSonera shares or, on NASDAQ, in the case of TeliaSonera ADSs.
Q.	If I elect to receive cash consideration in the mandatory redemption offer, when will I receive my cash consideration?
A.	TeliaSonera will make cash payments,

	•	in the case of a tendering Sonera shareholder or Sonera warrantholder, into the bank account related to the book-entry account of such tendering Sonera securityholder within five business days after the execution of the sale of the tendered Sonera securities to TeliaSonera on or outside the Helsinki Exchanges. Such sale will be executed within five business days after the receipt of acceptance relating to such Sonera securities; and
	•	in the case of a tendering Sonera ADS holder, (a) by book-entry transfer of the applicable amount in U.S. dollars into the DTC account of the DTC participant which tendered the Sonera ADSs on behalf of such holder in the mandatory redemption offer by means of the DTC book-entry confirmation system or (b) by means of a check in U.S. dollars to the order of the tendering Sonera ADS holder as provided in the corresponding ADS letter of transmittal, in either case, as promptly as practicable after the execution of the sale of the Sonera shares underlying the Sonera ADSs to TeliaSonera on or outside the Helsinki Exchanges.

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Q.	If I decide not to tender my Sonera securities in the mandatory redemption offer, will I be entitled to any appraisal rights?
A.	TeliaSonera has initiated a compulsory acquisition proceeding under the Finnish Companies Act, under which TeliaSonera is requiring that you, as a remaining holder of Sonera shares or Sonera ADSs, surrender, and you may demand that TeliaSonera redeem, your Sonera shares or Sonera ADSs at, absent a separate agreement, a “fair price” as determined by an arbitration tribunal. Finnish law does not provide for any other kind of appraisal rights.

	The compulsory acquisition proceeding does not cover Sonera warrants. Any Sonera warrants not tendered in connection with the mandatory redemption offer will remain outstanding and exercisable subject to the terms and conditions of such warrants.

Q.	Will I have to pay brokerage commissions?
A.	No, as long as your Sonera securities are registered in your name and you tender them directly to:

	•	the Finnish share agent or your book-entry account operator, if you hold Sonera shares or Sonera warrants; or
	•	the U.S. exchange agent, if you hold Sonera ADSs.

	If your Sonera securities are held through your bank, broker or other nominee, you should consult with them as to whether or not they will charge any transaction fee or service charge to tender your Sonera securities in the mandatory redemption offer.

Q.	Who can answer my questions?
A.	If you hold shares or warrants you should contact your book entry account operator.

Clients of Nordea Bank Finland Plc should contact:

Nordea Bank Finland Plc

If you hold ADSs you should contact either:

• The information agent in the United States:

Georgeson Shareholders Communications Inc.

or

• The U.S. exchange agent at:

Citibank, N.A.

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WHERE YOU CAN FIND MORE INFORMATION

      TeliaSonera, formerly known as Telia AB, has filed a registration statement on Form F-4 to register with the U.S. Securities and Exchange Commission, or SEC, the TeliaSonera shares and TeliaSonera warrants that Sonera shareholders and warrantholders received in the exchange offer and will receive in the mandatory redemption offer, including TeliaSonera shares represented by TeliaSonera ADSs and the TeliaSonera shares issuable upon exercise of the TeliaSonera warrants, and a registration statement on Form F-6 in respect of the TeliaSonera ADSs. This document is a part of the registration statement on Form F-4 and together with the exchange offer prospectus constitutes a prospectus of TeliaSonera. As allowed by the SEC, this prospectus supplement and the exchange offer prospectus do not contain all of the information included in the registration statement, some parts of which are omitted in accordance with the rules and regulations of the SEC. For further information, you should refer to the registration statement.

      The SEC permits TeliaSonera and Sonera to “incorporate by reference” information into this prospectus supplement and the exchange offer prospectus. This means that we can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this document, except for any information superseded by information contained directly in this document.

      TeliaSonera and Sonera incorporate by reference the documents listed below that we filed with the SEC under the Securities Exchange Act of 1934:

	•	Sonera’s report on Form 6-K dated October 1, 2002;
	•	Sonera’s report on Form 6-K dated October 2, 2002;
	•	Sonera’s report on Form 6-K dated October 8, 2002;
	•	Sonera’s report on Form 6-K dated October 9, 2002;
	•	Sonera’s report on Form 6-K dated October 10, 2002;
	•	Sonera’s report on Form 6-K dated October 25, 2002;
	•	Sonera’s report on Form 6-K dated October 31, 2002;
	•	Sonera’s report on Form 6-K dated November 5, 2002;
	•	Sonera’s reports on Form 6-K dated November 7, 2002;
	•	Sonera’s reports on Form 6-K and Form 6-K/A dated November 8, 2002;
	•	Sonera’s report on Form 6-K dated November 13, 2002;
	•	Sonera’s report on Form 6-K dated November 14, 2002;
	•	Sonera’s report on Form 6-K dated November 18, 2002;
	•	Sonera’s reports on Form 6-K dated November 21, 2002;
	•	Sonera’s report on Form 6-K dated November 26, 2002;
	•	Sonera’s report on Form 6-K/A dated November 27, 2002;
	•	Sonera’s reports on Form 6-K dated November 27, 2002;
	•	Sonera’s report on Form 6-K dated November 29, 2002;
	•	Sonera’s report on Form 6-K dated December 3, 2002;
	•	Sonera’s reports on Form 6-K dated December 9, 2002;
	•	Sonera’s report on Form 6-K dated December 11, 2002; and
	•	Sonera’s report on Form 6-K dated December 16, 2002.

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      Each of these reports on Form 6-K contains press releases that Sonera has filed with the Helsinki Exchanges in both Finnish and English. These press releases are available through the Internet web site maintained by the Helsinki Exchanges at www.hex.fi.

      In addition, TeliaSonera and Sonera incorporate by reference into this document additional documents and any amendments thereto that they may file with or submit to the SEC from the date of this document to the date of completion of the mandatory redemption offer. These include reports such as any special reports on Form 6-K so designated.

      You may read and copy any reports, statements or other information on file with the SEC, including the exchange offer prospectus, at the SEC’s public reference room located at 450 Fifth Street, NW, Washington, D.C. 20549 or at one of the SEC’s other public reference rooms in New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. SEC filings are also available to the public from commercial document retrieval services and at the Internet world wide web site maintained by the SEC at www.sec.gov. You will also be able to inspect any periodic reports and other information filed with the SEC by TeliaSonera at the offices of the Nasdaq National Market. Documents incorporated by reference are available without charge, excluding all exhibits unless an exhibit has been specifically incorporated by reference into this document. Shareholders may obtain documents incorporated by reference into this document by requesting them in writing or by telephone from the appropriate company at the following addresses:

TeliaSonera AB Marbackagatan 11 S-123 86 Farsta, Sweden +46 8 713 1000 www.telia.com		Sonera Corporation Teollisuuskatu 15 FIN-00510 Helsinki, Finland +358 20401 www.sonera.com

      If you would like to request documents from TeliaSonera or Sonera, in order to obtain timely delivery, please make your request no later than five business days before the end of the mandatory redemption offer period, or Friday, January 24, 2003.

      If you would like to receive a copy of the exchange offer prospectus, please contact Georgeson Shareholders Communications Inc., the information agent in the United States, 17 State Street, 10th Floor, New York, NY 10004, telephone: (212) 440-9800 (banks and brokers) or (866) 297-1410 (all others).

      You should rely only on the information contained in or incorporated by reference into this prospectus supplement. No one has been authorized to provide you with information that is different from what is contained in, or incorporated by reference into, this prospectus supplement. This prospectus supplement is dated December 18, 2002. You should not assume that the information contained in, or incorporated by reference into, this prospectus supplement is accurate as of any date other than that date, and neither the mailing of this prospectus supplement, nor the issuance of new TeliaSonera shares, TeliaSonera ADSs or TeliaSonera warrants shall create any implication to the contrary.

IMPORTANT INFORMATION

      This mandatory redemption offer prospectus consists of this prospectus supplement and the exchange offer prospectus. Unless the context requires otherwise, all references in this document to “this prospectus” include this prospectus supplement and the exchange offer prospectus.

      In connection with the completion of the exchange offer, Telia AB changed its name to TeliaSonera AB. In this prospectus supplement, all references to “Telia” are to Telia AB prior to the completion of the exchange offer and all references to “TeliaSonera” are to TeliaSonera AB from the time of the completion of the exchange offer and the change of Telia AB’s name to TeliaSonera AB.

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      Please be advised that the terms and conditions of the mandatory redemption offer differ in certain respects from the terms and conditions of the exchange offer. Accordingly, we strongly urge you to read this entire prospectus supplement.

      Certain information presented in tabular format in this prospectus supplement have been rounded to the nearest whole number or the nearest decimal. Therefore, the sum of a number in a column may not conform exactly to the total figure given for the column.

Notice to Residents of Australia

      This prospectus supplement may not contain all the information required to be contained in disclosure documents under the laws of Australia. TeliaSonera is not subject to the continuous disclosure requirements of the Corporations Act 2001 (Commonwealth).

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INDICATIVE TIMETABLE

•   Beginning of the mandatory redemption offer period			December 30, 2002
•   Expiration of the mandatory redemption offer period			January 31, 2003	*
•   Announcement by TeliaSonera and Sonera of the results of the mandatory redemption offer			On or about February 6, 2003	*
•   Delivery of TeliaSonera securities			On or about February 17, 2003	*
•   TeliaSonera shares and TeliaSonera warrants 2002/2005:A issued in connection with the mandatory redemption offer become eligible for trading on the main list of the Helsinki Exchanges		On or about February 17, 2003

*		These dates will change if TeliaSonera extends the mandatory redemption offer period.

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RISK FACTORS

      In deciding whether to tender your Sonera securities in connection with the mandatory redemption offer, you should carefully consider the risks set forth below and the risks discussed under the caption “RISK FACTORS” in the exchange offer prospectus in addition to the other information contained in this prospectus supplement and the exchange offer prospectus.

To the extent you elect to receive TeliaSonera securities in connection with the mandatory redemption offer, you will receive a fixed number of TeliaSonera securities and not a fixed value. As a result, the value of the TeliaSonera securities you will receive at the completion of the mandatory redemption offer may be less than the value of such TeliaSonera securities at the date of this prospectus supplement or the date you tender your Sonera securities.

      Under the terms of the mandatory redemption offer, holders of Sonera securities are being offered a fixed number of securities of TeliaSonera, rather than securities of TeliaSonera with a fixed value. Because the market price of the TeliaSonera shares may fluctuate, the value of the TeliaSonera securities you receive at the time of the completion of the mandatory redemption offer will depend on the market price of such securities at that time and may vary significantly from the value of such securities at the date of this prospectus supplement. The terms of the mandatory redemption offer will not be adjusted based on fluctuations in the market price of TeliaSonera shares or on the relative financial performance of TeliaSonera and Sonera. As a result, the market price of the TeliaSonera securities you receive at the time of the completion of the mandatory redemption offer could be significantly lower than the market price of such securities at the date of this prospectus supplement.

      The price of TeliaSonera shares may change as a result of changes in the business, operations or prospects of TeliaSonera, market assessments of the impact of the merger, regulatory considerations, general market and economic conditions, factors affecting the telecommunications industry in general and other factors. You should obtain current market quotations for TeliaSonera’s and Sonera’s securities.

If you elect to receive cash consideration in the mandatory redemption offer, your election will be irrevocable and you will not be able to withdraw your tender.

      Under the terms of the mandatory redemption offer, to the extent you elect to receive cash consideration for the Sonera securities you tender in the mandatory redemption offer, TeliaSonera will arrange for the cash payment to be made as promptly as practicable after the execution of the sale of the tendered Sonera securities to TeliaSonera. As a result, you will not have the right to withdraw your tender of Sonera securities to the extent you elect to receive cash consideration in the mandatory redemption offer.

If you are a holder of Sonera shares or ADSs and you did not participate in the mandatory redemption offer you will be required to participate in a compulsory acquisition proceeding that will result in a cash payment that may be either less or more than the value of the consideration to be delivered in connection with the mandatory redemption offer.

      On December 9, 2002, TeliaSonera notified Sonera that it had commenced a compulsory acquisition procedure under the Finnish Companies Act, under which it has the right to redeem the remaining Sonera shares from the minority shareholders of Sonera, whether in the form of shares or ADSs, to TeliaSonera for a “fair price.” TeliaSonera announced that it will offer to redeem the remaining Sonera shares, including shares in the form of ADSs, at a price of €5.00 per share in the compulsory acquisition procedure. Any disputes concerning the right of redemption or the redemption price in a compulsory acquisition will be resolved by an arbitral tribunal of one or more arbitrators appointed by the Central Chamber of Commerce of Finland in accordance with the Finnish Companies Act. Under the Finnish Companies Act, the arbitration tribunal so appointed has considerable latitude in deciding upon the method or methods used in determining the “fair price” of the shares of the target company and in establishing the final amount of such “fair price”; inasmuch as the Finnish Companies Act does not contain any similar provisions to those included in the Finnish Securities Market Act and used in the determination of the “fair price” established in connection

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The market for your Sonera securities may be less liquid than before the mandatory redemption offer and if you do not participate in the mandatory redemption offer, the value of your Sonera securities may be lower.

      The exchange of Sonera securities pursuant to the mandatory redemption offer will reduce the number of Sonera securityholders and the number of Sonera securities that might otherwise trade publicly and, depending upon the number of Sonera securities so tendered, could adversely affect the liquidity and market value of the remaining Sonera securities held by the public. Furthermore, Sonera effected a delisting of Sonera ADSs from NASDAQ as of the close of business on December 6, 2002, in connection with the completion of the exchange offer. While it is possible that the Sonera ADSs would continue to be traded in the over-the-counter market and that price quotations would be reported, there can be no assurance that such an over-the-counter market will develop. The extent of the public market for the Sonera ADSs and the availability of such quotations will depend upon such factors as the number of holders remaining after the completion of the mandatory redemption offer, the interest on the part of securities firms in maintaining a market in Sonera ADSs, the announced termination of the deposit agreement for the Sonera ADSs and the possible termination of registration of Sonera’s securities under the Exchange Act, which would adversely affect the amount of publicly available information on Sonera’s securities. Sonera will also seek to delist its shares and warrants from the Helsinki Exchanges as soon as practicable under applicable rules and regulations.

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THE COMPANIES

TeliaSonera

      In connection with the completion of Telia’s exchange offer for all of the outstanding shares, including shares in the form of ADSs, and certain warrants of Sonera, Telia changed its name to TeliaSonera. Certain information about TeliaSonera, its business, results of operations and financial condition is included in the exchange offer prospectus under the captions “THE TRANSACTION — The Combined Company Following the Exchange Offer,” “INFORMATION ABOUT TELIA,” “OPERATING AND FINANCIAL REVIEW AND PROSPECTS OF TELIA,” “INFORMATION ABOUT SONERA” and “OPERATING AND FINANCIAL REVIEW AND PROSPECTS OF SONERA.” To the best knowledge of TeliaSonera, as of the date of this prospectus supplement, the information contained in this prospectus supplement, as well as the exchange offer prospectus, relating to TeliaSonera is in all material respects in accordance with the facts and this prospectus supplement and the exchange offer prospectus does not omit anything likely to affect the import of such information in any material respect.

Sonera

      As a result of the completion of the exchange offer, Sonera Corporation is a 95.0 percent owned subsidiary of TeliaSonera. Certain information about Sonera, its business, results of operations and financial condition is included in sections “INFORMATION ABOUT SONERA,” and “OPERATING AND FINANCIAL REVIEW AND PROSPECTS OF SONERA” in the exchange offer prospectus. To the best knowledge of TeliaSonera, as of the date of this prospectus supplement, the information contained in this prospectus supplement, as well as the exchange offer prospectus, relating to Sonera is in all material respects in accordance with the facts and this prospectus supplement and the exchange offer prospectus does not omit anything likely to affect the import of such information in any material respect.

Ownership of TeliaSonera

      As of December 9, 2002, TeliaSonera’s issued and outstanding share capital was SEK 14,738,421,520.00 consisting of 4,605,756,725 TeliaSonera shares, nominal value SEK 3.20 each. Each TeliaSonera share entitles the holder to one vote at general meetings of shareholders. The calculation of percentages in the “Percentage of outstanding shares” column in the table below is based upon the number of TeliaSonera shares issued and outstanding on November 29, 2002. As of November 29, 2002, the principal shareholders of TeliaSonera and their respective holdings (calculated as if the exchange offer had been completed as of November 29, 2002, and each share tendered pursuant to the exchange offer were exchanged for TeliaSonera shares as of such date) were as follows:

							Percent of
			Number of				outstanding shares
Shareholder			shares(1)				and votes(1)
							(%)
Swedish State(2)				2,118,278,261				46.0
Finnish State(3)				891,800,231				19.4
Robur Fonder				84,421,225				1.8
SEB fonder				38,719,016				0.8
Alecta				36,830,096				0.8
AMF Pension				35,000,000				0.8
Första AP-fonden				27,720,045				0.6
AFA Försäkring				27,404,700				0.6
Fjärde AP-fonden				26,782,700				0.6
Skandia				25,371,533				0.6
Other shareholders				1,293,428,918				28.1
	Total			4,605,756,725				100.0
Members of the TeliaSonera board of directors (as a group) (4)				25,384,948				0.6

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(1)		Calculated as if the exchange offer had been completed as of November 29, 2002, and each Sonara share tendered pursuant to the exchange offer were exchanged for TeliaSonera shares as of November 29, 2002.
(2)		The business address and telephone number of the Swedish State is c/o The Swedish Ministry of Industry, Employment and Communications, Jakobsgatan 26, SE-103 33 Stockholm, Sweden, +46-8-4051000.
(3)		The business address and telephone number of the Finnish State is c/o The Finnish Ministry of Transport and Communications, Eteläesplanadi 16-18, P.O. Box 31, FIN-00023 Government, Finland, +358-9-16002.
(4)		Includes 25,361,533 TeliaSonera shares beneficially owned by Livförsäkrings AB Skandia, a wholly owned subsidiary of Försäkringsaktiebolaget Skandia. Lars-Eric Petersson, Deputy Chairman of the TeliaSonera board of directors is also President, Chief Executive Officer and director of Försäkringsaktiebolaget Skandia. Mr. Petersson may be deemed to have an interest in the TeliaSonera shares beneficially owned by Livförsäkrings AB Skandia within the meaning of Rule 13d-3 under the Exchange Act; however, Mr. Petersson believes that he does not possess the power to direct the voting of these shares and disclaims beneficial ownership of the TeliaSonera shares held by Livförsäkrings AB Skandia.

Ownership of Sonera

      As of December 9, 2002, Sonera’s issued and outstanding share capital was €479,579,743.47, consisting of 1,115,301,729 Sonera shares, without nominal value. Each Sonera share entitles the holder to one vote at general meetings of shareholders. The calculation of percentages in the “Percentage of outstanding shares” column in the table below is based upon the number of Sonera shares issued and outstanding on December 9, 2002.

      The principal shareholders of Sonera and their respective holdings were as follows:

							Percent of
			Number of				outstanding shares
Shareholder			shares				and votes
							(%)
TeliaSonera AB				1,059,532,967				95.0
Sonera Corporation (treasury shares)				550,000				0.0
Norvestia Oy Ab				145,000				0.0
Assai Oy				40,000				0.0
BNP Arbitrage				29,200				0.0
Kalevi Korsu				21,667				0.0
Estate of Johann Siefen				15,839				0.0
Markku Koskinen				15,000				0.0
Mikko Pursiheimo				14,500				0.0
Spede-Tuotanto Oy				13,500				0.0
Nominee registered foreign owners in total				49,607,157				4.4
Other shareholders				5,316,899				0.5
	Total			1,115,301,729				100.0

      Sonera currently holds 550,000 of its own shares, equal to approximately 0.05 percent of Sonera’s outstanding shares. Sonera cannot exercise voting rights with respect to such shares held in treasury.

      The depositary has advised Sonera that, as of December 9, 2002, there were 2,409,109 Sonera ADSs outstanding, representing approximately 0.22 percent of outstanding Sonera shares, held by 86 record holders. A significant number of Sonera ADSs are held of record by broker nominees. The number of beneficial owners of Sonera ADSs is unknown but Sonera estimates that the number of beneficial owners of Sonera ADSs was approximately 9,000 as of December 9, 2002.

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Ownership of TeliaSonera in Sonera

      As of the date of this prospectus supplement, TeliaSonera holds 1,059,532,967 Sonera shares, representing approximately 95.0 percent of the total voting rights attaching to the Sonera shares outstanding, including Sonera shares represented by Sonera ADSs. In addition, as of the date of this prospectus supplement, TeliaSonera holds 26,746,972 Sonera warrants, each of which entitles the holder of one Sonera share. Except for Sonera shares, including Sonera shares represented by Sonera ADSs, and Sonera warrants acquired by TeliaSonera pursuant to the exchange offer and except for any Sonera shares owned by Sonera as treasury shares, neither TeliaSonera nor, to the best of TeliaSonera’s knowledge, any of its affiliates, as defined in the Finnish Securities Market Act, owns any Sonera securities or possesses any voting rights in Sonera.

Recent Developments

Completion of the Exchange Offer

      As a result of the completion of the exchange offer, which commenced on October 7, 2002 and expired on November 15, 2002 after a five business day extension, Telia acquired 1,059,532,967 Sonera shares, representing 95.0 percent of the total voting rights attaching to the Sonera shares outstanding. In connection with the completion of the exchange offer, Telia AB changed its name to TeliaSonera AB. On December 9, 2002, TeliaSonera shares and series 2002/2005:A warrants became available for trading on the Helsinki Exchanges and TeliaSonera ADSs became available for trading on NASDAQ.

The Board of Directors of TeliaSonera

      The board of directors of TeliaSonera currently has eleven ordinary members, composed of a chairman, a deputy chairman and nine other directors, three of whom are employee representatives. The current members of the board of directors of TeliaSonera and certain information relevant to such persons are set forth below:

										Number of TeliaSonera
										shares owned as of
Name		Year Born				Director Since				November 29, 2002(1)				Position
Tapio Hintikka			1942				2002				—			Chairman
Lars-Eric Petersson			1950				2000				4,800	(2)		Deputy Chairman
Carl Bennet			1951				2000				10,000	(3)		Director
Ingvar Carlsson			1934				2000				400			Director
Eva Liljeblom			1958				2002				999			Director
Caroline Sundewall			1958				2001				1,000			Director
Roger Talermo			1955				2002				—			Director
Tom von Weymarn			1944				2002				4,316			Director
Yvonne Karlsson			1959				2001				100			Director(4)
Berith Westman			1945				1993				650			Director(4)
Elof Isaksson			1942				2000				1,150			Director(4)

(1)		Calculated as if the exchange offer had been completed as of November 29, 2002, and each of the Sonera shares tendered by the members of the TeliaSonera board of directors pursuant to the exchange offer were exchanged for TeliaSonera shares as of November 29, 2002.
(2)		Excludes 25,361,533 shares beneficially owned by Livförsäkrings AB Skandia, an affiliate of Skandia, of which Mr. Petersson is the President, Chief Executive Officer and a member of the board of directors.
(3)		Includes shareholdings through affiliated person.
(4)		Employee representative.

      For summary biographical information regarding TeliaSonera’s directors see the information included under the captions “DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES OF TELIA” and

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      Mr. Tapio Hintikka, Chairman of the board of directors of TeliaSonera, retired from Hackman Oyj Abp on December 1, 2002.

      Under the terms of the shareholders’ agreement between the Kingdom of Sweden and the Republic of Finland, as amended, relating to the combination of Telia and Sonera, the board of directors of the combined company is to comprise a total of nine non-executive members and up to three employee representatives. Of the nine initial members of the board of directors, one was to have been a newly appointed director who was not previously a member of the board of directors of either Telia or Sonera. Mr. Anders Igel, the President and Chief Executive Officer of TeliaSonera, was elected to serve, upon the completion of the exchange offer, as the ninth member of the board of directors of TeliaSonera. Mr. Igel, however, subsequently relinquished his position as an appointee to the TeliaSonera board of directors. The ninth member of TeliaSonera’s board of directors is expected to be nominated in connection with the annual general meeting of shareholders of TeliaSonera in 2003.

      On December 10, 2002, Lars-Eric Petersson announced that he will not seek reelection to the board of directors of TeliaSonera at the annual general meeting of shareholders of TeliaSonera in 2003.

Management of TeliaSonera

      TeliaSonera operates as an integrated company with strong central control over strategic matters and over achievement of synergies and stand-alone improvements. At the same time, responsibilities for achieving profitability, day-to-day operations and local business is decentralized to country-based profit centers managed without frequent corporate headquarter management involvement. Central control of TeliaSonera is to be carried out by the corporate headquarters and two operational units.

Corporate Headquarters

      The executive officers of TeliaSonera include:

	•	Anders Igel, chief executive officer.
	•	Harri Koponen, deputy chief executive officer.
	•	Kim Ignatius, chief financial officer.
	•	Michael Kongstad, responsible for corporate communications.
	•	Jan Henrik Ahrnell, responsible for corporate legal affairs.

      Harri Koponen will as of January 1, 2003 be responsible for the operational unit Marketing, Products and Services, with responsibility for the control of common product and services development in TeliaSonera’s home markets and key account responsibility for large multi-domestic home market accounts.

      Lars-Gunnar Johansson is responsible for the operational unit Networks and Technology, which is responsible for the common telecommunications platforms and IT support platforms in TeliaSonera’s home markets and also has responsibility for procurement.

      The two operational units, Marketing, Products and Services and Networks and Technology, will have authority over country-based profit centers on central control matters and over decisions involving a longer time horizon. Country-based profit centers and the two operational units will use the same financial reporting systems, including customer segment profits, product segment profits and selected key performance indicators.

Country-based Profit Centers

      Country-based profit centers are grouped into four units as of January 1, 2003. The persons responsible for such profit centers are as follows:

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	•	Marie Ehrling, responsible for the profit center Sweden.
	•	Anni Vepsäläinen, responsible for the profit center Finland.
	•	Kenneth Karlberg, responsible for the profit center Norway, the Baltic countries and Denmark.
	•	Aimo Eloholma, responsible for the profit center International Operations, which will include Russia, Turkey, Eurasia and International Carrier.

      Country-based profit centers are to be responsible for all operational resources, including marketing, sales, network operations and development of products and services. In Sweden and Finland, the network operations units will be maintained separately from the units carrying out the corresponding retail activities, with transparent financial reporting, and will also provide wholesale services to third-party operators. In Sweden and Finland, profit center responsibilities are allocated based on the following customer segments: consumer, business and large corporate customers.

      For summary biographical information regarding the management of TeliaSonera see the information included under the captions “DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES OF TELIA” and “DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES OF SONERA” in the exchange offer prospectus.

      Marie Ehrling will assume the position of Head of TeliaSonera’s Swedish operations on January 1, 2003. Ms. Ehrling was previously the Deputy Chief Executive Officer and Chief Operating Officer for SAS, the Scandinavian airlines group.

Legal and Regulatory Proceedings

      On October 23, 2002, Elisa Communications Oyj filed a complaint against Sonera with the FCA claiming that Sonera’s pricing for providing wholesale broadband Internet services (ADSL) to other telecommunications operators is discriminatory and excessive under the Finnish Competition Act. On October 30, 2002, Sonera received a request for information from the Finnish Competition Authority (FCA) regarding Sonera’s pricing of broadband Internet services. Sonera responded to this request on November 29, 2002. Sonera is currently not in a position to assess what the final outcome of this complaint will be.

      On November 8, 2002, Sonera was served a writ by the trustee for the bankruptcy estate of Broadband Mobile AB, a company formed to exploit a UMTS license in Norway in which Sonera held a 50 percent interest. In the writ the bankruptcy estate trustee asserts claims of NOK 332 million (approximately €45 million) primarily from the shareholders of Broadband Mobile AB and alternatively from the board members and the CEO of Broadband Mobile AB. Based upon advice of counsel, Sonera believes that it has good defenses against the claims and intends to defend vigorously against such claims.

      In October 2002, the Finnish newspaper Helsingin Sanomat published allegations that certain current or former executives and/or employees of Sonera had acted in violation of the Finnish Telecommunications Data Privacy Act. In response to these allegations, the Finnish Communications Regulatory Authority (FICORA) opened an investigation into the matter. On November 13, 2002, FICORA issued a decision in which it found defects in Sonera’s management of information security and the processing of identification data and required Sonera to bring itself into compliance with the Telecommunications Data Privacy Act. Based on the request filed by Sonera in October 2002, the Finnish National Bureau of Investigation has also been investigating the allegations. Five Sonera employees, including Jari Jaakkola, then executive vice president and member of Sonera’s executive management team, who has been responsible for corporate communications and investor relations within Sonera, and Henri Harmia, then vice president and head of the integration efforts of the Telia-Sonera combination, were detained in connection with the investigation on the basis of suspicion of reasonable grounds for gross violations of the Telecommunications Data Privacy Act. Each of these employees was subsequently released. In addition, Kaj-Erik Relander, who served as president and chief executive officer of Sonera from January 1, 2001 to July 31, 2001 was also temporarily detained by the National Bureau of Investigation on the basis of suspicion of reasonable grounds for gross violations of the Telecommunications Data Privacy Act and subsequently released. While no official charges in this matter

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      On December 11, 2002, TeliaSonera filed a petition with the Turkish Capital Markets Board to seek an exemption from the tender offer requirements under Turkish capital markets regulations that would otherwise require TeliaSonera to make a tender offer for the remaining shares of Turkcell Iletisim Hizmetleri A.S.

Results of Operations for the Three Months Ended September 30, 2002

      On October 25, 2002, Telia announced the results for its third quarter of 2002. For the three months ended September 30, 2002, Telia had net sales of SEK 14,496 million (€1,584 million), a slight increase over net sales of SEK 14,431 million (€1,577 million) for the comparable period in 2001. Telia recorded an operating loss of SEK 10,815 million (€1,182 million) in the three months ended September 30, 2002, as compared to operating income of SEK 2,745 million (€300 million) for the comparable period in 2001, mainly as a result of write downs of Telia International Carrier’s fixed assets and fixed network operations in Denmark amounting to SEK 8,936 million (€976 million) and restructuring costs of SEK 2,825 million (€309 million) and SEK 286 million (€31 million) in relation to Telia International Carrier and Telia’s Danish operations, respectively.

      Telia’s interim report for the three months ended September 30, 2002 is included as Annex B to this prospectus supplement.

      On October 25, 2002, Sonera announced its results for its third quarter of 2002. For the three months ended September 30, 2002, Sonera had revenues of €551 million (SEK 5,043 million), a slight increase over net sales of €549 million (SEK 5,024 million) for the comparable period in 2001. Sonera recorded an operating profit of €100 million (SEK 915 million) in the three months ended September 30, 2002, a 59 percent increase over operating profit of €63 million (SEK 577 million) for the comparable period in 2001, mainly due to the lower losses from Sonera’s Service Businesses segment and the consolidation of Fintur Holdings B.V. as of the beginning of September 2002.

      Sonera’s interim report for the three months ended September 30, 2002 is included as Annex C to this prospectus supplement.

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THE MANDATORY REDEMPTION OFFER

General Terms

Sonera Shares and ADSs

      TeliaSonera is offering:

	•	1.51440 TeliaSonera shares, nominal value SEK 3.20 each, or, alternatively, €5.00 in cash, in exchange for each Sonera share, with no nominal value, validly tendered in the mandatory redemption offer; and
	•	0.30288 TeliaSonera ADSs or, alternatively, the U.S. dollar equivalent of €5.00 in cash (less applicable fees and expenses), in exchange for each Sonera ADS validly tendered in the mandatory redemption offer. Each Sonera ADS represents one Sonera share and each TeliaSonera ADS represents five TeliaSonera shares.

      Fractional entitlements to TeliaSonera shares or TeliaSonera ADSs will not be delivered to holders of Sonera securities validly tendered in the mandatory redemption offer. Instead, fractional entitlements to TeliaSonera shares or TeliaSonera ADSs following from the exchange ratio will subsequently be combined and sold on the Stockholm Exchange or the Helsinki Exchanges, in the case of TeliaSonera shares, or on NASDAQ, in the case of TeliaSonera ADSs, in each case on behalf of, and proceeds of the sales (after deduction of related fees and expenses) will be distributed pro rata to, the Sonera security holders entitled to fractional entitlements. See “— Fractional Entitlements to TeliaSonera Shares and TeliaSonera ADSs” below.

      The 550,000 Sonera shares currently held by Sonera in treasury are excluded from the mandatory redemption offer.

Sonera Warrants

      TeliaSonera is offering one warrant issued by TeliaSonera or, alternatively, cash in exchange for each warrant issued pursuant to Sonera’s 1999 and 2000 stock option programs validly tendered in the mandatory redemption offer. In this connection TeliaSonera is offering:

	•	one TeliaSonera warrant 2002/2005:A or, alternatively, €0.96 in cash for each Sonera warrant

	•	one TeliaSonera warrant 2002/2005:B or, alternatively, €0.23 in cash for each Sonera warrant

	•	one TeliaSonera warrant 2002/2008:A or, alternatively, €0.02 in cash for each Sonera warrant 2000A1;
	•	one TeliaSonera warrant 2002/2008:B or, alternatively, €0.02 in cash for each Sonera warrant 2000B1;
	•	one TeliaSonera warrant 2002/2008:C or, alternatively, €0.02 in cash for each Sonera warrant 2000C1;
	•	one TeliaSonera warrant 2002/2008:D or, alternatively, €0.34 in cash for each Sonera warrant 2000A2;
	•	one TeliaSonera warrant 2002/2008:E or, alternatively, €0.34 in cash for each Sonera warrant 2000B2;
	•	one TeliaSonera warrant 2002/2008:F or, alternatively, €0.34 in cash for each Sonera warrant 2000C2;
	•	one TeliaSonera warrant 2002/2010:A or, alternatively, €1.11 in cash for each Sonera warrant 2000A3;
	•	one TeliaSonera warrant 2002/2010:B or, alternatively, €1.11 in cash for each Sonera warrant 2000B3;

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	•	one TeliaSonera warrant 2002/2010:C or, alternatively, €1.11 in cash for each Sonera warrant 2000C3;
	•	one TeliaSonera warrant 2002/2010:D or, alternatively, €1.66 in cash for each Sonera warrant 2000A4;
	•	one TeliaSonera warrant 2002/2010:E or, alternatively, €1.66 in cash for each Sonera warrant 2000B4; and
	•	one TeliaSonera warrant 2002/2010:F or, alternatively, €1.66 in cash for each Sonera warrant 2000C4.

      The warrants are subject to terms and conditions complying with Swedish market practice for listed companies as well as certain additional terms and conditions, reflecting the terms and conditions of the Sonera warrants. The approximately 0.95 percent difference between the exchange ratio for Sonera shares, whereby holders of Sonera shares will receive 1.51440 TeliaSonera shares for each Sonera share they tender, and the terms of the TeliaSonera warrants, whereby each TeliaSonera warrant will entitle the holder thereof to subscribe for 1.5 TeliaSonera shares, has been compensated for by setting the exercise price of each TeliaSonera warrant at a correspondingly lower level than the exercise price for the Sonera warrants. The terms of the warrants issued by TeliaSonera are described under the caption “THE EXCHANGE OFFER — Terms and Conditions of the New Telia Warrants” in the exchange offer prospectus.

Change in the share capital of TeliaSonera following completion of the mandatory redemption offer

      At the extraordinary general meeting in Telia held on November 4, 2002, it was resolved to authorize the board of directors of Telia to decide on the issuance of shares and debentures with attached warrants to subscribe for new shares necessary for the completion of the exchange offer together with any subsequent mandatory redemption offer.

Issue of shares and warrants on November 28, 2002.

      In accordance with such authorization, the board of directors of Telia decided, on November 28, 2002, to issue 1,604,556,725 new Telia shares in furtherance of the exchange offer. The board of directors also resolved to issue debentures with a total of 31,220,339 attached warrants to subscribe for new Telia shares, each warrant entitling the holder to subscribe for 1.5 new Telia shares. The debentures with attached warrants were subscribed for by Telia Förlagslan AB, a wholly-owned subsidiary of Telia AB, for further transfer to holders of Sonera warrants who tendered their Sonera warrants in the exchange offer or in the subsequent mandatory redemption offer. Following completion of the exchange offer a total of 26,746,972 TeliaSonera warrants were transferred from Telia Förlagslan AB to Sonera warrant holders who had tendered their Sonera warrants in the exchange offer.

      As of the date of this prospectus supplement, the issued share capital of TeliaSonera is SEK 14,738,421,520, consisting of 4,605,756,725 TeliaSonera shares, each with a nominal value of SEK 3.20.

Issue of shares and transfer of warrants upon completion of the mandatory redemption offer.

      Upon completion of the mandatory redemption offer, the board of directors of TeliaSonera will resolve, as authorized by the shareholders at the extraordinary shareholders meeting on November 4, 2002, to increase the share capital of TeliaSonera from SEK 14,738,421,520 by a maximum of SEK 281,883,334.40 to a maximum of SEK 15,020,304,854.40, through the issuance of a maximum of 88,088,542 new TeliaSonera shares, the maximum share issue being based on the assumption that (i) all remaining holders of Sonera shares and Sonera ADSs tender their Sonera shares and Sonera ADSs in the mandatory redemption offer in exchange for TeliaSonera shares and ADSs, respectively, and (ii) all holders of Sonera warrants, excluding TeliaSonera, exercise their warrants to subscribe for Sonera shares, and thereafter tender these Sonera shares in the mandatory redemption offer in exchange for TeliaSonera shares. The maximum of 88,088,542 new

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      Assuming none of the holders of Sonera warrants exercise their warrants to subscribe for Sonera shares, but instead tender their Sonera warrants in the mandatory redemption offer in exchange for TeliaSonera warrants, upon completion of the mandatory redemption offer, a maximum of 2,948,527 TeliaSonera warrants will be transferred from Telia Förlagslan AB to holders of Sonera warrants who tender their Sonera warrants. Upon completion of the mandatory redemption offer, Telia Förlagslan AB will in such case, as a result of the exchange offer and the mandatory redemption offer, have transferred a total of 29,695,499 TeliaSonera warrants, each entitling the holder to subscribe for 1.5 new TeliaSonera shares. If fully subscribed and assuming that all holders of Sonera shares and Sonera ADSs tender their shares in exchange for TeliaSonera shares and TeliaSonera ADSs, respectively, in the mandatory redemption offer, these warrants will lead to an increase in the share capital of TeliaSonera from SEK 15,006,016,057.60 by a maximum of SEK 142,538,393.60 to a maximum of SEK 15,148,554,451.20 through issuance of a maximum of 44,543,248 new TeliaSonera shares, corresponding to a dilution of 0.9 percent in relation to the number of issued and outstanding TeliaSonera shares as of the date of this prospectus supplement.

Determination of the Offer Price

      According to the Finnish Securities Market Act, TeliaSonera is required to make a mandatory redemption offer to purchase the remaining Sonera shares, including Sonera shares represented by Sonera ADSs, and Sonera warrants for cash at their “fair price.” The “fair price” to be paid in connection with a mandatory redemption offer shall be determined by taking into account: (i) the volume-weighted average trading price of the target company’s shares during the 12-month period prior to the time when the obligation to commence a mandatory redemption offer first arises, (ii) any higher price paid by the bidder for the target company’s shares purchased during such 12-month period, and (iii) any special circumstances.

      In a ruling dated September 30, 2002, the Finnish Financial Supervision Authority stated that, in the case of an exchange offer, the duty to commence a mandatory redemption offer, if any, subsequent to such exchange offer under the Finnish Securities Market Act, shall arise at the expiration of the exchange offer period and the 12-month period referred to in item (i) and item (ii) above should be deemed to refer to the 12-month period ending at the time of the expiration of the exchange offer period.

      In relation to item (ii) above, the Finnish Financial Supervision Authority stated in its ruling that the purchases of Sonera shares by Telia pursuant to the exchange offer would be taken into account as purchases of Sonera shares and that, in order to determine whether the cash redemption price paid in connection with such purchases were to be considered higher than the 12-month volume-weighted average trading price determined pursuant to item (i) above, the Telia shares offered in connection with the exchange offer should be valued based upon the lower of the volume-weighted average price prevailing for the Telia shares during a relatively short period prior to the expiration of the exchange offer period (for example, five trading days) and the market price prevailing for Telia shares prior to the announcement of the exchange offer, which equalled €4.41 per Telia share (based upon the closing market price per Telia share on March 25, 2002, converted into euros at the SEK-to-euro currency exchange rate for that day). In the event that the exchange offer consideration, based upon such method of valuation, represented a value more than insignificantly higher than the volume-weighted average trading price of the Sonera shares during the 12-month period prior to the expiration of the exchange offer period, such higher value should be taken into account in establishing the “fair price.” In addition, the Finnish Financial Supervision Authority stated that, by extending the exchange offer on terms unchanged to the remaining shareholders of Sonera in connection with the mandatory redemption offer so that the shareholders of Sonera have an opportunity to choose between the cash redemption price and share consideration in the form of TeliaSonera shares, TeliaSonera is released from any obligation to pay a higher cash redemption price as a result of item (ii) above. The discussion above is also relevant, to the extent applicable, to Sonera warrants.

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      TeliaSonera’s obligation to make the mandatory redemption offer arose at the expiration of the exchange offer period on November 15, 2002. The volume-weighted average trading price of Sonera’s shares during the 12-month period from November 15, 2001 to November 15, 2002 is €5.00. In accordance with the ruling of the Finnish Financial Supervision Authority, the purchases of Sonera shares by Telia pursuant to the exchange offer have not been taken into account in calculating the volume-weighted average trading price of Sonera’s shares.

      Except for the purchases of Sonera shares and Sonera warrants by Telia pursuant to the exchange offer, neither TeliaSonera nor, to the best of its knowledge, any of its affiliates, as defined in the Finnish Securities Market Act, has acquired Sonera shares or securities that are convertible, exchangeable or redeemable for Sonera shares during the period from November 15, 2001 to November 15, 2002.

      The cash price per warrant being offered to holders of the Sonera warrants 1999A is based on the volume-weighted average trading price of such warrants on the Helsinki Exchanges during the 12-month period from November 15, 2001 to November 15, 2002.

      Sonera warrants of a series other than the 1999A series are not listed on any established market. The cash price per such unlisted series of Sonera warrants has been determined based on conventional option valuation methods. In making such valuations, the unlisted Sonera warrants have been treated as European call options without applying any discount to reflect certain special conditions of the warrants.

      For a discussion of the determination of the exchange ratios used in connection with the exchange offer and this mandatory redemption offer, see the description included under the caption “THE TRANSACTION” in the exchange offer prospectus.

Market Price Information

      The volume-weighted average trading price of Sonera shares on the Helsinki Exchanges during the 12-month period from November 15, 2001 to November 15, 2002 is €5.00.

      The volume-weighted average trading price of Sonera 1999A warrants on the Helsinki Exchange during the 12-month period from November 15, 2001 to November 15, 2002 is €0.96.

Restrictions on Ability of Certain Persons to Participate in the Mandatory Redemption Offer

      Due to restrictions under the laws of Australia, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan and New Zealand, the mandatory redemption offer, insofar as it comprises an offer of TeliaSonera securities, will not be made in any of Australia, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan or New Zealand. The mandatory redemption offer will, however, insofar as it comprises an offer of cash, be made in Australia, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan or New Zealand.

      Due to restrictions under the laws of Italy and South Africa, the mandatory redemption offer, both as it comprises an offer of TeliaSonera securities or cash, will not be made in Italy or South Africa.

      The legal restrictions mentioned above will, however, not prevent persons in such restricted jurisdictions from having their Sonera securities redeemed in a compulsory acquisition proceeding as described elsewhere in this prospectus supplement.

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Mandatory Redemption Offer Period and Extension

      The offer to holders of Sonera shares, ADSs and warrants will commence on Monday, December 30, 2002 and expire at 9:00 a.m. New York City time/4:00 p.m., Helsinki time on Friday, January 31, 2003 unless the offer is extended.

      Under Finnish law, TeliaSonera may, from time to time, extend the period of time during which the mandatory redemption offer is open. In addition, TeliaSonera will not extend the mandatory redemption offer period by more than ten business days.

      If TeliaSonera extends the period of time during which the mandatory redemption offer is open, the mandatory redemption offer will expire at the latest time and date to which TeliaSonera extends the mandatory redemption offer. TeliaSonera expects to announce by press release on or about four business days following the expiration date of the mandatory redemption offer period (i) the number of outstanding Sonera shares, Sonera ADSs and Sonera warrants that have been validly tendered pursuant to the offer and (ii) whether the mandatory redemption offer will be extended. These announcements will also be posted on TeliaSonera’s website at www.telia.com.

      TeliaSonera will accept all Sonera securities that have been validly tendered and not withdrawn pursuant to the terms of the mandatory redemption offer. TeliaSonera reserves the right, at any time and from time to time beginning two business days after the commencement of the mandatory redemption offer period, to extend or amend this mandatory redemption offer in any respect in accordance with applicable law, provided, however, that the mandatory redemption offer period must be at least one month.

Procedures for Tendering

      TeliaSonera has retained Nordea Bank Finland Plc to act as Finnish share agent in connection with the mandatory redemption offer made to holders of Sonera shares and warrants. TeliaSonera has retained Citibank, N.A. to act as the U.S. exchange agent in connection with the mandatory redemption offer made to Sonera ADS holders.

Holders of Sonera Shares

      If you are a holder of Sonera shares who is directly registered in the shareholders’ register held by the Finnish Central Securities Depository on or about December 27, 2002, you will receive an acceptance form with tender instructions from the book-entry account operator managing the book-entry account where your Sonera shares are registered, unless otherwise agreed with the account operator. The acceptance forms are also available from your book-entry account operator.

      Shareholders who have their shares registered with the FCSD can accept the mandatory redemption offer at any asset management branch of Nordea Bank Finland Plc, the Finnish share agent.

      If your Sonera shares are registered in the name of a nominee (or other custodial institution) and you wish to accept the mandatory redemption offer, you have to make such acceptance in accordance with such nominee’s instructions. TeliaSonera will not send you any documents relating to the mandatory redemption offer directly.

      If your Sonera shares have been pledged, the consent of the appropriate pledgee is required for acceptance of the mandatory redemption offer and it is your responsibility to obtain such consent.

      If you wish to accept the mandatory redemption offer, you have to complete, sign and return the acceptance form to your account operator in accordance with such account operator’s instructions or to any asset management branch of the Finnish share agent on or before 4:00 p.m. Helsinki time on Friday, January 31, 2003 or, if the mandatory redemption offer period has been extended, before the expiry of the mandatory redemption offer period as extended. Your book-entry account operator may ask you to return your acceptance form at an earlier date. Do not send your acceptance form to TeliaSonera or Sonera.

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      You may accept the mandatory redemption offer only in relation to all of your Sonera shares. If you hold both Sonera shares and Sonera warrants, or Sonera warrants of more than one series, you are not obligated to tender all of your Sonera securities but may elect instead to tender only your Sonera shares or your Sonera warrants of a particular series. Except as provided in the foregoing sentence, any partial tender of your Sonera shares may be rejected as a non-acceptance of the mandatory redemption offer. Under the terms of the mandatory redemption offer, you may elect to receive only one form of consideration, either TeliaSonera shares or cash, with respect to the total number of Sonera shares you validly tender in the mandatory redemption offer.

      By accepting the mandatory redemption offer, you authorize Nordea Bank Finland Plc or your account operator to effect the transfer of your Sonera shares to TeliaSonera in exchange for either TeliaSonera shares or cash, as the case may be, including the necessary registrations in the book-entry account and the authorization to subscribe for TeliaSonera shares, and to transfer the title of tendered Sonera shares to TeliaSonera. The authorization also covers the sale of any fractional entitlements to TeliaSonera shares by Nordea Bank Finland Plc as described below under “— Fractional Entitlements to TeliaSonera Shares and TeliaSonera ADSs.”

      If you elect to receive TeliaSonera shares in exchange for your Sonera shares, following receipt of a duly completed acceptance form by your account operator or any asset management branch of the Finnish share agent, each Sonera share you have tendered in the mandatory redemption offer will be converted into one Sonera exchanged share, which represents a Sonera share in the book-entry system that has been tendered and designated for exchange. The Sonera exchanged shares will be registered on your book-entry account. You must allow five business days for the registration of the acceptance before the Sonera exchanged shares are entered into your book-entry account. You may not transfer any of your Sonera exchanged shares and your Sonera exchanged shares will not be eligible for trading on the Helsinki Exchanges. A transfer restriction in respect of such exchanged shares will be registered in the book-entry system. During the mandatory redemption offer period and until the completion of the mandatory redemption offer by TeliaSonera, each Sonera exchanged share is equal to and, with the exception of the transfer restriction, carries the same rights as one Sonera share.

      In connection with the completion of the mandatory redemption offer, each Sonera exchanged share will be converted into 1.51440 TeliaSonera shares. See “— Fractional Entitlements to TeliaSonera Shares and TeliaSonera ADSs.”

      The conversion will take place after the increase in TeliaSonera’s share capital in connection with the completion of the mandatory redemption offer has been registered with the Swedish Patent and Registration Office.

      The method of delivery of acceptance forms and all other required documents is at your option and risk, and the delivery will be deemed made only when actually received by your book-entry account operator or an asset management branch of the Finnish share agent. In all cases, you should follow the instructions sent to you by your book-entry account operator and allow sufficient time to ensure timely delivery.

      If you are a holder of Sonera shares located outside Finland and the United States, please see “— Restrictions on Ability of Certain Persons to Participate in the Mandatory Redemption Offer” above.

Holders of Sonera ADSs

      If you hold your Sonera ADSs in the form of a Sonera ADR certificate, you may tender your Sonera ADSs to the U.S. exchange agent by delivering to the U.S. exchange agent a properly completed and duly executed letter of transmittal, with all applicable signature guarantees from an eligible guarantor institution, together with the Sonera ADR certificate evidencing your Sonera ADSs specified on the face of the letter of transmittal, prior to the expiration date for the mandatory redemption offer.

      If you hold your Sonera ADSs in a brokerage account, you should instruct your broker, dealer, commercial bank, trust company or other entity through which you hold your Sonera ADSs to arrange for the DTC participant holding the Sonera ADSs in its DTC account to tender your Sonera ADSs in the mandatory

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      Tendered Sonera ADSs will be held in an account controlled by the U.S. exchange agent, and consequently you will not be able to sell, assign, transfer or otherwise dispose of such securities, until such time as (1) you withdraw your Sonera ADSs from the mandatory redemption offer; (2) your Sonera ADSs have been exchanged for TeliaSonera ADSs (in which case you will only be able to sell, assign, transfer or otherwise dispose of the TeliaSonera ADSs received in respect of your Sonera ADSs); or (3) your Sonera ADSs have been returned to you because they were not accepted for exchange.

      Please note that registered holders of Sonera ADSs should send their properly completed and duly executed letters of transmittal together with their corresponding Sonera ADR certificate(s) only to the U.S. exchange agent and not to TeliaSonera or Sonera. Letters of transmittal properly completed and duly executed, together with the corresponding Sonera ADR certificates, must be received by the U.S. exchange agent before 9:00 a.m., New York City time, on January 31, 2003 to be accepted for exchange. The method of delivery of Sonera ADR certificates and letters of transmittal and all other required documents is at your option and risk, and the delivery will be deemed made only when actually received by the U.S. exchange agent. In all cases, you should allow sufficient time to ensure timely delivery.

      You may accept the mandatory redemption offer only in relation to all of your Sonera ADSs.

Guaranteed Delivery Procedures

      If you desire to tender your Sonera ADSs in the mandatory redemption offer and your Sonera ADSs are not immediately available or time will not permit all required documents to reach the U.S. exchange agent prior to the expiration date of the mandatory redemption offer or the procedure for book-entry transfer cannot be completed on a timely basis, you may nevertheless properly tender your Sonera ADSs if all the following conditions are satisfied:

	•	your tender is made by or through an eligible institution;
	•	a properly completed and duly executed notice of guaranteed delivery, substantially in the form provided with this prospectus supplement, is received by the U.S. exchange agent as provided below prior to the expiration date; and
	•	Sonera ADSs in proper form for transfer, together with, in the case of Sonera ADSs evidenced by Sonera ADR certificates, a properly completed and duly executed letter of transmittal (or a copy thereof), together with any required signature guarantees or, in the case of Sonera ADSs held through a book-entry transfer facility, a book-entry confirmation along with an agent’s message and any other required documents, are received by the U.S. exchange agent within three NASDAQ trading days after the date of execution of the notice of guaranteed delivery. A NASDAQ trading day is a day on which NASDAQ is open for business.

      Any notice of guaranteed delivery may be delivered by hand, by courier or mail to the U.S. exchange agent and must include a guarantee by an eligible institution in the form set forth in the notice of guaranteed delivery. In the case of Sonera ADSs held through the book-entry transfer system of DTC, the notice of guaranteed delivery must be delivered to the U.S. exchange agent by a DTC participant by means of the DTC book-entry transfer confirmation system.

      If you are a holder of Sonera shares located outside Finland and the United States, please see “— Restrictions on Ability of Certain Persons to Participate in the Mandatory Redemption Offer” above.

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Holders of Sonera Warrants

      If you are a holder of Sonera warrants who is directly registered in the register of warrantholders held by the Finnish Central Securities Depository on or about December 27, 2002, you will receive an acceptance form with tender instructions from the book-entry account operator managing the book-entry account where your Sonera warrants are registered, unless otherwise agreed with the account operator. The acceptance forms are also available from your book-entry account operator.

      Warrantholders who have their Sonera warrants registered with FCSD can accept the mandatory redemption offer at any asset management branch of the Finnish share agent.

      If your Sonera warrants are registered in the name of a nominee (or other custodial institution) and you wish to accept the mandatory redemption offer, you have to make such acceptance in accordance with such nominee’s instructions. TeliaSonera will not send you any documents relating to the mandatory redemption offer directly.

      If your Sonera warrants have been pledged, the consent of the appropriate pledgee is required for acceptance of the mandatory redemption offer and it is your responsibility to obtain such consent.

      If you wish to accept the mandatory redemption offer, you have to complete, sign and return the acceptance form to your account operator in accordance with such account operator’s instructions or to any asset management branch of the Finnish share agent on or before 4:00 p.m. Helsinki time on January 31, 2003 or, if the mandatory redemption offer period has been extended, before the expiry of the mandatory redemption offer period as extended. Your book-entry account operator may ask you to return your acceptance form at an earlier date. Do not send your acceptance form directly to TeliaSonera or Sonera.

      You may accept the mandatory redemption offer only in relation to all of your Sonera 1999A warrants, Sonera 1999B warrants, Sonera 2000A1 warrants, Sonera 2000A2 warrants, Sonera 2000A3 warrants or Sonera 2000A4 warrants. If you hold both Sonera shares and Sonera warrants, or Sonera warrants of more than one series, you are not obligated to tender all of your Sonera securities but may elect instead to tender only your Sonera shares or your Sonera warrants of a particular series. Except as provided in the foregoing sentence, any partial tender of Sonera warrants of a particular series may be rejected as a non-acceptance of the mandatory redemption offer. By tendering your Sonera 2000A warrants of a certain series, you are also deemed to tender your Sonera 2000B and 2000C warrants attached to your Sonera 2000A warrants of that series. You may elect to receive cash as consideration in relation to certain series of Sonera warrants and TeliaSonera warrants in relation to other series. You may not elect to receive both cash and TeliaSonera warrants for tendered warrants of a particular series.

      By accepting the mandatory redemption offer, you authorize Nordea Bank Finland Plc or your account operator to effect the transfer of your Sonera warrants to TeliaSonera in exchange for either TeliaSonera warrants or cash, as the case may be, including necessary registrations in the book-entry accounts, and to transfer the title of tendered warrants to TeliaSonera.

      If you elect to receive TeliaSonera warrants in exchange for your Sonera warrants, following receipt of a duly completed acceptance form by your account operator or any asset management branch of the Finnish share agent, each Sonera 1999A warrant will be converted into one Sonera 1999A exchanged warrant, each Sonera 1999B warrant will be converted into one Sonera 1999B exchanged warrant, each Sonera 2000A1 warrant will be converted into one Sonera 2000A1 exchanged warrant, each Sonera 2000A2 warrant will be converted into one Sonera 2000A2 exchanged warrant, each Sonera 2000A3 warrant will be converted into one Sonera 2000A3 exchanged warrant and each Sonera 2000A4 warrant will be converted into one Sonera 2000A4 exchanged warrant. Each Sonera 2000A exchanged warrant represents one Sonera 2000A warrant, one Sonera 2000B warrant and two Sonera 2000C warrants. The Sonera exchanged warrants will be registered on your book-entry account. You must allow five business days for the registration of the acceptance before the Sonera exchanged warrants are entered into your book-entry account. You may not transfer any of your Sonera exchanged warrants and none of the Sonera exchanged warrants will be eligible for trading on the Helsinki Exchanges. A transfer restriction in respect of the exchanged warrants will be registered in the book-entry system. During the mandatory redemption offer period and until the completion

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      In connection with the completion of the mandatory redemption offer, Sonera exchanged warrants will be converted into TeliaSonera warrants in the book-entry system as follows:

	•	each Sonera 1999A exchanged warrant will be converted into one TeliaSonera warrant 2002/2005:A;
	•	each Sonera 1999B exchanged warrant will be converted into one TeliaSonera warrant 2002/2005:B;
	•	each Sonera 2000A1 exchanged warrant will be converted into one TeliaSonera warrant 2002/2008:A, one TeliaSonera warrant 2002/2008:B and two TeliaSonera warrants 2002/2008:C;
	•	each Sonera 2000A2 exchanged warrant will be converted into one TeliaSonera warrant 2002/2008:D, one TeliaSonera warrant 2002/2008:E and two TeliaSonera warrants 2002/2008:F;
	•	each Sonera 2000A3 exchanged warrant will be converted into one TeliaSonera warrant 2002/2010:A, one TeliaSonera warrant 2002/2010:B and two TeliaSonera warrants 2002/2010:C; and
	•	each Sonera 2000A4 exchanged warrant will be converted into one TeliaSonera warrant 2002/2010:D, one TeliaSonera warrant 2002/2010:E and two TeliaSonera warrants 2002/2010:F.

      The method of delivery of acceptance forms and all other required documents is at your option and risk, and the delivery will be deemed made only when actually received by your book-entry account operator or an asset management branch of the Finnish share agent. In all cases, you should follow the instructions sent to you by your book-entry account operator and allow sufficient time to ensure timely delivery.

      If you are a holder of Sonera warrants located outside Finland and the United States, please see “— Restrictions on Ability of Certain Persons to Participate in the Mandatory Redemption Offer” above.

Withdrawal Rights

Withdrawal of Tendered Sonera Shares and Sonera Warrants

      Sonera securities tendered in the mandatory redemption offer in exchange for TeliaSonera securities, including the Sonera exchanged shares and Sonera exchanged warrants, may be withdrawn at any time prior to the applicable expiration of the mandatory redemption offer period.

      Holders of Sonera securities who elect to receive cash as consideration for the Sonera securities they tender in the mandatory redemption offer will not have withdrawal rights.

      For your withdrawal to be effective, you must follow the procedures described below and the instructions sent to you by your book-entry account operator, including:

	•	in the event that you are a holder of Sonera exchanged shares or Sonera exchanged warrants who is directly registered in the shareholders’ register or the register of warrantholders held by the Finnish Central Securities Depository, you must submit a written notice of withdrawal to your book-entry account operator, for arrival prior to the applicable expiration date and time of the mandatory redemption offer; and
	•	in the event that you are a holder of Sonera exchanged shares or Sonera exchanged warrants that are registered in the name of a nominee (or other custodial institution), you must instruct such nominee (or other custodial institution) to submit a written notice of withdrawal to the book-entry account operator of your nominee, for arrival prior to the applicable expiration date and time of the mandatory redemption offer.

      The written notice of withdrawal must be submitted to the book-entry account operator to which the original acceptance form was delivered. Account details for the redelivery of the tendered securities must be included in the notice of withdrawal.

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      Your book-entry account operator is entitled to charge a fee for withdrawals as agreed between you and your account operator.

      After the expiration of the mandatory redemption offer period, holders who tendered their Sonera securities will have no withdrawal rights.

Withdrawal of Tendered Sonera ADSs

      If you tendered your Sonera ADSs in exchange for Telia Sonera ADSs to the U.S. exchange agent by means of delivery of a letter of transmittal together with the Sonera ADR certificate evidencing your Sonera ADSs, you may withdraw your tender by delivering to the U.S. exchange agent a properly completed and duly executed notice of withdrawal, guaranteed by an eligible guarantor institution (unless the notice of withdrawal related to a tender made for the account of an eligible guarantor institution), prior to the expiration of the mandatory redemption offer period in the United States.

      If you tendered your Sonera ADSs in exchange for Telia Sonera ADSs by means of the book-entry confirmation procedures of DTC, you may withdraw your tender by instructing your broker, dealer, commercial bank, trust company or other entity to cause the DTC participant through which your Sonera ADSs were tendered to deliver a notice of withdrawal to the U.S. exchange agent by means of an agent’s message transmitted through the book-entry confirmation facilities of DTC, prior to the expiration of the mandatory redemption offer period in the United States.

Other

      Neither Sonera, TeliaSonera, the U.S. exchange agent, the Finnish share agent nor any other person will be under any duty to give notification of any defects or irregularities in any notice of withdrawal nor will any of them incur any liability for failure to give any notification. Any Sonera shares, Sonera ADSs or Sonera warrants properly withdrawn will be deemed not to have been validly tendered for purposes of TeliaSonera’s mandatory redemption offer. However, if you elect to receive TeliaSonera securities in connection with the mandatory redemption offer you may re-tender withdrawn Sonera shares, Sonera ADSs or Sonera warrants by following the applicable procedures discussed above under “— Procedures for Tendering” at any time prior to the applicable expiration of the mandatory redemption offer period.

Validity of the Tender of Securities

      TeliaSonera will determine questions as to the validity, form, eligibility, including time of receipt, and acceptance for exchange of any tender of Sonera shares, Sonera ADSs and Sonera warrants, in its sole discretion and TeliaSonera’s determination shall be final and binding. TeliaSonera reserves the right to reject any and all tenders of Sonera shares, Sonera ADSs and Sonera warrants that it determines are not in proper form or the acceptance of or exchange for which may be unlawful. No tender of Sonera shares, Sonera ADSs or Sonera warrants will be deemed to have been validly made until all defects and irregularities in tenders of Sonera securities have been cured or waived. Neither TeliaSonera, the U.S. exchange agent, the Finnish share agent nor any other person will be under any duty to give notification of any defects or irregularities in the tender of any Sonera shares, Sonera ADSs or Sonera warrants or will any of them incur any liability for failure to give any such notification. TeliaSonera’s interpretation of the terms and conditions of the mandatory redemption offer, including the acceptance forms and instructions thereto, will be final and binding.

      If you send in an otherwise complete acceptance form, letter of transmittal or electronic message but fail to make a valid election as to the consideration you wish to receive in the mandatory redemption offer, you will be deemed, unless you have otherwise agreed with your account operator or unless your account operator has different procedures for the processing of acceptances, to have elected to receive TeliaSonera shares, TeliaSonera ADSs or TeliaSonera warrants, as the case may be, in exchange for your validly tendered Sonera securities.

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Announcement of the Results of the Mandatory Redemption Offer

      TeliaSonera will make the results of the mandatory redemption offer public by an announcement to be issued on or about four business days after the expiration of the mandatory redemption offer period. The announcement will be made by means of a press release which will also be posted on TeliaSonera’s website at www.telia.com.

Acceptance of Sonera Securities, Terms of Payment and Delivery of TeliaSonera Securities

Cash Consideration

      If you elect to receive cash consideration in the mandatory redemption offer for your tendered Sonera securities:

	•	TeliaSonera will pay for all Sonera securities that have been validly tendered in the mandatory redemption offer for cash as promptly as practicable after the receipt of acceptance relating to such securities.
	•	The payment of the cash consideration will be made:

	•	in the case of a tendering Sonera shareholder or Sonera warrantholder, into the bank account related to the book-entry account of such tendering Sonera securityholder on or about five business days after the execution of the sale of the tendered Sonera securities to TeliaSonera on or outside the Helsinki Exchanges. Such sale will be executed within five business days after the receipt of acceptance relating to such Sonera securities; and
	•	in the case of a tendering Sonera ADS holder, (a) by book-entry transfer of the applicable amount in U.S. dollars into the DTC account of the DTC participant which tendered the Sonera ADSs on behalf of such holder in the mandatory redemption offer by means of the DTC book-entry confirmation system or (b) by means of a check in U.S. dollars to the order of the tendering Sonera ADS holder as provided in the corresponding letter of transmittal, in either case as promptly as practicable the execution of the sale of the Sonera shares underlying the Sonera ADSs to TeliaSonera on or outside the Helsinki Exchanges.

      Title to Sonera shares and Sonera warrants tendered in the mandatory redemption offer in exchange for cash consideration will transfer to TeliaSonera upon the payment by TeliaSonera of such cash consideration.

      To the extent permitted, the acceptance of Sonera securities for cash consideration in the mandatory redemption offer will be executed as a sale and purchase of such securities on the Helsinki Exchanges.

Security Consideration

      If you elect to receive TeliaSonera securities in the mandatory redemption offer in exchange for your tendered Sonera securities:

	•	TeliaSonera will accept for exchange and will exchange all Sonera securities that have been validly tendered and not withdrawn pursuant to the terms of the mandatory redemption offer at the earliest practicable time following the expiration date of the mandatory redemption offer.
	•	Such TeliaSonera securities will be delivered to you or, in the case of tendered Sonera ADSs, to an account for the benefit of the depositary for TeliaSonera ADSs, at the earliest practicable date after the expiration of the mandatory redemption offer period which, in the case of Sonera shares or Sonera warrants, shall be on or about 11 business days following the expiration date of the mandatory redemption offer.

      Holders of TeliaSonera shares delivered in the mandatory redemption offer will be able to exercise their rights as TeliaSonera shareholders from the date of the registration of the shares in the holders’ securities accounts with the VPC (the Swedish Central Securities Depository) or the FCSD (the Finnish Central Securities Depository), respectively. Holders of TeliaSonera warrants will be able to exercise their rights as

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      Title to Sonera shares and Sonera warrants tendered in the mandatory redemption offer in exchange for TeliaSonera shares and TeliaSonera warrants will transfer to TeliaSonera upon the acceptance by TeliaSonera of the exchange of the Sonera exchanged shares and Sonera exchanged warrants for TeliaSonera shares and TeliaSonera warrants, respectively, in accordance with the above.

      Delivery of TeliaSonera Shares and TeliaSonera Warrants. TeliaSonera shares and TeliaSonera warrants will be delivered to the Finnish book-entry accounts of the holders of the Sonera exchanged shares or Sonera exchanged warrants, through a book-entry link between the Finnish Central Securities Depository and the Swedish Central Securities Depository. See “DESCRIPTION OF SHARES AND SHARE CAPITAL OF TELIA — FCSD Registered Telia Shares and Telia Warrants” in the exchange offer prospectus. For a description of fractional entitlements, see “— Fractional Entitlements to TeliaSonera Shares and TeliaSonera ADSs” below.

      Assuming that there is no extension of the mandatory redemption offer period the TeliaSonera shares and TeliaSonera warrants are expected to be entered into the relevant book-entry accounts on or about February 17, 2003.

      Delivery of TeliaSonera ADSs. Subject to the terms and conditions of the mandatory redemption offer, upon TeliaSonera’s acceptance of Sonera ADSs tendered in the mandatory redemption offer and confirmation from the TeliaSonera depositary of TeliaSonera’s deposit of the applicable number of TeliaSonera shares to be represented by the TeliaSonera ADSs to be issued in the mandatory redemption offer, the U.S. exchange agent will deliver the applicable whole number of TeliaSonera ADSs, together with any cash in respect of fractional entitlements to TeliaSonera ADSs, to the tendering holders of Sonera ADSs in the following manner:

	•	if you tendered your Sonera ADSs to the U.S. exchange agent by means of delivery of a letter of transmittal together with the Sonera ADR certificate(s) evidencing your Sonera ADSs, the U.S. exchange agent will deliver a single TeliaSonera ADR certificate evidencing the applicable number of TeliaSonera ADSs, together with a check in U.S. dollars for any cash in lieu of fractional entitlements to TeliaSonera ADSs according to the issuance and delivery instructions of the tendering Sonera ADS holder provided in the letter of transmittal; or
	•	if you tendered your Sonera ADSs by means of DTC’s book-entry confirmation system, the U.S. exchange agent will deliver the applicable whole number of TeliaSonera ADSs, together with any cash in lieu of fractional entitlements to TeliaSonera ADSs in U.S. dollars, to the account of the DTC participant who tendered the Sonera ADSs on your behalf in the mandatory redemption offer.

Dividend Payments

      The TeliaSonera shares to be issued in connection with the mandatory redemption offer, including the TeliaSonera shares to be represented by TeliaSonera ADSs, will have the same dividend rights as the other currently outstanding TeliaSonera shares with respect to the fiscal year 2002 and subsequent years.

      The TeliaSonera ADS depositary will deliver any dividends paid upon deposited TeliaSonera shares to the holders of TeliaSonera ADSs in the manner set forth under the TeliaSonera deposit agreement.

      The Swedish Central Securities Depository will transfer any dividend paid by TeliaSonera on the TeliaSonera shares held in Finnish book-entry accounts in a single sum in Swedish kronor to the Finnish Central Securities Depository which in turn is responsible for distributing the dividends to the Finnish book-

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      For a description of Swedish, Finnish and United States federal income tax consequences of dividend payments see “TAXATION” in the exchange offer prospectus.

Fractional Entitlements to TeliaSonera Shares and TeliaSonera ADSs

      Fractional entitlements to TeliaSonera shares or fractional entitlements to TeliaSonera ADSs will not be delivered to holders of Sonera securities validly tendered in the mandatory redemption offer. To the extent that holders of Sonera securities are entitled to receive fractions of TeliaSonera shares or fractions of TeliaSonera ADSs in exchange for their Sonera securities, those fractional entitlements will be combined with the other holders’ fractional entitlements and subsequently sold on behalf of such holders on the Stockholm Exchange or the Helsinki Exchanges, in the case of TeliaSonera shares or, on NASDAQ, in the case of TeliaSonera ADSs. Each such holder of Sonera securities who would not upon application of the applicable exchange ratio receive full consideration in the form of TeliaSonera shares or TeliaSonera ADSs will receive the maximum whole number of TeliaSonera shares or TeliaSonera ADSs, as applicable, together with cash consideration corresponding to the fraction of the price of the TeliaSonera share or TeliaSonera ADS, which price shall be based on the average net sale price (after deduction of related fees and expenses, excluding any commission) of all the shares, in the case of shareholders, and of all the ADSs, in the case of ADS holders, combined from the fractional entitlements and sold on behalf of those tendering holders.

      By the acceptance of the mandatory redemption offer, the tendering Sonera shareholder, or tendering holder of Sonera ADSs, authorizes Nordea Bank Finland Plc, in the case of fractional entitlements to TeliaSonera shares, or the U.S. exchange agent, in the case of fractional entitlements to TeliaSonera ADSs, to combine such holders’ fractional entitlements to a TeliaSonera share or TeliaSonera ADS with other such fractional entitlements and sell them on the Stockholm Exchange or the Helsinki Exchanges, in the case of TeliaSonera shares, or on NASDAQ, in the case of TeliaSonera ADSs. The sales are intended to take place promptly after delivery of the TeliaSonera securities following the expiration of the mandatory redemption offer period.

      The payment of the consideration for the fractional entitlements will be made, in the case of a tendering Sonera shareholder, into the bank account related to the book-entry account of the tendering Sonera shareholders entitled to fractional entitlements and, in the case of a tendering Sonera ADS holder, (a) by book-entry transfer of the applicable amount in U.S. dollars into the DTC account of the DTC participant which tendered the Sonera ADSs on behalf of such holder in the mandatory redemption offer by means of the DTC book-entry confirmation system or (b) by means of a check in U.S. dollars to the order of the tendering Sonera ADS holder as provided in the corresponding letter of transmittal, within ten business days after the sale of the combined fractional entitlements on the Stockholm Exchange or the Helsinki Exchanges or on NASDAQ, as the case may be.

      No commissions will be charged to the holders for the sale of fractional entitlements.

Costs and Finnish Transfer Taxes

      If a holder of Sonera shares or Sonera warrants is directly registered in the shareholders’ or warrantholders’ register held by the Finnish Central Securities Depository, such holder will not have to pay any duties and fees in Finland relating to book-entry registrations in connection with his or her acceptance of the mandatory redemption offer or either the receipt of cash consideration or the conversion of Sonera shares into TeliaSonera shares or Sonera warrants into TeliaSonera warrants. The book-entry account operator may charge a fee for other services in connection with the mandatory redemption offer as agreed between the securityholder and the account operator. If a holder has Sonera shares or Sonera warrants registered in the name of a nominee (or other custodial institution) such nominee may charge such holder for tendering Sonera shares or Sonera warrants on such holder’s behalf.

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      TeliaSonera has been informed that, at present, TeliaSonera securities registered with the Finnish Central Securities Depository will be treated in the same way as securities of a domestic issuer for purposes of custody fees.

      TeliaSonera shall be responsible for the payment of Finnish transfer taxes, if any, levied on the exchange of Sonera securities as well as fees relating to the registrations of Sonera exchanged securities and TeliaSonera securities in the Finnish book-entry system in connection with the mandatory redemption offer.

Compulsory Acquisition

      Under the Finnish Companies Act, as a result of its acquisition of more than nine-tenths of all Sonera shares and more than nine-tenths of the total votes attaching to Sonera shares in connection with the exchange offer, TeliaSonera has the right to redeem the remaining Sonera shares of the minority shareholders of Sonera, whether in the form of shares or ADSs, for a “fair price” in a compulsory acquisition proceeding. On December 9, 2002, TeliaSonera notified Sonera of its redemption claim under the compulsory acquisition procedure for all the remaining shares of Sonera, including shares in the form of ADSs, not held by TeliaSonera. TeliaSonera announced that it will redeem the remaining Sonera shares in the compulsory acquisition proceeding for €5.00 per share. The redemption price announced by TeliaSonera in the compulsory acquisition proceeding is the same as the cash consideration for each Sonera share offered by TeliaSonera in the mandatory redemption offer. TeliaSonera has also notified Sonera that it will, without further delay, initiate arbitration proceedings in accordance with the compulsory acquisition procedures under the Finnish Companies Act in order to redeem all of the remaining Sonera shares.

      Any disputes concerning the right of redemption or the redemption price in a compulsory acquisition would be resolved by an arbitral tribunal of one or more arbitrators appointed by the Finnish Central Chamber of Commerce in accordance with the Finnish Companies Act. The District Court of Helsinki has appointed a trustee to look after the interests of holders of Sonera shares, including shares represented by ADSs, which are not able to attend the redemption proceedings. Under the Finnish Companies Act, the arbitration tribunal so appointed has considerable latitude in deciding upon the method or methods used in determining the “fair price” of the shares of the target company and in establishing the final amount of such “fair price” inasmuch as the Finnish Companies Act does not contain any similar provisions to those included in the Finnish Securities Market Act and used in the determination of the “fair price” in connection with a mandatory redemption offer pursuant to the Finnish Securities Market Act, as described in more detail above. Therefore, no assurance can be given as to the amount of the cash redemption price to be paid in connection with a compulsory acquisition following the completion of the mandatory redemption offer and such amount could be more or less than the amount of share consideration per Sonera share and more than the amount of cash consideration per Sonera share received in connection with the mandatory redemption offer. Under the Finnish Companies Act, the shareholders of a target company and the trustee have the right to appeal the decision of the arbitral tribunal in respect of the right of redemption and the cash redemption price to be paid in connection with a compulsory acquisition. Any such appeal is to be launched, in the first instance, with the local district court in the domicile of the target company, with the decision of such local district court being subject to further appeal to the relevant Court of Appeals in Finland and, in the event that permission is granted, to the Finnish Supreme Court. Therefore, the final determination of such cash redemption price for shareholders electing to appeal such price could be subject to protracted litigation.

      The date fixed for the termination of the deposit agreement governing the terms of the Sonera ADSs is January 31, 2003. Under the terms of the Sonera deposit agreement, holders of outstanding Sonera ADSs have the right to surrender their Sonera ADSs to the depositary for the Sonera ADSs and withdraw the deposited Sonera shares represented thereby for a period of six months following the date of termination. Under the terms of the compulsory acquisition, TeliaSonera will acquire title to all Sonera shares, including Sonera shares represented by Sonera ADSs. Notwithstanding the terms of the Sonera deposit agreement, holders of Sonera ADSs wishing to dispute the right of redemption or the redemption price in the compulsory acquisition must surrender their Sonera ADSs to the Sonera ADS depositary and withdraw the Sonera shares represented thereby and have such shares registered in their name in the shareholders’

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      Under the terms of Sonera’s stock option programs, in connection with a compulsory acquisition, holders of Sonera warrants shall be given an opportunity to exercise the Sonera warrants to subscribe for shares within a specified period of time and otherwise in accordance with the terms of the option programs. In addition, under the terms of Sonera’s 2000 stock option program, in connection with a mandatory redemption offer, holders of Sonera warrants issued pursuant to such program shall be given an opportunity to exercise such Sonera warrants within a specified period of time and otherwise in accordance with the terms of Sonera’s 2000 stock option program and to sell all or a part of their respective warrants to TeliaSonera, Sonera or to another party appointed by Sonera at the price defined in the terms of Sonera’s 2000 stock option program. Holders of such Sonera warrants shall notify TeliaSonera, Sonera or such other party appointed by Sonera of their intention to sell such Sonera warrants within two months after the obligation to make a mandatory redemption offer was made public.

Trading in Sonera Securities During the Mandatory Redemption Offer Period and After the Expiration of the Mandatory Redemption Offer Period

      Sonera shares and Sonera 1999A warrants not tendered in the mandatory redemption offer will continue to trade on the Helsinki Exchanges. The trading in Sonera shares and Sonera 1999A warrants will continue on the Helsinki Exchanges after the completion of the mandatory redemption offer in case all such shares and warrants are not tendered in the mandatory redemption offer. See “— Delisting of Sonera Securities.”

Financing of the Mandatory Redemption Offer

      To the extent Sonera securityholders elect to receive cash consideration for their Sonera securities in the mandatory redemption offer, such cash consideration will be financed through existing cash reserves and credit facilities of TeliaSonera.

      To the extent the holders of Sonera shares, including holders of Sonera ADSs, elect to receive TeliaSonera shares or TeliaSonera ADSs, respectively, in exchange for their Sonera shares in the mandatory redemption offer, TeliaSonera will issue new TeliaSonera shares, including shares to be represented by ADSs in consideration for the Sonera shares and Sonera ADSs tendered in the mandatory redemption offer. TeliaSonera has, in connection with the exchange offer, issued TeliaSonera warrants which, to the extent holders of Sonera warrants elect to receive TeliaSonera warrants in the mandatory redemption offer, will be used as consideration for the Sonera warrants tendered in the mandatory redemption offer.

      The financing of the mandatory redemption offer and the issue of new TeliaSonera shares, including shares to be represented by ADSs, are not expected to affect the operations or liabilities of Sonera.

Listing of TeliaSonera Shares, TeliaSonera ADSs and TeliaSonera Warrants 2002/2005:A

      TeliaSonera shares are listed on the A-list of the Stockholm Exchange and on the main list of the Helsinki Exchanges; TeliaSonera warrants 2002/2005:A are listed on the main list of the Helsinki Exchanges; and TeliaSonera ADSs are quoted for trading on NASDAQ.

Delisting of Sonera Securities

      Sonera will seek to delist its shares and warrants from the Helsinki Exchanges as soon as practicable under applicable rules and regulations. Sonera ADSs were delisted from NASDAQ on December 6, 2002.

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Ownership of Sonera in TeliaSonera

      To the best knowledge of TeliaSonera, Sonera does not own any TeliaSonera securities.

Fees and Expenses

      The expenses to be incurred in connection with the mandatory redemption offer are included in the estimated €135 million in expenses incurred or to be incurred in connection with the merger of Telia and Sonera. See “THE EXCHANGE OFFER — Other Fees and Expenses” in the exchange offer prospectus for a description of the fees and expenses incurred or to be incurred in connection with the merger of Telia and Sonera.

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TAXATION

      The following description is based on the tax laws of Finland, Sweden and the United States and the relevant tax treaties between these countries as in effect on the date of this prospectus supplement and is subject to changes in Finnish, Swedish and U.S. law or the above mentioned treaties, possibly with retroactive effect. This description addresses only the Finnish, Swedish and United States federal income tax considerations of holders of Sonera shares, Sonera ADSs or Sonera warrants who elect to receive cash in connection with the mandatory redemption offer. For a description of the Finnish, Swedish and United States federal income tax consequences of holders of Sonera shares, Sonera ADSs or Sonera warrants who elect to receive TeliaSonera shares, TeliaSonera ADSs or TeliaSonera warrants as consideration in connection with the mandatory redemption offer, please refer to the exchange offer prospectus under the caption “TAXATION.” The tax treatment of each holder of shares, ADSs or warrants depends in part upon such holder’s particular situation. You should consult a professional advisor as to the tax consequences of the mandatory redemption offer and the effect of tax laws of any other jurisdiction. Holders of shares, ADSs and warrants who are tax residents outside of Finland and the United States are urged to consult their own tax advisor as to the consequences resulting from the mandatory redemption offer.

      The description below is not intended to constitute a complete analysis of all tax consequences relating to the mandatory redemption and the compulsory acquisition. You should consult your own tax advisor concerning the tax consequences of your particular situation.

Finnish Tax Considerations

      Under Finnish tax law, tendering Sonera securities in the mandatory redemption offer for cash consideration is considered to be a sale of such securities for tax purposes.

      Any capital gains arising from the sale of securities by Finnish resident individuals and estates are taxed as capital income. Any gain or loss is calculated as the sales price less the original acquisition costs and the selling expenses. Alternatively, in lieu of applying the actual acquisition costs, individuals and estates may choose to apply a presumptive acquisition cost equal to 20 percent of the sales price, or, if the securities sold have been held for a minimum of ten years, 50 percent of the sales price. If the presumptive acquisition cost is used instead of the actual acquisition cost, any selling expenses are deemed to be included therein and may, therefore, not be deducted in addition to the presumptive acquisition cost.

      Finnish residents must report any sales of securities made during the tax year on their tax return. Capital gains of individuals and estates are currently taxed at a flat rate of 29 percent. For individuals and estates, capital losses are primarily deductible from capital gains arising in the same year and the following three years.

      Revenues arising from the sale of shares by Finnish resident companies are counted as part of gross income, while the acquisition cost of the shares is deductible in the taxation of the relevant company. The applicable corporate tax rate is currently 29 percent.

      Non-residents who are not generally liable for tax in Finland will normally not be subject to Finnish taxes on capital gains realized in the transfer of shares of a Finnish company, except when more than 50 percent of the total assets of the company in question consists of real estate located in Finland or unless the capital gains realized in the transfer of shares relate to business carried on in Finland by a foreign seller. In such case, the foreign seller is regarded to have a permanent establishment in Finland for income tax purposes.

      Under the Finnish Income Tax Act, any benefit derived from employee stock warrants is taxed as employment income at the time when the employee stock warrants are exercised. The exercise of employee stock warrants is deemed to take place when the shares are subscribed for pursuant to the warrants or when the warrants are disposed of or when they are redeemed. Taxable employment income will be calculated using the fair market value of the shares at the exercise date or the cash consideration received pursuant to the mandatory redemption offer less the price paid for the shares and/or warrants. Hence the amounts received for employee stock warrants in the mandatory redemption offer, as reduced by the acquisition cost of

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Swedish Tax Considerations

      The following applies to holders of Sonera shares, Sonera ADSs and Sonera warrants who are non-residents of Sweden for tax purposes. This summary is not applicable if the Sonera shares, Sonera ADSs or Sonera warrants pertain to a permanent establishment or fixed place of business in Sweden. In particular, employees who tender their Sonera warrants are urged to consult a tax advisor.

      Under Swedish tax law, the tender of Sonera securities in the mandatory redemption offer for cash consideration is considered to be a sale of such securities for tax purposes. However, the cash consideration election with respect to the mandatory redemption offer can generally be made by holders of shares, ADSs or warrants not resident in Sweden for tax purposes without any Swedish tax consequences. A corporation not domiciled in Sweden may, however, be liable for Swedish capital gains taxation if the corporation has a permanent establishment in Sweden to which the securities are effectively connected.

United States Federal Income Tax Considerations

      The following is a description of the material U.S. federal income tax consequences that may be relevant with respect to the mandatory redemption offer and the compulsory acquisition. This description addresses only the U.S. federal income tax considerations of holders who hold Sonera shares, Sonera ADSs or Sonera warrants as capital assets and who elect to receive cash in connection with the mandatory redemption offer or who receive cash pursuant to the compulsory acquisition. For a description of the U.S. federal income tax consequences of holders of Sonera shares, Sonera ADSs or Sonera warrants who elect to receive TeliaSonera shares, TeliaSonera ADSs or TeliaSonera warrants as consideration in connection with the mandatory redemption offer, please refer to the exchange offer prospectus under the caption “TAXATION — United States Federal Income Tax Considerations.” Except as set forth below, this description does not address tax considerations applicable to holders that may be subject to special tax rules, including:

	•	banks, financial institutions or insurance companies;
	•	real estate investment trusts, regulated investment companies or grantor trusts;
	•	dealers or traders in securities or currencies;
	•	tax-exempt entities;
	•	persons that received Sonera shares, Sonera ADSs or Sonera warrants as compensation for the performance of services;
	•	persons that held Sonera shares, Sonera ADSs or Sonera warrants as part of a “hedging” or “conversion” transaction or as a position in a “straddle” for United States federal income tax purposes; or
	•	persons that have a “functional currency” other than the U.S. dollar.

This description is based

	•	on the Internal Revenue Code of 1986, as amended (the “Code”), existing, proposed and temporary U.S. Treasury Regulations and judicial and administrative interpretations thereof, in each case as in effect and available on the date hereof; and
	•	in part, on the representations of the depositary and the assumption that each obligation in the deposit agreement and any related agreement will be performed in accordance with its terms.

      All of the foregoing are subject to change, which change could apply retroactively and could affect the tax consequences described below.

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      For purposes of this description, a “U.S. Holder” is a beneficial owner of Sonera shares, Sonera ADSs or Sonera warrants that, for U.S. federal income tax purposes, is:

	•	a citizen or resident of the United States;
	•	a partnership or corporation created or organized in or under the laws of the United States or any state thereof, including the District of Columbia;
	•	an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or
	•	a trust, if such trust validly elects to be treated as a U.S. person for U.S. federal income tax purposes or if (1) a court within the United States is able to exercise primary supervision over its administration and (2) one or more U.S. persons have the authority to control all of the substantial decisions of such trust.

      A “Non-U.S. Holder” is a beneficial owner of Sonera shares, Sonera ADSs or Sonera warrants that is not a U.S. Holder.

      If a partnership (or any other entity treated as a partnership for U.S. federal income tax purposes) holds Sonera shares, Sonera ADSs or Sonera warrants, the tax treatment of the partnership or a partner in such partnership generally will depend upon the status of the partner and the activities of the partnership. A partnership or a partner in a partnership that holds Sonera shares, Sonera ADSs or Sonera warrants should consult its own tax advisor.

      You should consult your own tax advisor with respect to the U.S. federal, state, local and foreign tax consequences of the mandatory redemption offer and the compulsory acquisition.

The Mandatory Redemption and Compulsory Acquisition

      The receipt by a U.S. Holder of cash for Sonera shares, Sonera ADSs or Sonera warrants tendered pursuant to the mandatory redemption offer or compulsory acquisition will be a taxable transaction for United States federal income tax purposes and may also be a taxable transaction under applicable state, local or foreign tax laws.

      If you are a U.S. Holder, you generally will recognize gain or loss for United States federal income tax purposes equal to the difference, if any, between the amount realized from the sale of Sonera shares, Sonera ADSs or Sonera warrants and your adjusted tax basis in such Sonera shares, Sonera ADSs or Sonera warrants. Such gain or loss will be capital gain or loss. If you are a non-corporate U.S. Holder, the maximum marginal United States federal income tax rate applicable to such gain will be lower than the maximum marginal United States federal income tax rate applicable to ordinary income if your holding period for such Sonera shares, Sonera ADSs or Sonera warrants exceeds one year.

      Subject to the discussion below under “Backup Withholding Tax and Information Reporting Requirements,” if you are a Non-U.S. Holder, you generally will not be subject to U.S. federal income tax on any gain realized in connection with the mandatory redemption or the compulsory acquisition unless

	•	such gain is effectively connected with your conduct or trade or business in the United States or
	•	if you are an individual, you are present in the United States for 183 days or more in the taxable year such gain is realized and certain other conditions are met.

Backup Withholding Tax and Information Reporting Requirements

      U.S. backup withholding tax and information reporting requirements generally apply to certain payments to certain non-corporate U.S. holders of stock. Information reporting generally will apply to payments of proceeds from the sale or exchange of Sonera shares, Sonera ADSs or Sonera warrants made within the United States to a holder of Sonera shares, Sonera ADSs or Sonera warrants, other than an exempt recipient, including a corporation, a payee that is not a U.S. person that provides an appropriate certification and certain other persons. A payor will be required to withhold backup withholding tax from any proceeds from the sale

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      In the case of such payments made within the United States to a foreign simple trust, a foreign grantor trust or a foreign partnership, other than payments to a foreign simple trust, a foreign grantor trust or a foreign partnership that qualifies as a ”withholding foreign trust” or a ”withholding foreign partnership” within the meaning of the applicable U.S. Treasury Regulations and payments to a foreign simple trust, a foreign grantor trust or a foreign partnership that are effectively connected with the conduct of a trade or business in the United States, the beneficiaries of the foreign simple trust, the persons treated as the owners of the foreign grantor trust or the partners of the foreign partnership, as the case may be, will be required to provide the certification discussed above in order to establish an exemption from backup withholding tax and information reporting requirements. Moreover, a payor may rely on a certification provided by a payee that is not a U.S. person only if such payor does not have actual knowledge or a reason to know that any information or certification stated in such certificate is incorrect.

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ENFORCEMENT OF CIVIL LIABILITIES

      TeliaSonera is a public company incorporated under the laws of the Kingdom of Sweden. All of TeliaSonera’s directors and executive officers live outside the United States. All or a substantial portion of TeliaSonera’s assets, and of the assets of these individuals, are located outside the United States. As a result, it may not be possible for you to effect service of process within the United States upon these individuals or TeliaSonera, or to enforce against them judgments obtained in the United States. TeliaSonera has been advised by its Swedish counsel, Mannheimer Swartling Advokatbyra, that as a general rule judgments of U.S. courts in civil and commercial matters are not directly enforceable in Sweden. Also, the enforcement of civil liabilities based solely on U.S. securities law by original action before a Swedish court may encounter difficulties. However, foreign arbitral awards are as a general rule enforceable in Sweden, although awards of punitive damages may be unenforceable regardless from which judicial body or jurisdiction they originate.

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ANNEX A

ARTICLES OF ASSOCIATION OF TELIASONERA AKTIEBOLAG

§ 1 Name

      The Company’s name is TeliaSonera Aktiebolag.

      The Company is a public limited company (plc).

§ 2 Domicile

      The Board of Directors shall have its registered office in Stockholm.

§ 3 Objects

      The Company’s objects are to offer, directly or indirectly, in a broad sense, telecommunications services and thereto associated information services, as well as to conduct other activities which are compatible with such services.

§ 4 Share capital

      The share capital shall amount to no less than SEK 8 billion and no more than SEK 32 billion.

§ 5 Nominal value of shares

      The shares shall have a nominal value of SEK 3.20 each.

§ 6 Board of Directors

      The Board of Directors shall consist of, besides persons who may be appointed under other rules as a consequence of operations of law, no less than four and no more than nine members and no more than three deputy members. The members and deputy members are elected annually at the annual general meeting to serve until the end of the following annual general meeting.

§ 7 Auditors

      No less than two and no more than three auditors and no more than the same number of deputy auditors shall be appointed by the annual general meeting to audit the annual report and financial accounts of the Company as well as the Board of Directors’ and Managing Director’s administration of the Company.

§ 8 Notice of a general meeting

      Notice of a general meeting shall be made in the form of an advertisement placed in the Swedish Official Gazette (Post- och Inrikes Tidningar), Dagens Nyheter and Svenska Dagbladet or, if it is not possible to advertise in any of those just mentioned publications, another Swedish daily newspaper with national coverage.

      Notice of an annual general meeting and notice of any extraordinary general meeting at which resolutions to amend the Company’s Articles of Association will be considered, shall be issued no earlier than six weeks and no later than four weeks prior to the meeting. Notice of any other extraordinary general meeting shall be issued no earlier than six weeks and no later than two weeks prior to the meeting.

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§ 9 General meetings

      In order to be entitled to participate in a general meeting, shareholders must be entered in a transcription of the entire share register in respect of their shareholdings ten days prior to the meeting, and must also notify the Company of their intention to attend the meeting no later than 4 p.m. on the day stated in the notice of the meeting. This day must not be a Sunday, other public holiday, a Saturday, Midsummer Eve, Christmas Eve or New Year’s Eve and must not fall earlier than the fifth working day before the meeting.

      Shareholders may be accompanied at the meeting by one or two persons to assist them, but only if the shareholder notifies the Company of the number of accompanying persons in the manner stated in the previous paragraph.

      The annual general meeting shall transact the following matters:

	1.    Elect a chairman for the general meeting.
	2.    Prepare and approve the voting list.
	3.    Approve the agenda.
	4.    Elect two persons to check the minutes.
	5.    Confirm that the general meeting has been duly summoned.
	6.    Consider the annual accounts and the auditors’ report as well as the consolidated annual accounts and auditors’ report for the group.
	7.    Resolve

	a)    whether to approve the profit and loss account and balance sheet as well as the consolidated profit and loss account and consolidated balance sheet,
	b)    how the Company’s profit or loss according to the approved balance sheet is to be appropriated,
	c)    whether the members of the Board of Directors and the Managing Director should be discharged from liability for the period covered by the accounts.

	8.    Determine the number of Board members and deputy members, who are to be elected by the meeting.
	9.    Determine the amounts of fees of the Board of Directors.
	10.   Elect the Board of Directors and any deputy members.
	11.   When required, determine the number of auditors and deputy auditors.
	12.   When required, determine the remuneration to the auditors.
	13.   When required, elect the auditors and deputy auditors.
	14.   Consider any other business which is incumbent upon the general meeting under the Swedish Companies Act.

§10 Voting rights

      Each shareholder is at the general meeting entitled to vote for the total number of shares he or she owns or represents.

§11 Financial year

      The Company’s financial year is the calendar year.

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§12 Record day provision

      Any person who, on the record day determined by the Company is entered in the share register or list of shareholders in accordance with Chap. 3 section 12 of the Swedish Companies Act, shall be regarded as authorized to receive dividends and, in the event of a bonus issue, new shares to which existing shareholders are entitled, and also to exercise shareholders’ pre-emption rights to participate in share issues.

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ANNEX B

Interim Report

January-September 2002

      Telia AB (publ), SE-123 86 Farsta, Corp. Reg. No. 556103-4249, Registered office: Stockholm

Q3 in Brief

•	Underlying EBITDA improved 25% to MSEK 4,281 (3,420). Substantially strengthened margin from 24% to 30%
•	Strong free cash flow of MSEK 2,059
•	Restructuring of the Danish fixed network operations affected operating income by MSEK -3,072
•	Costs totaling MSEK 12,089 for restructuring and streamlining efforts, primarily within International Carrier and the Danish fixed network operations, impacted operating income, falling to MSEK -10,815 (2,745)
•	Net sales increased to MSEK 14,496 (14,431). Sales for comparable units increased 5%
•	The prospectus for the merger with Sonera was published on September 30, 2002

Review of Earnings

			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Jan-Dec
MSEK			2002				2001				2002				2001				2001
Net sales				14,496				14,431				42,727				42,226				57,196
Change in net sales (%)				0.5				7.0				1.2				6.8				5.8
Underlying EBITDA				4,281				3,420				11,249				9,782				12,915
Underlying EBITDA margin (%)				29.5				23.7				26.3				23.2				22.6
	Depreciation, amortization and write-downs			-11,057				-2,775				-16,768				-7,690				-13,975
	Items not reflecting underlying business operations			-3,997				-239				-4,801				62				384
	Income from associated companies			-42				2,339				333				2,390				6,136
Operating income				-10,815				2,745				-9,987				4,544				5,460
Income after financial items				-10,964				2,491				-10,507				3,902				4,808
Net income				-10,118				1,900				-9,961				2,441				1,869
Basic and diluted loss/earnings per share (SEK)				-3.37				0.63				-3.32				0.81				0.62
Free cash flow				2,059				-1,527				2,674				-5,913				-6,506
Investments				1,956				5,965				6,646				15,578				20,735
	of which CAPEX			1,783				5,630				5,896				12,864				17,713
Number of employees				16,244				22,509				16,244				22,509				17,149

Comments from Anders Igel, President and CEO of Telia

—	The efficiency programs carried out during the year are beginning to yield positive results. It is gratifying to note that earnings, excluding restructuring costs and write-downs, showed substantial improvement during the quarter. The significant increase in the underlying EBITDA margin combined with reduced investments resulted in a sharp increase in free cash flow.

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—	During the third quarter, we have reviewed operations that did not show satisfactory earnings trends, specifically the international carrier operations, which we previously announced, and the fixed network operations in Denmark. We are now taking action to deal with operations that are a drain on Telia’s earnings. These actions have resulted in substantial costs for restructuring and write-downs, which explains the negative operating income.
—	On September 30, we published the prospectus for the planned merger between Telia and Sonera and merger preparations are fully underway.

Review of the Group

      Underlying EBITDA margin reached 30 percent. Extensive streamlining costs impacted operating income

      Net sales for the Telia Group increased 0.5 percent to MSEK 14,496 during the third quarter. Sales were affected by the extensive divestitures in 2001 as part of the Group’s refinement. Sales for comparable units increased 5 percent.

      Demand remained good in all growth areas. During the third quarter, Mobile’s sales increased 12 percent; Internet Services’ sales increased 30 percent; and International Carrier’s sales increased 17 percent. Within Networks, sales fell 4 percent for comparable units due to the introduction of local carrier preselection in Sweden.

Net Sales and Margins by Quarter (MSEK)

Significantly improved underlying EBITDA

      The program of ongoing efficiency-enhancing measures is starting to yield results. During the third quarter, underlying EBITDA climbed a full 25 percent to MSEK 4,281 and the margin improved from 24 to 30 percent.

      Mobile’s margin increased from 26 to 31 percent; Internet Services improved its earnings 60 percent; and the increase for International Carrier was 58 percent. Weak development in Denmark led to a decreased

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Distribution of Net Sales in Q3

Extensive restructuring and efficiency measures

      The International Carrier business area and operations in Denmark have undergone an extensive review.

      Looking forward, the International Carrier operations will be concentrated to wholesale sales of capacity, IP and voice to large customers on the profitable segments of Telia’s wholly owned network in Europe and across the Atlantic. The expected result of these measures is for the carrier operations to report positive cash flow on a monthly basis in 2003, adjusted for restructuring costs.

      Telia’s Danish mobile and fixed network operations have so far had a negative impact on Telia’s earnings. The cable TV operations, including Internet Cable, have developed well with a positive contribution to EBITDA. Customer growth in the Danish mobile operations was good and the number of customers now totals 449,000. This means that the focus of the cable TV and mobile operations will be sustained.

      The Danish fixed network operations and Internet services, including broadband over ADSL show unsatisfactory development, however, and Telia deems that the current focus will not lead to satisfactory profitability. For this reason, the operations are now being switched to focus on potentially profitable areas and the product range and operating costs will be cut by more than half. The objective is to attain positive underlying EBITDA at the end of 2003. The possibility of reaching this objective however, is greatly dependent on the regulatory developments in Denmark, among other factors.

      To adapt the operations to the new focus and to streamline other operations in the Group, costs totaling MSEK 12,089 were incurred in the third quarter, of which MSEK 3,160 were for restructuring and MSEK 8,929 entailed write-downs.

      Depreciation, amortization, and write-downs in the third quarter totaled MSEK 11,057 (2,775). Write-downs totaled MSEK 8,112 (149) and mainly comprised write-downs of fixed assets in International Carrier and the fixed network operations in Denmark.

      Items not reflecting underlying business operations totaled MSEK -3,997 (MSEK -239) and mainly referred to restructuring costs within International Carrier and the fixed network operations in Denmark, as well as capital gains within Holding. The item also included MSEK 159 from certain pension-related costs.

      Income from associated companies totaled MSEK -42 (2,339). The comparative quarter was affected by capital gains of MSEK 3,034. Not including capital gains, income from associated companies improved by MSEK 645 in the third quarter 2002.

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      As a result of extensive write-downs and restructuring costs, operating income decreased to MSEK -10,815 (2,745) in the third quarter.

      Financial items improved during the quarter to MSEK -149 (-254).

      Income after financial items totaled MSEK -10,964 (2,491).

      After minority stakes and a positive tax effect of MSEK 852 arising from a previously unutilized loss carry-forward, the net income reported for the third quarter was MSEK -10,118 (1,900).

Nine-month period

      During the nine-month period, net sales advanced 1 percent compared with the same period in the preceding year. Sales for comparable units increased 6 percent.

      Underlying EBITDA improved 15 percent to MSEK 11,249 (9,728).

      Depreciation, amortization and write-downs totaled MSEK 16,768 (7,690), of which write-downs totaled MSEK 8,208 (149).

      Items not reflecting underlying business operations totaled MSEK -4,801 (62) and consist of, in addition to restructuring costs and third quarter write-downs within International Carrier and the Danish fixed network operations, streamlining costs within other operations (MSEK 370), certain pension-related costs (MSEK 354), and a capital gain (MSEK 50).

      Income from associated companies totaled MSEK 333 (2,390). Not including capital gains and write-downs, earnings showed an improvement of MSEK 2,151 during the nine-month period.

      Operating income decreased to MSEK -9,987 (4,544).

      Financial items totaled MSEK -520 (-642), resulting in income after financial items totaling MSEK -10,507 (3,902).

      After minority stakes and a positive tax effect of MSEK 544 arising from a previously unutilized loss carry-forward, the net income reported was MSEK -9,961 (2,441).

Strong cash flow, sustained low debt/equity ratio

      The substantial increase in underlying EBITDA and low level of investment generated strong free cash flow (cash flows from operating activities less CAPEX) of MSEK 2,059 in the quarter. This strong cash flow enabled the Group to reduce its net interest-bearing liabilities from MSEK 10,336 to MSEK 8,107 and the low debt/equity ratio was maintained despite significant restructuring provisions and write-downs.

		Sep 30,				Dec 31,				Dec 31,
MSEK		2002				2001				2000
Interest coverage ratio (multiple)			-6.4				3.0				7.3
Change in total assets (%)			-13.3				4.5				60.2
Asset turnover ratio (multiple)			0.48				0.46				0.54
Equity/ assets ratio (%)			45.0				46.2				44.4
Capital employed			74,076				90,971				92,374
Net interest-bearing liability			8,107				10,661				20,235
Debt/equity ratio (multiple)			0.16				0.18				0.37

Reduced investments

      Investments decreased 67 percent to MSEK 1,956 (5,965) in the third quarter due to lower investments in production facilities (CAPEX) in the Swedish fixed network, International Carrier and in the mobile networks.

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      Investments during the nine-month period totaled MSEK 6,646 (15,578), which represents a 57 percent decrease compared with the same period in the preceding year.

Continued staff cuts

      During the nine-month period, the number of Group employees decreased by 905 to 16,244.

Publication of the prospectus for the merger with Sonera

      On September 30, 2002, Telia published the prospectus for the merger with Sonera, along with instructions and terms and conditions for the exchange offer through which the merger will be effected. The exchange offer acceptance period commenced on October 7, 2002 and will end on November 8, 2002. The result of the offer is expected to be published on November 14, 2002.

Extraordinary meeting of shareholders

      In connection with the planned merger with Sonera, an extraordinary meeting of Telia shareholders will be held on Monday, November 4, 2002 at 5:00 pm at Berwaldhallen in Stockholm, Sweden. Notice of the meeting was advertised in the newspapers on October 4.

Changes in Telia’s Management

      Within Telia’s Group Management, Jörgen Latte was appointed as Acting CFO and Head of Corporate Financial Control on September 1, and Eva Lindqvist was appointed as head of the business area International Carrier on September 9. Marie Ehrling will be appointed as head of Telia’s Swedish operations on January 1, 2003. After the planned merger with Sonera, Ehrling will be responsible for the profit center TeliaSonera Sverige.

Review of Business Areas

Mobile — Strong improvement in profitability and continued customer growth

      Mobile has developed positively during the quarter with a continued stream of customers, improved earnings and strengthened margins.

			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep
MSEK			2002				2001				2002				2001
Net sales				5,743				5,247				16,214				14,692
	of which external			5,367				4,786				15,131				13,143
Underlying EBITDA				1,800				1,375				4,391				3,616
EBITDA margin (%)				31.3				26.2				27.1				24.6
	Depreciation, amortization etc.			-1,036				-980				-2,875				-2,499
	Items not reflecting underlying business operations			-38				-33				-386				-47
	Income from associates			81				105				212				224
Operating income				807				467				1,342				1,294
Investments				633				2,100				2,012				3,307
	of which CAPEX			633				1,835				1,761				3,027

      Continued customer growth, increased use of SMS and increased traffic per customer in all Nordic markets contributed to a 12 percent increase in external net sales, to MSEK 5,367 in the third quarter, compared to the corresponding quarter of 2001. The number of customers during the quarter increased by 130,000 to 5,258,000, while the number of customers via service providers fell by 6,000 to 173,000.

      Sales rose 15 percent to MSEK 15,131 for the nine-month period.

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      Volume growth combined with streamlining efforts in all Nordic operations led to a 31 percent improvement in underlying EBITDA, to MSEK 1,800, and the margin was strengthened to 31.3 (26.2) percent during the quarter.

      Depreciation increased to MSEK 1,036 (980).

      Items not reflecting underlying business operations totaled MSEK -38 (-33) and primarily refer to pension provisions in the Swedish operations.

      Income from associated companies, of which the greater part refers to operations in the Baltic states and Russia, fell to MSEK 81 (105). The poorer result is due to the fact that the operations in Russia, after the formation of MegaFon, consist to a large part of start-up operations.

      Operating income increased to MSEK 807 (467). Operating income for the nine-month period increased to MSEK 1,342 (1,294).

      Investments decreased to MSEK 633 (2,100) and were primarily for capacity expansion in the Norwegian, Danish and Swedish networks. The high level of investment in the comparative year is attributable to the acquisition of a 3G license in Denmark (MSEK 1,170).

Continued customer growth and improved profitability in Sweden

      In Sweden, external net sales in mobile telephony rose 4 percent to MSEK 2,820. At the same time, the price level fell 4 percent due to reduced interconnect fees.

      The number of GSM customers during the quarter increased by 57,000 to 3,401,000 and the number of customers via service providers increased by 2,000 to 89,000.

      The average traffic volume per customer and month rose to 135 minutes (131).

      SMS climbed 24 percent and 134 million messages were sent during the quarter.

      Reduced interconnect fees and an increased share of prepaid customers led to a drop in the average revenue per user (ARPU), to SEK 293 (303).

      Churn was 13 percent compared with 11 percent during the second quarter 2002.

      Increased traffic per customer and cost-cutting measures resulted in a 6 percent improvement in underlying EBITDA, to MSEK 1,518, and the margin increased to 48.4 (46.3) percent.

      Telia’s and Tele2’s jointly owned network company, Svenska UMTS-nät AB, signed a loan agreement with a group of banks for SEK 11 billion in loans and credit on current account for the 3G buildout in Sweden. The buildout and financing of the UMTS network in Sweden is proceeding according to plan.

      A GPRS service, Telia GPRS LAN-access, was introduced during the quarter. The service targets businesses with employees who need to access information in the company’s internal systems when they are away from the office.

      Two new subscription types for businesses were also launched: Work for voice services and Executive for voice and data services.

      On October 1, 2002, Telia further reduced its interconnect fee in the GSM network from SEK 0.92 to SEK 0.88 per minute. The price for the HomeRun broadband service was also reduced.

Continued growth and improved earnings in Norway

      In Norway, external net sales in mobile telephony rose 25 percent to MSEK 1,484. The number of customers during the quarter increased by 26,000 to 1,022,000, while the number of customers via service providers fell by 8,000 to 84,000.

      SMS growth remained strong. During the third quarter, 197 million messages were sent, up 47 percent from the same quarter of the preceding year.

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      Simple and attractive customer offers and an increased share of postpaid customers contributed to an increase in the traffic volume per customer per month to 169 (147) minutes and ARPU climbed to NOK 377 (341).

      Underlying EBITDA climbed 48 percent to MSEK 629 and the margin improved to 41.6 percent (35.4). This improvement in earnings is attributable to customer growth, increased traffic volume and streamlining efforts.

Strong sales growth in Denmark

      In Denmark, external sales in mobile telephony rose 62 percent to MSEK 250. The increase was mainly attributable to customer growth. Sales of mobile subscriptions have continued to be successful and the number of customers increased during the quarter by 36,000 to 449,000.

      During the third quarter, a total of 58 million SMS messages were sent, a jump of nearly 300 percent. There was also a slight improvement in traffic volume per user and ARPU.

      Underlying EBITDA improved to MSEK -119 (-128).

      Most of the investments made during the quarter referred to the expansion of the GSM 900 network, which is expected to be completed during the year.

Sales growth and reduced deficit in Finland

      In the Finnish market, external sales for mobile telephony jumped 34 percent to MSEK 235 compared with the same quarter of 2001. The number of customers rose by 12,000 to 247,000. Prepaid customers represented the greater part of this growth.

      SMS increased 29 percent.

      Underlying EBITDA improved to MSEK -34 (-95), partly due to the fact that a greater part of the traffic is now carried in Telia’s own network as a result of the roaming agreement with Suomen 2G.

      Telia has committed to selling its mobile operations in Finland as stipulated by the EU in its approval of the merger with Sonera.

Growth in the Baltic states and Russia

      The associated companies in Russia and the Baltic states continued to show positive development and the total number of customers surged 635,500 to 3,814,000 during the quarter. The customer growth was primarily attributable to the Russian operations.

Business solutions, telephony

      External net sales for telephony in Business Solutions totaled MSEK 408 and underlying EBITDA improved to MSEK -21 (-73).

Reduced losses in other business

      For other operations, which mainly include mobile portals, shops and radio contracting, external net sales fell 17 percent to MSEK 170. The decline is chiefly attributable to retail operations. Reduced costs for the portal business resulted in an improvement in underlying EBITDA to MSEK -158 (-184).

Internet Services — Stronger market position in broadband

      Within Internet Services, external net sales rose 30 percent to MSEK 1,034 during the third quarter compared with the same quarter of 2001. The increase is attributable to continued demand for broadband access, greater demand for TV services and higher prices. The average price level climbed 7 percent during the quarter.

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			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep
MSEK			2002				2001				2002				2001
Net sales				1,046				765				3,057				2,337
	of which external			1,034				797				3,027				2,325
Underlying EBITDA				-92				-229				-406				-747
EBITDA margin (%)				-8.8				-29.9				-13.3				-32.0
	Depreciation, amortization etc.			-124				-108				-493				-281
	Items not reflecting underlying business operations			-19				-15				-116				-24
	Income from associates			-33				-9				-51				-36
Operating income				-268				-361				-1,066				-1,088
Investments				67				129				303				672
	of which CAPEX			68				129				274				605

      Sales for the nine-month period increased 30 percent.

      Telia’s Internet services continued to report weak development. Third quarter sales fell to MSEK 30 (31). This was attributable to weak demand, primarily for content services (portal services) and payment services. The operations also reported weak profitability.

      The range of services is being restructured in order to create a service portfolio with solid long-term growth and sustainable profitability. Telia is also concentrating greater efforts on developing accesses and related value-added services such as VOIP and other types of communications-related services, an area where Telia has high expertise and a strong market position with over 1.2 million Internet access customers.

      The changed focus means that payment services and certain content services are being phased out in Sweden. The hosting services Telia Instant Web and Telia Webbhotell were closed during the quarter. Certain Internet services will also be phased out in Denmark. Systems and platforms related to Internet services were written down by MSEK 12 in the third quarter.

      The sustained strong stream of customers within broadband access, price changes and streamlining efforts improved underlying EBITDA to MSEK -92 (-229) compared with the same quarter of 2001. During the nine-month period underlying EBITDA improved to MSEK -406 (-747).

      Depreciation, amortization and write-downs rose to MSEK 124 (108) and include, write-downs on Internet services systems and platforms totaling MSEK 12.

      Under items not reflecting underlying business operations, MSEK 12 was reported in restructuring costs, including provisions for redundant personnel.

      Income from associated companies totaling MSEK -33 (-9) refer to Marakanda and include a third quarter write-down totaling MSEK 24.

      Operating income improved to MSEK -268 (-361). Operating income for the nine-month period totaled MSEK -1,066 (-1,088).

      Investments decreased to MSEK 67 (129). This decline was attributable to reduced investment needs in the cable TV business, as property owners are now taking over a large part of the network investments.

Internet accesses

      Sales of Internet accesses jumped 45 percent to MSEK 665. During the quarter, the number of ADSL customers increased by 15,000 to 279,000 and the number of customers with Internet Cable increased by 9,000 to 134,000.

      Demand for broadband access was strongest in the business segment where primarily smaller companies choose Internet-based solutions over traditional data communications.

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      During the quarter, Telia strengthened its market position in broadband within the Swedish business segment in which Telia now has 50 percent of the market. At the same time, Telia maintained its 55 percent market share in broadband in the consumer segment.

      During the third quarter, demand for dial-up Internet services also grew after having stagnated somewhat earlier in the year. The number of customers grew by 14,000 during the quarter and is currently on a par with the third quarter of 2001. The sales increase is largely attributable to the launch of Telia Internet för Alla, an access service that was well received, particularly among young customers.

      Several other new product launches were successful during the quarter. For small and medium-size businesses, Telia has developed an IPX that enables companies to integrate IP telephones, analog telephones, fax machines and modems in a single network solution. A new type of fixed Internet access, ProLane Light, was also developed for small and medium-size companies.

      Several major deals were finalized during the quarter. An agreement was signed with SEB for the delivery of a virtual private network. Fixed access solutions (ProLane) were sold to several municipalities.

Cable TV

      Increased sales of cable TV connections, higher payments from property owners in the Swedish market and a price increase for cable TV in Denmark resulted in a 14 percent increase in external net sales in the cable TV business, to MSEK 336. During the quarter, the number of cable TV customers increased 21,000 to 1,591,000. The number of digital TV customers remained largely unchanged, which is in line with the market trend.

      In Sweden, the total number of cable TV customers was 1,403,000 at the end of the period.

      In Denmark, 188,000 customers were connected directly via cable and approximately 440,000 indirectly via parabolic antenna connections.

      The cable TV operations in Sweden, Com Hem, will be divested as stipulated by the EU for its approval of the planned merger with Sonera.

International Carrier — New strategic focus will yield positive cash flow 2003

      Weaker growth in broadband, delayed 3G buildout and insolvency among several carriers resulted in dramatic and turbulent developments in the carrier market with slowed growth, increased risk and lower asset value in the industry. Considering these developments, Telia has decided to change the strategic direction for International Carrier and to restructure the operations. A restructuring provision of MSEK 2,825 was made in the third quarter.

			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep
MSEK			2002				2001				2002				2001
Net sales				1,378				1,283				3,868				3,361
	of which external			1,176				1,003				3,264				2,630
Underlying EBITDA				-255				-614				-873				-1,181
EBITDA margin (%)				-18.5				-47.9				-22.6				-35.1
	Depreciation, amortization etc.			-5,457				-135				-5,868				-305
	Items not reflecting underlying business operations			-3,649				1				-3,650				0
	Income from associates			0				0				0				0
Operating income				-9,361				-748				-10,391				-1,486
Investments				222				1,620				660				3,880
	of which CAPEX			222				1,643				660				3,880

      The changed market conditions also led Telia to write down the book value of the fixed assets by MSEK 6,131 in the third quarter.

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      The measures now being taken are expected to result in a positive cash flow for the carrier operations on a monthly basis during 2003, adjusted for restructuring costs, while Telia retains the possibility to take part of future market growth within IP and broadband.

Concentration on the profitable segments of the network

      Looking forward, the operations will be concentrated to wholesale sales of capacity, IP and voice to large customers on the profitable segments of Telia’s wholly owned network in Europe and across the Atlantic.

      Telia will also offer secure transport of Internet traffic at competitive prices by continuing to operate its IP network and maintain peering points (connection points to other operators’ networks) in Europe and the United States.

Phase-out of unprofitable operations

      The new focus entails a restructuring of the operations. The restructuring will be completed at the end of 2003 and includes the following steps, among others:

	•	Phase-out of operations in Asia
	•	Phase-out of sales of domestic voice through resellers in the United Kingdom
	•	Phase-out of the co-location business
	•	Freezing domestic network services in the United States
	•	Centralizing sales, administration and customer services functions to Sweden.

      The restructuring will greatly reduce the number of offices and technical facilities as well as lead to reduced operation and maintenance costs and leased lines.

      The purpose is to reduce the current staffing of 800 employees by more than half.

      The total cost of the restructuring is estimated at approximately SEK 3.5 billion, for which provisions of MSEK 2,825 were made in the third quarter.

Increased sales in all product areas

      Third-quarter external net sales rose 17 percent, compared with the corresponding period in the preceding year. Sales were good in all three main product areas.

      Capacity and IP sales increased 11 percent and voice sales increased 27 percent. The sales growth is attributable to good order intake, primarily during the second quarter, due to the fact that several competing carriers were forced to exit the market. Order intake tapered off somewhat towards the end of the quarter.

      Sales for the nine-month period increased 24 percent compared with the same period in the preceding year.

Improved underlying EBITDA

      Increased net sales led to further improvement in underlying EBITDA to MSEK -255, compared with MSEK -614 in the third quarter 2001. Compared with the second quarter 2002, the improvement in earnings was MSEK 32.

      Depreciation, amortization and write-downs climbed to MSEK 5,457 (135). The write-down of fixed assets in the third quarter totaled MSEK 6,131, of which MSEK 5,307 burdened the item depreciation, amortization and write-downs and refer to unutilized network sections and technical facilities.

      Items not reflecting underlying business operations totaled MSEK -3,649 (1) and include the provision of MSEK 2,825 for close-downs or partial phase-outs of technical facilities, offices and regeneration and

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      The write-down of fixed assets and the restructuring provision led to decreased operating income totaling MSEK -9,361 (-748). Operating income for the nine-month period totaled MSEK -10,391 (-1,486).

Customer-driven investments

      Investments decreased during the quarter to MSEK 222 (1,620) and primarily referred to equipment for expanding capacity in the wholly owned network due to increased customer demand.

Networks — Continued improvement in earnings in Sweden. Focus-shift in Denmark

      External net sales in Networks fell 8 percent to MSEK 6,615 in the third quarter compared with the third quarter 2001. Sales for comparable units fell 4 percent. This decrease was mainly due to declining revenues in the Swedish retail market.

			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep
MSEK			2002				2001				2002				2001
Net sales				8,093				8,229				24,732				24,742
	of which external			6,615				7,183				20,403				21,472
Underlying EBITDA				2,832				3,129				8,440				8,759
EBITDA margin (%)				35.0				38.0				34.1				35.4
	Depreciation, amortization etc.			-4,307				-1,345				-7,128				-3,877
	Items not reflecting underlying business operations			-378				-99				-641				-58
	Income from associates			-32				-624				74				-3,530
Operating income				-1,885				1,061				745				1,294
Investments				649				1,869				2,709				5,155
	of which CAPEX			649				1,830				2,706				4,692

      Sales for the nine-month period decreased 5 percent. Price levels remained largely unchanged during the period.

      Underlying EBITDA fell to MSEK 2,832 (3,129) during the quarter. The weaker earnings are attributable to losses in the Danish operations. The Danish fixed network operations were reviewed during the quarter in order to value their assets and determine a new focus.

      Looking forward, the operations will be concentrated to the transport capacity offer and voice services for both consumers and business customers. This means that the product range and operating costs will be cut by more than half. In conjunction with the review and the new focus, the value of current assets was written down by MSEK 353, the value of fixed assets was written down by MSEK 2,786, and a provision of MSEK 286 was made for restructuring costs. The action program is expected to entail additional restructuring costs of approximately MSEK 185-250 in the fourth quarter 2002. The objective is to attain positive underlying EBITDA at the end of 2003. The possibility of reaching this objective is greatly dependent on the regulatory developments in Denmark, among other factors.

      In Sweden, underlying EBITDA improved to MSEK 3,245 (3,137) despite lower net sales. The improvement in earnings is attributable to reduced costs for sales and product development in the retail business and lower maintenance and installation costs in the wholesale business.

      Within Networks, depreciation and write-downs increased to MSEK 4,307 (1,345) in the third quarter. The increase is primarily attributable to the MSEK 2,786 write-down of fixed assets in Denmark.

      Items not reflecting underlying business operations totaled MSEK -378 (-99). Costs for ongoing streamlining measures in the Swedish operations, including provisions for redundant personnel, totaled MSEK 21 and costs for restructuring the Danish operations totaled MSEK 286.

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      Income from associated companies improved to MSEK -32 (-624) as Netia and Eircom/ Comsource no longer burden earnings.

      Losses in Denmark caused operating income to drop to MSEK -1,885 (1,061) in the third quarter.

      Operating income for the nine-month period totaled MSEK 744 (1,294) as losses in Denmark were largely offset by the fact that Eircom/ Comsource did not burden income from associated companies.

      Investments dropped off to MSEK 649 (1,869) during the third quarter, contributing to significantly improved cash flow.

Retail market

      Sales in the retail market declined 8 percent to MSEK 5,543 due to decreased market shares in Swedish fixed telephony. The greatest drop was in local calls due to the carrier preselect reform introduced in February 2002.

      Reduced market shares led call revenues for fixed telephony in Sweden to drop 12 percent to MSEK 1,989 during the quarter. Sales dropped in network capacity, data communications and IT services compared with the same quarter 2001. Sales increased, however, for premium services including Caller ID and Telesvar voicemail for consumers and Advance services for business customers.

      The number of telephone subscriptions in Sweden dropped by 11,000 to 5,594,000. The number of ISDN channels also fell as more and more customers switch from ISDN to ADSL/LAN.

      The Danish retail market also reported somewhat lower sales.

Wholesale market

      Sales in the wholesale operations climbed 23 percent comparatively. The increase was mainly attributable to increased sales of interconnect traffic and network capacity in Sweden.

      Demand for broadband connections remained strong. Third quarter deliveries of ADSL/LAN connections totaled 28,000, of which 13,000 were to service providers outside Telia. As the period drew to a close, there were 379,000 customers connected to Telia’s broadband network through ADSL/LAN solutions.

      In Denmark, sales fell 28 percent due to weaker demand for network capacity from other operators and service providers.

      Reported sales for the wholesale operations fell 9 percent to MSEK 1,072 due to the fact that the installation material purchased by the subcontractor Swedia Networks are no longer reported as sales in Skanova.

Holding

      Telia Holding is responsible for the Group’s investments outside of Telia’s core businesses. Telia Holding comprises a number of consolidated businesses, including Finans/ Credit, Sergel Kredittjänster, Division Satellit, Division Offentlig Telecom, Promotor, Overseas, including Suntel, as well as several associated companies, including Slottsbacken, INGROUP, Drutt Corp, Telefos, AUCS, Infonet Services and COOP Bank.

      Extensive divestitures in 2001 along with the closing down of Vimera (customer training) and Time (accounting services) during the second quarter 2002 as well as ongoing phase-outs of operations within Division Satellit resulted in reduced net sales, while underlying EBITDA and the margin improved.

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			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep
MSEK			2002				2001				2002				2001
Net sales				458				1,649				1,378				8,889
	of which external			243				624				704				2,525
Underlying EBITDA				142				20				345				150
EBITDA margin (%)				31.0				1.2				25.0				1.7
	Depreciation, amortization etc.			-115				-185				-355				-661
	Items not reflecting underlying business operations			137				-902				36				-861
	Income from associates			-53				2,872				123				5,758
Operating income				111				1,805				149				4,386
Investments				239				240				710				2,610
	of which CAPEX			67				186				244				706

      For the remaining operations, external net sales fell during the third quarter to MSEK 243 (277) while underlying EBITDA increased to MSEK 142 (130). The drop in sales is

      Depreciation fell to MSEK 115 (185) due to divestitures/-phase-outs of operations.

      Items not reflecting underlying business operations totaled MSEK 137 (-902) and consisted mainly of a capital gain of MSEK 145 from the sale of Telia’s remaining 9 percent holding in the Orbiant Group to Flextronics. Divestiture decisions made during the third quarter led to additional redundancies, and provisions for restructuring costs of MSEK 12 were made.

      Income from associated companies totaled MSEK -53 (2,872). Capital gains affected earnings by MSEK 9 compared with MSEK 3,047 in the comparative quarter.

      Operating income totaled MSEK 111 (1,805).

      Investments totaled MSEK 239 (240). MSEK 129 referred to loan conversion to shareholder contributions in AUCS, MSEK 55 to Finans/ Credit’s leasing operations, MSEK 22 to network investments in Suntel and MSEK 33 to shareholder contributions in COOP Bank.

Outlook 2002

      Telia’s efforts aimed at developing and streamlining its core businesses began to yield results in the third quarter. In the coming quarter, we expect the costs of planned marketing activities to have a slowing effect on earnings.

      Our focus on reducing investments has been successful, though we are planning to raise our level of investment somewhat in the fourth quarter.

Stockholm, October 25, 2002

Anders Igel

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Auditors’ Review Report

      We have made a review of this interim report in accordance with recommendations issued by the Swedish Institute of Authorized Public Accountants. A review is substantially limited in scope in comparison to an audit.

      Nothing has come to our attention that indicates that this interim report fails to comply with the requirements of the Swedish Securities Exchange Act and International Accounting Standards (IAS).

Stockholm, October 25, 2002

Ernst & Young AB
Torsten Lyth Authorized Public Accountant		Gunnar Widhagen Authorized Public Accountant		Filip Cassel Authorized Public Accountant

Financial Information Year-end Report 2002 February 3, 2003		Questions regarding content: Telia AB, Investor Relations SE-123 86 Farsta, Sweden Tel. +46 (0)8 713 1000 Fax +46 (0)8 713 6947 www.telia.com, Investor Relations		Reports may be ordered via: Tel. +46 (0)8 713 7143 Fax +46 (0)8 604 5472 www.telia.com, Investor Relations

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Consolidated Income Statements

		Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Oct 2001-				Jan-Dec				Jan-Dec
MSEK		2002				2001				2002				2001				Sep 2002				2001				2000
Net sales			14,496				14,431				42,727				42,226				57,697				57,196				54,064
Costs of production			-8,972				-9,432				-27,316				-27,433				-40,318				-40,435				-33,028
Gross income			5,524				4,999				15,411				14,793				17,379				16,761				21,036
Sales, administrative, and R&D expenses			-4,287				-4,272				-13,291				-12,596				-18,638				-17,943				-16,326
Other operating revenues and expenses, net			-12,010				-321				-12,440				-43				-11,891				506				8,493
Income from associated companies			-42				2,339				333				2,390				4,079				6,136				-1,197
Operating income			-10,815				2,745				-9,987				4,544				-9,071				5,460				12,006
Net financial revenues and expenses			-149				-254				-520				-642				-530				-652				-289
Income after financial items			-10,964				2,491				-10,507				3,902				-9,601				4,808				11,717
Income taxes			852				-573				544				-1,421				-952				-2,917				-1,447
Minority interests			-6				-18				2				-40				20				-22				8
Net income			-10,118				1,900				-9,961				2,441				-10,533				1,869				10,278
Loss/earnings per share, basic (SEK)			-3.37				0.63				-3.32				0.81				-3.51				0.62				3.50
Loss/earnings per share, diluted (SEK)			-3.37				0.63				-3.32				0.81				-3.51				0.62				3.50

Quarterly Data

			2002												2001																2000
MSEK			Q3				Q2				Q1				Q4				Q3				Q2				Q1				Q4				Q3
Net sales				14,496				14,346				13,885				14,970				14,431				14,203				13,592				14,540				13,487
Underlying EBITDA				4,281				3,587				3,381				3,133				3,420				3,014				3,348				3,790				3,180
	Items not reflecting underlying business operations			-3,997				-827				23				322				-239				271				30				6,937				-116
	Income from associates			-42				363				12				3,746				2,339				208				-157				-370				-759
EBITDA				242				3,123				3,416				7,201				5,520				3,493				3,221				10,357				2,305
	Depreciation, amortization and write-downs			-11,057				-3,004				-2,707				-6,285				-2,775				-2,505				-2,410				-2,427				-2,099
Operating income				-10,815				119				709				916				2,745				988				811				7,930				206
Income after financial items				-10,964				-78				535				906				2,491				909				502				7,658				267
Net income				-10,118				30				127				-572				1,900				250				291				7,408				172
Earnings per share, basic (SEK)				-3.37				0.01				0.04				-0.19				0.63				0.08				0.10				2.47				0.06
Earnings per share, diluted (SEK)				-3.37				0.01				0.04				-0.19				0.63				0.08				0.10				2.47				0.06
Operating cash flow				2,108				1,472				-865				9,171				4,745				3,158				-3,026				3,486				-25,923
Investments				1,956				2,637				2,053				5,157				5,965				5,954				3,659				10,311				16,745
	of which CAPEX			1,783				2,091				2,022				4,849				5,630				3,666				3,568				7,185				3,369
	of which acquisitions			173				546				31				308				335				2,288				91				3,126				13,376

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Condensed Consolidated Balance Sheets

		Sep 30,				Sep 30,				Dec 31,				Dec 31,
MSEK		2002				2001				2001				2000
Assets
Intangible fixed assets			27,273				28,439				26,816				25,198
Tangible fixed assets			37,041				49,449				47,314				43,807
Financial fixed assets			19,473				18,934				20,784				22,335
Total fixed assets			83,787				96,822				94,914				91,340
Inventories, etc.			348				854				636				773
Receivables			23,325				32,170				23,521				29,072
Short-term investments			1,985				345				7,602				178
Cash and bank			1,919				948				1,518				1,352
Total current assets			27,577				34,317				33,277				31,375
Total assets			111,364				131,139				128,191				122,715
Equity and liabilities
Shareholders’ equity			50,526				61,884				59,885				55,988
Minority interests			290				1,536				204				320
Provisions for pensions and employee contracts			1,514				2,529				2,358				3,525
Deferred tax liability, other provisions			13,557				9,109				10,749				7,826
Total provisions			15,071				11,638				13,107				11,351
Long-term loans			14,113				25,984				25,193				20,876
Short-term loans			8,083				5,825				3,931				13,166
Non-interest-bearing liabilities			23,281				24,272				25,871				21,014
Total liabilities			45,477				56,081				54,995				55,056
Total equity and liabilities			111,364				131,139				128,191				122,715

Condensed Consolidated Cash Flow Statements and Changes in Net Interest-bearing Liability

		Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Oct 2001-				Jan-Dec				Jan-Dec
MSEK		2002				2001				2002				2001				Sep 2002				2001				2000
Cash flow before change in working capital			3,088				2,400				8,357				7,049				11,580				10,272				9,589
Change in working capital			745				716				177				-1,123				1,444				144				563
Cash flow from operating activities			3,833				3,116				8,534				5,926				13,024				10,416				10,152
Cash flow from investing activities			-1,725				1,629				-5,819				-1,049				-1,138				3,632				-37,121
Operating cash flow			2,108				4,745				2,715				4,877				11,886				14,048				-26,969
Cash flow from financing activities			-1,425				-5,021				-7,960				-5,426				-9,142				-6,608				26,818
Cash flow for the period			683				-276				-5,245				-549				2,744				7,440				-151
Cash and cash equivalents, opening balance			3,027				1,207				8,923				1,437				949				1,437				1,575
Cash flow for the period			683				-276				-5,245				-549				2,744				7,440				-151
Exchange rate differences in cash and cash equivalents			-41				18				-9				61				-24				46				13
Cash and cash equivalents, closing balance			3,669				949				3,669				949				3,669				8,923				1,437
Net interest-bearing liability, opening balance			10,336				19,069				10,661				20,235				15,769				20,235				7,527
Change in net borrowings			-1,949				-2,801				-1,710				-3,470				-6,647				-8,407				12,429
Change in pension provisions			-280				-499				-844				-996				-1,015				-1,167				279
Net interest-bearing liability, closing balance			8,107				15,769				8,107				15,769				8,107				10,661				20,235

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Condensed Consolidated Statements of Changes in Shareholders’ Equity

		Sep 30,				Sep 30,				Dec 31,				Dec 31,
MSEK		2002				2001				2001				2000
Opening balance			59,885				55,988				55,988				32,893
Change of accounting principles (IAS 39)			—				-342				-342				—
Adjusted opening balance			59,885				55,646				55,646				32,893
Dividend			-600				-1,501				-1,501				-1,470
New share issue			—				—				—				12,750
Underwriting expenses after tax posted directly to equity			16				—				-16				-231
Transactions with outside parties			-16				-128				-155				-82
Share of earnings in companies previously outside the Group			—				—				—				29
Differences arising from translation of foreign operations			1,128				5,787				4,268				2,127
Fair value measurement of securities available for sale			15				-21				143				—
Gains/ losses on instruments used to hedge cash flow			51				102				114				—
Differences after tax on forward contracts used for equity hedge			8				-442				-483				-306
Net income for the period			-9,961				2,441				1,869				10,278
Closing balance			50,526				61,884				59,885				55,988

Business Area Breakdown

July-September 2002 or September 30, 2002

							Internet				International								Group-				of which
MSEK			Mobile				Services				Carrier				Networks				wide				Holding				Group
Net sales				5,743				1,046				1,378				8,093				-1,764				458				14,496
External net sales				5,367				1,034				1,176				6,615				304				243				14,496
Underlying EBITDA				1,800				-92				-255				2,832				-4				142				4,281
Depreciation, amortization & write-downs				-1,036				-124				-5,457				-4,307				-133				-115				-11,057
Items not reflecting underlying business operations				-38				-19				-3,649				-378				87				137				-3,997
Income from associated companies				81				-33				0				-32				-58				-53				-42
Operating income				807				-268				-9,361				-1,885				-108				111				-10,815
Operating capital				36,509				905				426				24,927				-4,294				2,134				58,473
	of which Segment assets			42,275				2,179				8,688				33,965				8,654				6,777				95,761
	of which Segment liabilities			-5,766				-1,274				-8,262				-9,038				-12,948				-4,643				-37,288
Equity participations in associates				2,993				0				0				2,526				2,880				2,880				8,399
Investments				633				67				222				649				385				239				1,956
	of which CAPEX			633				68				222				649				211				67				1,783
Number of employees				4,371				1,420				784				7,399				2,270				1,465				16,244
Average number of full-time employees				4,470				1,377				785				7,300				2,288				1,478				16,220

B-17

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Table of Contents

July-September 2001 or September 30, 2001 (restated)

							Internet				International								Group-				of which
MSEK			Mobile				Services				Carrier				Networks				wide				Holding				Group
Net sales				5,247				765				1,283				8,229				-1,093				1,649				14,431
External net sales				4,786				797				1,003				7,183				662				624				14,431
Underlying EBITDA				1,375				-229				-614				3,129				-241				20				3,420
Depreciation, amortization & write-downs				-980				-108				-135				-1,345				-207				-185				-2,775
Items not reflecting underlying business operations				-33				-15				1				-99				-93				-902				-239
Income from associated companies				105				-9				0				-624				2,867				2,872				2,339
Operating income				467				-361				-748				1,061				2,326				1,805				2,745
Operating capital				36,647				1,680				11,506				29,380				-1,187				3,185				78,026
	of which Segment assets			43,676				2,867				17,386				40,324				8,316				8,275				112,569
	of which Segment liabilities			-7,029				-1,187				-5,880				-10,944				-9,503				-5,090				-34,543
Equity participations in associates				2,564				30				0				2,299				3,727				3,727				8,620
Investments				2,100				129				1,620				1,869				247				240				5,965
	of which CAPEX			1,835				129				1,643				1,830				193				186				5,630
Number of employees				5,029				1,272				730				7,897				7,581				6,832				22,509
Average number of full-time employees				4,791				1,199				653				7,585				11,436				10,656				25,664

January-September 2002 or September 30, 2002

							Internet				International								Group-				of which
MSEK			Mobile				Services				Carrier				Networks				wide				Holding				Group
Net sales				16,214				3,057				3,868				24,732				-5,144				1,378				42,727
External net sales				15,131				3,027				3,264				20,403				902				704				42,727
Underlying EBITDA				4,391				-406				-873				8,440				-303				345				11,249
Depreciation, amortization & write-downs				-2,875				-493				-5,868				-7,128				-404				-355				-16,768
Items not reflecting underlying business operations				-386				-116				-3,650				-641				-8				36				-4,801
Income from associated companies				212				-51				0				74				98				123				333
Operating income				1,342				-1,066				-10,391				745				-617				149				-9,987
Operating capital				36,509				905				426				24,927				-4,294				2,134				58,473
	of which Segment assets			42,275				2,179				8,688				33,965				8,654				6,777				95,761
	of which Segment liabilities			-5,766				-1,274				-8,262				-9,038				-12,948				-4,643				-37,288
Equity participations in associates				2,993				0				0				2,526				2,880				2,880				8,399
Investments				2,012				303				660				2,709				962				710				6,646
	of which CAPEX			1,761				274				660				2,706				495				244				5,896
Number of employees				4,371				1,420				784				7,399				2,270				1,465				16,244
Average number of full-time employees				4,470				1,377				785				7,300				2,288				1,478				16,220

January-September 2001 or September 30, 2001 (restated)

							Internet				International								Group-				of which
MSEK			Mobile				Services				Carrier				Networks				wide				Holding				Group
Net sales				14,692				2,337				3,361				24,742				-2,906				8,889				42,226
External net sales				13,143				2,325				2,630				21,472				2,656				2,525				42,226
Underlying EBITDA				3,616				-747				-1,181				8,759				-665				150				9,782
Depreciation, amortization & write-downs				-2,499				-281				-305				-3,877				-728				-661				-7,690
Items not reflecting underlying business operations				-47				-24				0				-58				191				-861				62
Income from associated companies				224				-36				0				-3,530				5,732				5,758				2,390
Operating income				1,294				-1,088				-1,486				1,294				4,530				4,386				4,544
Operating capital				36,647				1,680				11,506				29,380				-1,187				3,185				78,026
	of which Segment assets			43,676				2,867				17,386				40,324				8,316				8,275				112,569
	of which Segment liabilities			-7,029				-1,187				-5,880				-10,944				-9,503				-5,090				-34,543
Equity participations in associates				2,564				30				0				2,299				3,727				3,727				8,620
Investments				3,307				672				3,880				5,155				2,564				2,610				15,578
	of which CAPEX			3,027				605				3,880				4,692				660				706				12,864
Number of employees				5,029				1,272				730				7,897				7,581				6,832				22,509
Average number of full-time employees				4,791				1,199				653				7,585				11,436				10,656				25,664

B-18

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Table of Contents

January-December 2001 or December 31, 2001 (restated)

							Internet				International								Group-				of which
MSEK			Mobile				Services				Carrier				Networks				wide				Holding				Group
Net sales				19,830				3,305				4,632				34,065				-4,636				10,680				57,196
External net sales				17,857				3,288				3,652				29,159				3,240				3,072				57,196
Underlying EBITDA				4,705				-970				-1,569				11,710				-961				265				12,915
Depreciation, amortization & write-downs				-3,385				-606				-3,589				-5,422				-973				-886				-13,975
Items not reflecting underlying business operations				-49				-28				-1				-71				533				-209				384
Income from associated companies				361				-45				0				-2,363				8,183				8,233				6,136
Operating income				1,632				-1,649				-5,159				3,854				6,782				7,403				5,460
Operating capital				36,499				1,401				8,652				30,795				-7,197				287				70,150
	of which Segment assets			42,810				2,810				14,074				39,525				8,151				1,296				107,370
	of which Segment liabilities			-6,311				-1,409				-5,422				-8,730				-15,348				-1,009				-37,220
Equity participations in associates				3,061				22				0				3,488				3,356				3,356				9,927
Investments				4,979				903				5,037				7,129				2,687				2,744				20,735
	of which CAPEX			4,341				836				5,037				6,767				732				788				17,713
Number of employees				4,813				1,369				777				7,910				2,280				1,576				17,149
Average number of full-time employees				4,857				1,257				671				7,693				10,501				9,729				24,979

Geographic Segment Breakdown

January-September 2002 or September 30, 2002

						Other Nordic				Baltic				Rest of				Rest of
MSEK		Sweden				countries				Region				Europe				world				Group
External net sales			33,471				6,941				168				1,461				686				42,727
Depreciation, amortization & write-downs			-6,900				-5,471				-23				-3,843				-531				-16,768
Income from associated companies			-192				1				133				194				197				333
Operating income			2,947				-5,319				117				-6,906				-826				-9,987
Operating capital			18,562				32,769				5,161				-595				2,576				58,473
of which Segment assets			45,045				38,030				5,287				3,867				3,532				95,761
of which Segment liabilities			-26,483				-5,261				-126				-4,462				-956				-37,288
Equity participations in associates			772				-1				5,017				461				2,150				8,399
Investments			3,987				1,825				47				739				48				6,646
of which CAPEX			3,618				1,821				47				368				42				5,896
Number of employees			12,733				2,513				189				355				454				16,244
Average number of full-time employees			12,576				2,619				194				354				477				16,220

January-September 2001 or September 30, 2001

						Other Nordic				Baltic				Rest of				Rest of
MSEK		Sweden				countries				Region				Europe				world				Group
External net sales			34,338				5,858				103				1,202				725				42,226
Depreciation, amortization & write-downs			-5,309				-1,988				-16				-169				-208				-7,690
Income from associated companies			2,919				-19				-2,047				-1,159				2,696				2,390
Operating income			8,514				-1,567				-2,065				-2,289				1,951				4,544
Operating capital			25,976				35,505				5,150				7,757				3,638				78,026
of which Segment assets			52,179				40,278				5,263				10,139				4,710				112,569
of which Segment liabilities			-26,203				-4,773				-113				-2,382				-1,072				-34,543
Equity participations in associates			793				-2				5,034				462				2,333				8,620
Investments			7,369				3,972				884				2,765				588				15,578
of which CAPEX			6,009				3,480				48				2,748				579				12,864
Number of employees			18,720				2,690				180				362				557				22,509
Average number of full-time employees			21,487				2,982				177				423				595				25,664

B-19

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Table of Contents

January-December 2001 or December 31, 2001

						Other Nordic				Baltic				Rest of				Rest of
MSEK		Sweden				countries				Region				Europe				world				Group
External net sales			46,348				8,113				133				1,667				935				57,196
Depreciation, amortization & write-downs			-7,975				-2,788				-23				-2,920				-269				-13,975
Income from associated companies			5,497				-22				-1,923				-246				2,830				6,136
Operating income			12,403				-2,483				-1,967				-4,474				1,981				5,460
Operating capital			24,218				34,289				5,623				5,647				373				70,150
of which Segment assets			48,862				39,549				5,807				8,919				4,233				107,370
of which Segment liabilities			-24,644				-5,260				-184				-3,272				-3,860				-37,220
Equity participations in associates			557				-3				5,508				1,568				2,297				9,927
Investments			10,122				5,136				1,271				3,661				545				20,735
of which CAPEX			8,668				4,752				83				3,611				599				17,713
Number of employees			13,365				2,739				196				352				497				17,149
Average number of full-time employees			20,922				2,880				201				411				565				24,979

Selected Explanatory Notes to the Financial Statements

Items Not Reflecting Underlying Business Operations

		Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Oct 2001-				Jan-Dec				Jan-Dec
MSEK		2002				2001				2002				2001				Sep 2002				2001				2000
Phase-out of operations (excluding depreciation, amortization and write-downs)			-3,939				-510				-4,127				-510				-4,095				-478				—
Personnel redundancy costs			-45				—				-370				—				-370				—				—
Certain pension-related items			-159				156				-354				314				-580				88				854
Initial public offering/ integration expenses			—				—				—				—				—				—				-144
Capital gains/ losses (excluding associates)			146				115				50				258				566				774				7,628
Total			-3,997				-239				-4,801				62				-4,479				384				8,338

Income from Associated Companies

		Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Oct 2001-				Jan-Dec				Jan-Dec
MSEK		2002				2001				2002				2001				Sep 2002				2001				2000
Core business			11				-533				210				-3,368				1,481				-2,097				301
Baltic states (Mobile/ Networks)			47				45				124				125				194				195				189
Netia (Networks)			0				-521				0				-2,443				-21				-2,464				-411
Comsource/ Eircom (Networks)			-0				-87				151				-1,053				1,330				126				-933
Other			-36				30				-65				3				-22				46				1,456
Holding			-53				2,872				123				5,758				2,598				8,233				-1,498
Unisource/AUCS			-0				4				40				-106				-226				-372				1,445
Telia Overseas			17				54				273				2,655				412				2,794				-1,719
Eniro			-2				3,043				-3				3,423				2,626				6,052				185
Other			-68				-229				-187				-214				-214				-241				-1,409
Total			-42				2,339				333				2,390				4,079				6,136				-1,197

B-20

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Table of Contents

Long-lived Assets

		Intangible assets																								Tangible assets
		Goodwill												Other intangibles
		Sep 30,				Dec 31,				Dec 31,				Sep 30,				Dec 31,				Dec 31,				Sep 30,				Dec 31,				Dec 31,
MSEK		2002				2001				2000				2002				2001				2000				2002				2001				2000
Opening balance			24,686				23,935				1,143				2,130				1,263				1,003				47,314				43,807				33,318
Purchases			8				448				22,893				394				1,316				509				5,513				16,409				16,084
Operations acquired			—				—				19				—				—				40				—				1,291				2,431
Sales/ discards			-4				—				-31				-18				-1				-23				-208				-875				-579
Operations divested			—				-396				-251				—				-86				-4				-2				-1,258				-387
Reclassifications			-2				-2				-10				269				-68				-76				-480				-620				54
Amortization, depreciation			-1,086				-1,375				-655				-322				-338				-212				-7,122				-8,825				-7,352
Write-downs, reversals of write-downs			-339				-28				-1				-41				-2				—				-7,869				-3,428				-36
CAPEX contribution from CATV customers			—				—				—				—				—				—				-1				6				21
Advances			—				—				—				—				—				—				-3				3				—
Exchange rate differences			1,608				2,104				828				-10				46				26				-101				804				253
Closing balance			24,871				24,686				23,935				2,402				2,130				1,263				37,041				47,314				43,807

Cash Flow from Investing Activities

		Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Oct 2001-				Jan-Dec				Jan-Dec
MSEK		2002				2001				2002				2001				Sep 2002				2001				2000
Shares, participations & operations acquired			-227				-248				-572				-1,762				-1,051				-2,241				-30,841
Shares, participations & operations divested			106				4,331				1,144				9,991				6,784				15,631				9,325
Intangible & tangible fixed assets acquired			-1,774				-4,643				-5,860				-11,839				-10,943				-16,922				-15,997
Other investing activities, net			170				2,189				-531				2,561				4,072				7,164				392
Total			-1,725				1,629				-5,819				-1,049				-1,138				3,632				-37,121

Net Indebtedness

			Sep 30,				Sep 30,				Dec 31,				Dec 31,
MSEK			2002				2001				2001				2000
Long-term and short-term loans				22,196				31,809				29,124				34,042
Less: Interest-bearing financial assets				-7,309				-6,503				-7,510				-4,968
	Interest-bearing receivables			-4,390				-10,773				-4,191				-10,834
	Short-term investments, cash and bank			-3,904				-1,293				-9,120				-1,530
Total net borrowings				6,593				13,240				8,303				16,710
Provision for pensions				1,514				2,529				2,358				3,525
Total net interest-bearing liability				8,107				15,769				10,661				20,235

B-21

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Table of Contents

Gross Investments by Class of Asset

			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Oct 2001-				Jan-Dec				Jan-Dec
MSEK			2002				2001				2002				2001				Sep 2002				2001				2000
Goodwill				4				82				8				535				-79				448				22,893
Other intangible assets				192				1,265				394				1,379				331				1,316				509
Real estate				4				96				21				193				97				269				552
Machinery and equipment				1,587				4,269				5,481				11,292				10,317				16,128				15,519
	Fixed networks			682				1,801				2,308				3,436				5,894				7,022				4,115
	Mobile networks			449				422				1,246				1,113				2,257				2,124				1,411
	Other machinery and equipment			456				2,046				1,927				6,743				2,166				6,982				9,993
Shares and participations				169				253				742				2,179				1,137				2,574				8,269
Total				1,956				5,965				6,646				15,578				11,803				20,735				47,742
	of which CAPEX			1,783				5,630				5,896				12,864				10,745				17,713				16,580
	of which acquisitions			173				335				750				2,714				1,058				3,022				31,162

Financial Instruments

			September 30, 2002								September 30, 2001								December 31, 2001
MSEK			Book value				Fair value				Book value				Fair value				Book value				Fair value
Equity participations in associates				8,399				7,400				8,620				10,969				9,927				9,682
Other holdings of securities				338				338				342				342				426				426
Other long- and short-term receivables				10,260				10,188				15,628				15,556				10,061				9,973
Short-term investments				235				235				344				344				197				197
Interest rate swaps received				656				656				248				248				673				673
Interest rate swaps paid				-647				-647				-249				-249				-646				-646
FX interest rate swaps received				12,189				12,189				8,527				8,527				12,629				12,629
FX interest rate swaps paid				-11,097				-11,097				-7,218				-7,218				-11,442				-11,442
Other currency derivatives				119				119				441				441				355				355
Total assets				20,452				19,381				26,683				28,960				22,180				21,847
Provisions for pensions				1,514				1,514				2,529				2,529				2,358				2,358
Long-term loans				14,158				14,570				26,792				27,254				25,543				25,890
Short-term loans				8,147				8,206				5,954				5,973				4,030				4,044
Interest rate swaps received				-1,555				-1,555				-1,729				-1,729				-1,970				-1,970
Interest rate swaps paid				1,659				1,659				1,757				1,757				2,062				2,062
FX interest rate swaps received				-1,802				-1,802				-7,847				-7,847				-1,840				-1,840
FX interest rate swaps paid				1,894				1,894				7,274				7,274				1,901				1,901
Other currency derivatives				71				71				671				671				430				430
Total liabilities				24,086				24,557				35,401				35,882				32,514				32,875
Less book value of:
	— pensions			-1,514								-2,529								-2,358
	— accrued interest			-305								-392								-602
	— other currency derivatives			-71								-671								-430
Book value of interest-bearing liabilities				22,196								31,809								29,124
FX swaps/ forward contracts (portfolio)
Purchases of foreign currency				15,218				15,218				15,217				15,217				19,972				19,972
Sales of foreign currency				9,753				9,753				18,252				18,252				14,030				14,030

B-22

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Table of Contents

Changes in Share Capital

			Number of				Par value,				Share capital,
			shares				SEK/share				KSEK
Share capital, Dec 31, 1999				8,800,000				1,000.00				8,800,000
	Bonus issue, May 20, 2000			—				1,036.80				323,840
	Split 324:1, May 20, 2000			2,842,400,000				3.20				—
	New share issue, June 16, 2000			150,000,000				3.20				480,000
Share capital, Dec 31, 2000				3,001,200,000				3.20				9,603,840
Share capital, Dec 31, 2001				3,001,200,000				3.20				9,603,840
Share capital, Sep 30, 2002				3,001,200,000				3.20				9,603,840

Average Number of Shares

Period			Number
July-September 2002				3,001,200,000
	After dilution			3,001,200,000
July-September 2001				3,001,200,000
	After dilution			3,001,200,000
January-Sep 2002				3,001,200,000
	After dilution			3,001,200,000
January-Sep 2001				3,001,200,000
	After dilution			3,001,200,000
Oct 2001-Sep 2002				3,001,200,000
	After dilution			3,001,200,000
January-Dec 2001				3,001,200,000
	After dilution			3,001,200,000
January-Dec 2000				2,932,757,377

Contingent Assets and Contingent Liabilities

		Sep 30,				Dec 31,
MSEK		2002				2001
Contingent assets			—				—
Collateral pledged
Shares in subsidiaries			92				82
Shares in associated companies			143				—
Blocked funds in bank accounts			96				9
Total			331				91
Contingent liabilities
Credit & performance guarantees, etc.			549				622
FPG/PRI			163				163
Total			712				785

Contractual Obligations

		Sep 30,				Dec 31,
MSEK		2002				2001
Tangible fixed assets			499				499
Indefeasible Rights of Use (IRU)			55				179
Associated & non-consolidated companies			131				274
Total			685				952

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Deferred tax

		Sep 30,				Dec 31,
MSEK		2002				2001
Deferred tax liability			7,383				6,940
Deferred tax benefit (incl. valuation reserve)			-3,004				-1,490
Net deferred tax liability			4,379				5,450

Basis for Presentation

      General. For the nine-month period ended September 30, 2002 and as in the year ended December 31, 2001, Telia’s consolidated financial statements have been prepared in accordance with International Accounting Standards (IAS). This report has been prepared in accordance with IAS 34 “Interim Financial Reporting.”

      Accounting principles. The applied accounting principles, including the adoption of IAS 39 “Financial Instruments: Recognition and Measurement” as of January 1, 2001, are described in Telia’s Annual Report for 2001.

      Discrepancies between Swedish GAAP and the accounting principles applied by Telia are discussed in a separate note.

      Amounts and dates. Unless otherwise specified, all amounts are in millions of Swedish kronor (MSEK) and are based on the nine-month period ended September 30, 2002 for income statement items and as of September 30, 2002 for balance sheet items, respectively.

      Restated accounts. Some adjustments of the Group’s business organization have been implemented during the nine-month period ended September 30, 2002. Hence, the business area figures in this report have been restated.

      Recently published accounting standards. During 2001 the interpretations SIC-30 “Reporting Currency — Translation from Measurement Currency to Presentation Currency” and SIC-33 “Consolidation and Equity Method — Potential Voting Rights and Allocation of Ownership Interests” were published, which are to be applied to accounting periods beginning January 1, 2002 or later. The interpretation SIC-32 “Intangible Assets — Web Site Costs” was issued on March 13, 2002 and became effective on March 25, 2002. Application of these interpretations has not entailed any changes to the comparative figures.

      During 2000 IAS 41 “Agriculture” was published, which goes into effect on January 1, 2003. IAS 41 does not affect Telia’s operations.

Swedish GAAP

      Differences in principles. Telia’s consolidated financial statements are prepared in accordance with International Accounting Standards (IAS). IAS deviates in certain respects from Swedish GAAP, primarily with respect to the reporting of financial instruments and the computation of pension liability and pension expense. The deviations are described in Telia’s Annual Report for 2001.

      Translation into Swedish GAAP. Application of Swedish GAAP affects consolidated net income and shareholders’ equity as follows.

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		Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep				Jan-Dec
MSEK		2002				2001				2002				2001				2001
Net income under IAS			-10,118				1,900				-9,961				2,441				1,869
Financial instruments			12				-130				26				-142				-43
Pensions			-1,184				-448				-2,839				-978				-1,088
Deferred tax			329				123				788				275				317
Net income under Swedish GAAP			-10,961				1,445				-11,986				1,596				1,055

		Sep 30,				Sep 30,				Dec 31,
MSEK		2002				2001				2001
Shareholders’ equity under IAS			50,526				61,884				59,885
Financial instruments			56				347				126
Pensions			-2,694				255				145
Deferred tax			739				-207				-76
Shareholders’ equity under Swedish GAAP			48,627				62,279				60,080

Changes in Group Composition

      In the beginning of March, 2002, a group of lenders and the largest shareholders, including Telia, came to an agreement for a financial reconstruction of the Polish company Netia Holdings S.A. that primarily entails a conversion of the lenders’ claims to equity in the company. Telia currently owns 48 percent of the share capital in Netia. When all transactions have been completed, Telia’s shareholding will be approximately 3 percent.

      On March 19, 2002, a Memorandum of Understanding was signed with the Indian company Bharti Tele-Ventures for the sale of Telia’s holding of 26 percent of the shares in the mobile operator Bharti Mobile Ltd.

      On April 18, 2002, Telia sold its 40 percent stake in Comsource UnLtd to the other shareholder, the Dutch telecom operator KPN.

      On July 1, 2002, Telia’s remaining 9 percent shareholding in the Orbiant Group was sold to the other shareholder Flextronics.

      On March 26, 2002, Telia and the Finnish telecom operator Sonera Oyj announced plans to merge. On September 30, 2002, Telia issued the prospectus setting forth the terms and conditions of the Exchange Offer being made to all Sonera shareholders through which the merger between Sonera and Telia will be effected. The Exchange Offer acceptance period commenced on October 7, 2002 and will end on November 8, 2002. Telia offers 1.51440 Telia shares in exchange for each Sonera share, one new Telia warrant is offered in exchange for each Sonera warrant issued pursuant to Sonera’s 1999 and 2000 stock option programs and 0.30288 Telia ADSs are offered in exchange for each Sonera ADS (each Telia ADS will be equal to five Telia shares). The completion of the Exchange Offer is subject to certain conditions, including the condition that shares representing more than 90 percent of the shares and votes in Sonera (on a fully diluted basis) shall have been validly tendered and not withdrawn. The merger is conditional upon Telia’s current shareholders authorizing the Board of Directors to issue the new shares and warrants necessary to complete the Exchange Offer. Telia has therefore convened an Extraordinary General Meeting on November 4, 2002. Telia has applied for listing of the Telia share and certain warrants on the Helsinki Stock Exchange and to have the Telia ADSs quoted on NASDAQ in the United States.

Related Party Transactions

      The Swedish State. The Telia Group’s services and products are offered to the Swedish state, its agencies, and state-owned companies in competition with other operators and on conventional commercial terms. Certain state-owned companies run businesses that compete with Telia.

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      Likewise, Telia buys services from state-owned companies at market prices and on otherwise conventional commercial terms. Neither the Swedish state, its agencies, or state-owned companies represent a significant share of Telia’s net sales or income.

      Like other operators whose business requires a permit from the state, Telia pays an annual fee to the National Post and Telecom Agency for the agency’s activities. As from January 1, 2002, the fee is equal to 1.57 thousandths of net sales in the operator’s business for which a permit is required. There are additional fees for the agency’s licensing activities under the Radio Communications Act and the Radio and Telecommunications Terminal Equipment Act.

      Infonet. Telia owns a participating interest in the American company Infonet Services Corp. In the three-month period ended September 30, 2002, Telia sold services and products to Infonet worth MSEK 17 and purchased services and products worth MSEK 58. In the nine-month period ended September 30, 2002, Telia sold services and products to Infonet worth MSEK 29 and purchased services and products worth MSEK 219.

      AUCS. Telia owns a participating interest in the Dutch company AUCS Communications Services. As of September 30, 2002, Telia had interest-bearing claims on AUCS of MSEK 154. In the nine-month period ended September 30, 2002, Telia sold services to AUCS worth MSEK 27.

      Telefos. Telia owns 49 percent of the shares in Telefos AB. As of September 30, 2002, Telia had interest-bearing claims on the Telefos Group of MSEK 1,423 and had signed a limited supplementary guarantee of MSEK 150 for the credit-insured pension commitments of Telefos companies. In the three-month period ended September 30, 2002, Telia sold services and products worth MSEK 81 to the Telefos Group and bought services and products worth MSEK 568. In the nine-month period ended September 30, 2002, Telia sold services and products worth MSEK 295 and bought services and products worth MSEK 2,556. Some of the services purchased by Telia referred to construction of capital assets.

      IN. Telia holds an indirect participating interest in IN-GROUP Sweden AB (IN). In the three-month period ended September 30, 2002, Telia sold services and products worth MSEK 9 and bought services and products worth MSEK 33. In the nine-month period ended September 30, 2002, Telia sold services and products worth MSEK 38 and bought services and products worth MSEK 199.

      Other. In addition to those specified, Telia buys and sells services and products to a limited extent from these and other associated companies, in all cases on market terms.

Non-cash Transactions

      Vehicles. Telia leases vehicles through financial leasing, primarily from GE Capital. New acquisitions during the three-month period and the nine-month period ended September 30, 2002 entailed a non-cash investment of MSEK 7 and MSEK 31, respectively.

      Infrastructure/ capacity swaps. Within the international carrier operations, swap contracts for infrastructure and capacity are signed with other carriers. Until both parties have fulfilled all deliveries as agreed, the value provided might differ from the value received. As of September 30, 2002, Telia had, through non-cash swapping, net received infrastructure and network capacity with a book value of MSEK 24.

      AUCS. Claims of MSEK 187 on the associated company AUCS Communications Services have been converted to shares in the company.

Dividend

      The year 2001 dividend of SEK 0.20 per share, or a total of MSEK 600, was paid out on May 2, 2002.

Financial Risk Management

      Foreign exchange risk. The Telia Group has a relatively limited operational need to net purchase foreign currency, primarily due to the settlement deficit in telephony traffic and import of materials.

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      Telia’s general policy is normally to hedge the majority of known operational transaction exposure up to 12 months into the future. Given an operational net transaction exposure equal to that of 2001, and provided that no hedging measures were taken, there would be a negative impact on Group earnings of approximately MSEK 30 on an annual basis if the Swedish krona weakened one percent against the transaction currencies.

      Telia’s conversion exposure has increased due to the relatively fast growth of Telia’s operations outside of Sweden. Telia does not typically hedge its conversion exposure, unless the exposure would be short-term and relate to a large amount of a freely-convertible foreign currency of a country with smoothly-functioning financial markets. As of September 30, 2002, the Group had no hedged conversion exposure.

      Interest rate risk. Telia’s financial policy provides guidelines for fixing interest rates on loan debt relative to the average life of the loan. The Group’s policy is that the duration of loan debt should be from six months to four years. The general principle is to optimize interest rate risk from an overall Group perspective.

      As of September 30, 2002, the Group had interest-bearing loans of approximately GSEK 22.2 with duration of approximately two years, including derivatives. The volume of loans exposed to changes in interest rates over the next 12-month period was at the same date approximately GSEK 10, assuming that existing loans maturing during that period are refinanced and after accounting for interest rate swaps. The exact effect of a change in interest rates on the financial net depends on the timing of maturity of the debt as well as reset dates for floating rate debt, and that the volume of loans may vary over time, thereby affecting the estimate. Fair value of the loan portfolio would, however, change by approximately MSEK 380, should the level in market interest rates make a parallel shift of one percentage point, and assuming the same volume of loans and a similar duration on those loans as per September 30, 2002.

      Approximately GSEK 7 was used during the first nine months of 2002 to amortize loans. During the third quarter of 2002, continuing uncertainty in the financial markets has led to considerable volatility in the relative interest rate spreads in the credit market for corporate borrowers, including telecom companies. The volatility is expected to continue in the near future.

      Financing and liquidity risk. Telia is considered one of the most creditworthy telecommunications companies in Europe, which gives the Group good opportunities to finance operations using the financial markets.

      In April 2002, the credit rating agency Standard & Poor’s downgraded its credit rating for Telia AB to A+ for long-term borrowing and to A-1 for short-term borrowing. Standard & Poor’s also put Telia’s rating on its watch list for possible downgrading in light of the bid on Sonera Oyj. Telia’s rating from the credit rating agency Moody’s is the highest possible, P-1, for short-term borrowing, while Telia’s rating from Moody’s for long-term borrowing is A1. Moody’s has also posted Telia’s rating on its watch list for possible downgrading.

      Telia AB has a Revolving Credit Facility, i.e., confirmed loan commitments from a consortium of leading international banks, which constitutes a liquidity tool for the Group. At present, the loan commitment amounts to MUSD 1,000 or the equivalent value in certain other currencies. It was not utilized as of September 30.

Parent Company

      The parent company Telia AB, which is domiciled in Stockholm, comprises the Group’s Swedish operations in development and operation of fixed networks and basic production of network services. The parent company also includes Group executive management functions, certain support units and the Group’s internal banking operations.

      Net sales for the nine-month period were MSEK 17,300 (16,752), of which MSEK 14,244 (13,899) was invoiced to subsidiaries. Earnings before appropriations and taxes improved to MSEK -250 (-3,046). During the same period in 2001, the parent company’s shares in Netia were written down. Earnings after

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      The balance sheet total decreased to MSEK 79,011 (82,796 at year-end). Cash flow from operating activities was MSEK 7,489 (1,277), while operating cash flow was MSEK 840 (612). Net borrowings declined, to MSEK 26 (3,858 at year-end). Cash and cash equivalents totaled MSEK 2,394 (8,068 at year-end).

      The equity/ assets ratio (including the equity component of untaxed reserves) improved to 55.8 percent (54.0 percent at year-end 2001).

      Total investments for the nine-month period amounted to MSEK 3,368 (7,885), including MSEK 2,423 (3,529) in tangible fixed assets, primarily fixed telephony installations. Other investments totaling MSEK 945 (4,356) were primarily attributable to capital infusions in subsidiaries and associated companies. Of the capital infusions to subsidiaries, MSEK 829 was provided through debt conversion.

      The number of employees as of September 30, 2002, was 3,324 (3,150 at year-end 2001).

Geographical Markets, Business Areas⁽¹⁾

			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep
MSEK			2002				2001				2002				2001
Mobile
Mobile telephony, Sweden
Net sales				3,135				3,084				8,836				8,564
	of which external			2,820				2,715				7,916				7,418
Underlying EBITDA				1,518				1,429				3,995				3,833
EBITDA margin (%)				48.4				46.3				45.2				44.8
Investments				154				448				744				952
Mobile telephony, Norway
Net sales				1,513				1,198				4,045				3,157
	of which external			1,484				1,190				3,997				3,135
Underlying EBITDA				629				424				1,641				1,034
EBITDA margin (%)				41.6				35.4				40.6				32.8
Investments				308				214				736				501
Mobile telephony, Denmark
Net sales				298				187				744				554
	of which external			250				155				626				482
Underlying EBITDA				-119				-128				-479				-347
EBITDA margin (%)				-39.9				-68.4				-64.4				-62.6
Investments				185				1,296				333				1,456
Mobile telephony, Finland
Net sales				240				175				702				470
	of which external			235				175				694				456
Underlying EBITDA				-34				-95				-237				-265
EBITDA margin (%)				-14.2				-54.3				-33.8				-56.4
Investments				32				94				179				217
Business solutions, telephony
Net sales				502				386				1,501				1,343
	of which external			408				347				1,402				1,086
Underlying EBITDA				-21				-73				-73				-92
EBITDA margin (%)				-4.2				-18.9				-4.9				-6.9
Investments				6				8				17				13

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			Jul-Sep				Jul-Sep				Jan-Sep				Jan-Sep
MSEK			2002				2001				2002				2001
Internet Services
Sweden
Net sales				886				644				2,577				1,996
	of which external			875				676				2,548				1,985
Underlying EBITDA				-93				-208				-401				-697
EBITDA margin (%)				-10.5				-32.3				-15.6				-34.9
Investments				48				84				233				562
Networks
Sweden
Net sales				7,718				7,747				23,558				23,303
	of which external			6,370				6,836				19,552				20,398
Underlying EBITDA				3,245				3,137				8,766				8,753
EBITDA margin (%)				42.0				40.5				37.2				37.6
Investments				575				1,394				2,296				3,888

				Sep 30,				Jun 30,				Mar 31,				Dec 31,				Dec 31,				Dec 31,				Dec 31,				Dec 31,				Dec 31,
’000				2002				2002				2002				2001				2000				1999				1998				1997				1996
Mobile telephony,
	Sweden				3,540				3,484				3,459				3,439				3,257				2,638				2,206				1,935				1,745
	Norway				1,022				996				985				970				850				—				—				—				—
	Other Nordic countries				696				648				567				527				412				203				120				—				—
Internet,(2)
	Sweden				1,078				1,044				1,028				992				738				604				440				231				106
		of which broadband			342				322				288				245				51				6				1				—				—
	Denmark				168				164				158				147				108				78				63				11				—
		of which broadband			74				70				65				58				30				11				3				—				—
Cable TV,
	Sweden				1,403				1,384				1,389				1,378				1,358				1,348				1,330				1,308				1,291
	Denmark				188				186				186				179				175				170				164				145				137
Fixed telephony, PSTN,
	Sweden				5,594				5,605				5,642				5,663				5,783				5,889				5,965				6,010				6,032
	Denmark				255				256				244				264				232				209				160				86				12
ISDN channels,
	Sweden				900				905				921				922				838				630				424				244				129

(1)		For further information: www.telia.com, Investor Relations, Financial Information, Operational Data
(2)		Internet access via the fixed network and the cable television network

Disclosure Obligation in Finland

      Telia’s interim reports, year-end reports and annual reports as well as stock exchange releases in connection hereto which possibly will be published prior to the implementation of the combination of Telia and Sonera, will be published in Finland in English only. According to the prospectus published in connection with the exchange offer, it is the intention to publish the financial information in Finland also in Finnish and Swedish. Telia intends, however, to publish the financial information in Finnish and Swedish only after the combination of Telia and Sonera is completed.

      The following information is provided pursuant to the Finnish Financial Supervision Authority decision no. 28/269/2002.

      This interim report has been prepared in accordance with chapter 2, section 5 of the Finnish Securities Markets Act.

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      Telia prepares its consolidated financial statements in accordance with International Accounting Standards (IAS). The main differences between Finnish Accounting Standards (Finnish GAAP) and IAS, relevant to Telia, are as follows.

Business combinations

      Under Finnish GAAP an acquisition paid through the issue of own shares does not require that the purchase price is determined based on the market value of the issued shares. IAS require that the purchase price is determined based on the market value of the issued shares which often results in the recognition of goodwill and other assets at consolidation and future depreciation and amortization of such amounts. Historically Telia has not issued own shares at acquisitions but the proposed acquisition of Sonera involves the issue of own shares.

Impairment of fixed assets and long-term investments

      IAS require that if future cash flows are used for recoverability tests these cash flows should be discounted. Finnish GAAP do not exactly define how recoverability tests should be performed.

Capitalization of interest cost relating to investments in associated companies

      Finnish GAAP allow the capitalization of interest costs relating to investments in associated companies if the associated company carries out construction activities that takes time to complete. IAS do not allow capitalization of interest costs relating to investments in associated companies.

Financial instruments

      Under Finnish GAAP, derivative financial instruments cannot be recorded at fair value. Under IAS, all derivatives are recorded in the balance sheet at fair value. The changes in the fair value of derivatives are recorded either in earnings or in a separate component of shareholders’ equity, depending on the intended use and designation of the derivative at its inception.

      Under Finnish GAAP, investments in marketable securities should be recorded at the lower of cost or market value and the unrealized changes are recorded in the income statement as write-downs or reversals of write-downs. Under IAS, Telia reports all marketable securities classified as “available-for-sale” at fair value, and records the unrealized gains and losses as a separate component of shareholders’ equity, unless there is an impairment, in which case a write-down is recorded in the income statement.

Deferred taxes

      Finnish GAAP do not require the recognition of deferred tax assets for certain temporary differences even if it is apparent that the temporary differences reverses in the foreseeable future. IAS require the recognition of a deferred tax asset under such circumstances.

Financial Information/ Underlying EBITDA

      The financial information given in this interim report is based on Telia’s unaudited consolidated interim financial statements that are prepared in accordance with International Accounting Standards (IAS). This interim report includes information on “underlying EBITDA” and on other similar “underlying” measures of Telia’s results of operations. Underlying EBITDA equals operating income before depreciation, amortization and write-downs, net of items not reflecting the underlying business operations and excluding income from associated companies. Items not reflecting the underlying business operations include capital gains and losses, restructuring/ phase-out of operations, personnel redundancy costs, and expenses in conjunction with the initial public offering in 2000. Telia’s management uses underlying EBITDA and operating income as the principal measures for monitoring profitability in internal operations. Management believes that, besides operating income, underlying EBITDA is also a measure commonly reported and widely used by analysts, investors and

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      Underlying EBITDA, however, should not be considered as an alternative to operating income as an indicator of our operating performance. Similarly, underlying EBITDA should not be considered as an alternative to cash flows from operating activities as a measure of liquidity. Underlying EBITDA is not a measure of financial performance under IAS or U.S. GAAP and may not be comparable to other similarly titled measures for other companies. Underlying EBITDA is not meant to be predictive of potential future results.

Forward-Looking Statements

      This interim report contains statements concerning, among other things, Telia’s financial condition and results of operations that are forward-looking in nature. Such statements are not historical facts but, rather, represent Telia’s future expectations. Telia believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions; however, forward-looking statements involve inherent risks and uncertainties, and a number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement, including Telia’s market position, growth in the telecommunications industry in Europe, the effects of competition and other economic, business, competitive and/or regulatory factors affecting the business of Telia and the telecommunications industry in general. Forward-looking statements speak only as of the date they were made, and, other than as required by applicable law, Telia undertakes no obligation to update any of them in light of new information or future events.

Cautionary Disclaimer/ Legend

      The combination of Sonera and Telia will be implemented through an exchange offer being made by Telia to all shareholders of Sonera. The contents of this document are neither an offer to purchase nor a solicitation of an offer to sell shares of Telia. Any offer in the United States will only be made through a prospectus which is part of a registration statement on Form F-4 which Telia filed with the U.S. Securities and Exchange Commission (the “SEC”) on October 1, 2002. Sonera shareholders who are U.S. persons or are located in the United States are urged to carefully review the registration statement on Form F-4, the prospectus included therein and other documents relating to the offer that Telia has filed or will file with the SEC because these documents contain important information relating to the offer. You are also urged to read the related solicitation/ recommendation statement on Schedule 14D-9 that was filed by Sonera with the SEC on October 1, 2002 regarding the offer. You may obtain a free copy of these documents at the SEC’s web site at www.sec.gov. You may also inspect and copy the registration statement on Form F-4, as well as any documents incorporated by reference therein, and the Schedule 14D-9 at the public reference room maintained by the SEC at 450 Fifth Street, NW, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. These documents may also be obtained free of charge by contacting Telia AB, Investor Relations, SE-123 86 Farsta, Sweden. Attention: External Communications or Investor Relations (tel: +46 8 7137143, or Sonera Corporation, Teollisuuskatu 15, P.O. Box 106, FIN-00051 SONERA, Finland. Attention: Investor Relations (tel: +358 20401). YOU SHOULD READ THE PROSPECTUS AND THE SCHEDULE 14D-9 CAREFULLY BEFORE MAKING A DECISION CONCERNING THE OFFER.

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ANNEX C

Interim Report July-September 2002

Sonera Reports Third Consecutive Record Quarter for

	•	Underlying EBITDA rises to €199 million in the third quarter (€183 million in the corresponding quarter in 2001), once again the highest-ever quarterly amount.
	•	Operating profit improves to €100 million (63) in the third quarter. Excluding non-recurring items, the underlying operating profit improves to €114 million (99).
	•	Profit before income taxes and minority interest improves significantly to €77 million (loss of €352 million) in the third quarter. Excluding non-recurring items, the underlying profit before income taxes and minority interest improves to €91 million (50).
	•	Earnings per share are €0.04 (loss per share €0.35) in the third quarter.
	•	Cash provided by operating activities rises to €220 million in the third quarter (84) and free cash flow improves to €157 million (€10 million negative).
	•	Equity-to-assets ratio improves from the second quarter to 37% at the end of September. Net debt decreases slightly to €2,132 million.
	•	Sonera acquires control in Fintur GSM operations in Eurasia and adds 1.5 million subscribers. Sonera consolidates Fintur as of September 2002.
	•	Exchange offer for the merger of Sonera and Telia starts in October.
	•	Sonera upgrades its full-year 2002 outlook: underlying EBITDA to improve by more than one-third from the 2001 level and to be at the level of 35% of revenues.

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Consolidated key figures

		July-				July-								January-				January-								Full
		September				September				Change				September				September				Change				year
		2002				2001				%				2002				2001				%				2001
		(EUR million)
Revenues			551				549				—				1,635				1,631				—				2,187
Comparable revenue growth (%)			5.3				10.2				—				6.4				9.6				—				7.6
Underlying EBITDA			199				183				9				585				407				44				562
Underlying EBITDA margin (%)			36.1				33.3				—				35.8				25.0				—				25.7
Underlying operating profit			114				99				15				339				155				119				230
Reported operating profit			100				63				59				201				989				(80	)			951
Equity income (loss) in associated companies			5				(41	)			112				(3,974	)			(135	)			n/m				(202	)
Underlying profit (loss) before income taxes and minority interest			91				50				82				193				(15	)			n/m				(4	)
Reported profit (loss) before income taxes and minority interest			77				(352	)			122				(3,832	)			453				(946	)			445
Reported net income (loss)			47				(325	)			114				(2,616	)			353				(841	)			409
Cash provided by operating activities			220				84				162				509				106				380				197
Capital expenditures on fixed assets			63				94				(33	)			170				266				(36	)			359
Free cash flow			157				(10	)			n/m				339				(160	)			312				(162	)
Investments in shares and shareholder loans			32				106				(70	)			155				497				(69	)			572
Proceeds from sale of shares and other assets			25				768				(97	)			1,135				1,943				(42	)			2,193
Net debt			2,132				4,494				(53	)			2,132				4,494				(53	)			3,268
Shareholders’ equity			1,921				3,558				(46	)			1,921				3,558				(46	)			4,575
Return on capital employed (%)			9.0				(13.3	)			—				(77.5	)			9.9				—				7.9
Return on shareholders’ equity (%)			10.3				(34.3	)			—				(105.2	)			13.8				—				10.5
Equity-to-assets ratio (%)			36.7				39.1				—				36.7				39.1				—				52.4
Net debt-to-equity ratio (gearing) (%)			104.8				107.1				—				104.8				107.1				—				71.2
Earnings (loss) per share (€)			0.04				(0.35	)			111				(2.35	)			0.39				(703	)			0.44
Shareholders’ equity per share (€)			1.72				3.93				(56	)			1.72				3.93				(56	)			4.10
Average number of shares (thousands)			1,114,752				906,091				23				1,114,752				906,091				23				924,346
Shares outstanding at end of period (thousands)			1,114,752				906,091				23				1,114,752				906,091				23				1,114,752
Average number of personnel			7,412				10,442				(29	)			8,176				10,904				(25	)			10,482

      The interim financial statements have not been audited. The information on associated companies and other major investments which is given in this interim report is based on reports received from the companies or on press releases published by the companies.

Performance continues to improve on all fronts during the third quarter

		July-				July-
		September				September				Change
		2002				2001				%
		(EUR million)
Revenues			551				549				—
Underlying EBITDA			199				183				9
Underlying EBITDA margin, %			36.1				33.3
Reported operating profit			100				63				59
Net income (loss)			47				(325	)			114
Free cash flow			157				(10	)			1,670

      Consolidated revenues in the third quarter of 2002 were €551 million (€549 million in the second quarter of 2001), remaining at the level of the corresponding quarter of 2001. Comparable revenues increased by 5%, taking into account businesses divested and the pro forma revenues of Fintur.

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      Underlying EBITDA (excluding all non-recurring items) hit record highs for the third consecutive quarter, and rose to €199 million (183) in the third quarter, representing 36.1% of revenues (33.3%). The improvement was mainly due to the narrowing of EBITDA losses from Service Businesses, and the consolidation of Fintur as of September 2002.

      Underlying operating profit also improved to €114 million (99) and the reported operating profit improved to €100 million (63), showing a growth of 59%.

      Sonera’s equity income in associated companies in the third quarter improved significantly to an income of €5 million (loss of €41 million), primarily due to the improved results of Turkcell and Fintur, and the discontinued equity accounting for Group 3G in Germany, the carrying value of which Sonera wrote down to zero in the second quarter.

      The underlying profit before income taxes and minority interest almost doubled to €91 million (50). The reported profit before income taxes and minority interest for the third quarter rose to €77 million (loss of €352 million in 2001 primarily due to write-downs on Deutsche Telekom shares). The reported net income was €47 million (loss of €325 million) in the third quarter.

      The underlying earnings per share were €0.05 (€0.06) while the reported earnings per share were €0.04 (loss per share of €0.35).

      Cash provided by operating activities in the third quarter grew significantly to €220 million (84). Cash from operating activities was improved by higher underlying EBITDA and lower interest expenses. At the same time, capital expenditures decreased to €63 million (94), resulting in a considerable improvement in free cash flow (cash from operating activities less capital expenditure on fixed assets) for the third quarter to €157 million (€10 million negative).

      In the third quarter, the return on capital employed was 9.0% (13.3% negative) and the return on shareholders’ equity was 10.3% (34.3% negative).

      During the third quarter, Sonera’s average payroll was 7,412 (10,442), showing a decrease of 29%, primarily due to the divestment of business operations. At the end of September, the number of employees was 7,769, showing a decrease of 23% from the year-end 2001. The acquisition of Fintur added some 850 employees in the consolidated number.

Underlying EBITDA for January-September 44% ahead of last year

      Consolidated revenues in January-September 2002 remained at the level of the previous year and totaled €1,635 million (€1,631 million in January-September 2001). Comparable revenues nevertheless grew by 6%, taking into account the businesses divested and the pro forma revenues of Fintur.

      January-September underlying EBITDA (excluding all non-recurring items) improved by 44% and was €585 million (407), representing 35.8% of revenues (25.0%). The improvement was mainly due to the narrowing of EBITDA losses from Service Businesses.

      Underlying operating profit more than doubled to €339 million (155) while the reported operating profit was €201 million (989). The reported operating profit in January-September 2002 also includes capital gains of €374 million mainly relating to the sales of Pannon, Sonera Info Communications, Primatel and Libancell; non-cash write-downs of €476 million mainly relating to Ipse 2000, Juniper Financial Corporation and 724 Solutions Inc.; expenses of €13 million relating to the planned merger with Telia; and other non-recurring expenses of €23 million mainly relating to the restructuring of operations and other such efforts. In January-September 2001, the reported operating profit included non-recurring income totaling €834 million, mainly relating to the sales of TietoEnator, VoiceStream and Powertel.

      Sonera’s equity loss in associated companies in January-September increased to €3,974 million (loss of €135 million), primarily due to a non-cash write-down recorded for Group 3G in the second quarter.

      The underlying profit before income taxes and minority interest improved to €193 million (loss of €15 million), mainly due to significant improvement in the underlying EBITDA. As a consequence of the

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      The underlying earnings per share improved to €0.15 (loss per share of €0.01) while the reported loss per share was €2.35 (earnings per share of €0.39).

      Cash provided by operating activities in January-September grew almost five-fold to €509 million (106). Free cash flow (cash from operating activities less capital expenditure on fixed assets), which is also the basis for Sonera’s dividend policy, improved to €339 million from the negative free cash flow of €160 million in January-September 2001.

Business areas

      In the autumn of 2001, Sonera set itself a goal of transforming into a customer-driven business organization. As of July 1, 2002, Sonera organized all its product segments and business units in Finland into three layers that coordinate all business horizontally to create a more unified and integrated business and customer approach. The Sales and Marketing layer is responsible for the overall profitability of customer segments or individual large corporate customers. The Products and Services layer is responsible for the product portfolio and the development of new products and services. The Production and Networks layer is responsible for the mobile, backbone and local networks.

      To support the integrated approach, Sonera also plans to simplify its legal structure in Finland by merging its wholly-owned subsidiaries Sonera Telecom, Sonera Entrum, Sonera Solutions, Sonera Gateway, Sonera Plaza and Sonera Juxto into the parent company Sonera Corporation by the end of 2002.

Mobile Communications Finland reports a strong quarter

		July-				July-
		September				September				Change
		2002				2001				%
		(EUR million)
Revenues			312				307				2
Underlying EBITDA			162				158				3
Underlying EBITDA margin, %			51.9				51.5
Reported operating profit			132				126				5
Capital expenditures			22				25				—
Subscriptions at the end of the period, thousands(1)			2,501				2,441				2
GSM customer churn, % (annualized)			11.0				9.5
MoU, minutes			153				149				3
ARPU, €			40.3				40.7				(1	)

(1)		Excluding service providers.

      Revenues from Mobile Communications Finland were up 2% on the previous year, reaching €312 million (307) in the third quarter. Revenue growth was slowed down by the new interconnection agreements applied starting from September 2001 and the lower SMS prices, high overall penetration, as well as the strategic goal to seek profitable growth. On the other hand, revenues were increased by the increased usage of mobile services and the revised revenue sharing of mobile-originated international call revenues between Mobile Communications Finland and Sonera Telecom from the beginning of 2002. Revenues from non-voice services decreased slightly to €36 million (37) in the third quarter.

      The profitability of the business area continued to be very strong. Underlying EBITDA for the third quarter was €162 million (158), corresponding to 51.9% of revenues (51.5%). Operating profit was €132 million (126). Profitability improved due to increased revenues and continued cost control and process development efforts. Capital expenditures for the business area were €22 million during the third quarter (25).

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      Revenues for the nine months January-September totaled €932 million (907), showing a rise of 3% on the previous year. Underlying EBITDA for January-September rose to €473 million (463), corresponding to 50.8% of revenues (51.0%) and operating profit improved to €380 million (368). Capital expenditures for January-September totaled €63 million (75). The simplified free cash flow measure as applied to Sonera’s business areas, underlying EBITDA less capital expenditure, improved by 6% to €410 million (388) in January-September.

      During the third quarter, the average monthly use of a Sonera mobile subscription rose by 3% to 153 minutes (149) and average monthly revenues per user (ARPU) were €40.3 (40.7). The average number of text messages sent from a Sonera GSM subscription per month was 26.7 (25.8) during the third quarter, representing a rise of 3%.

      The number of Sonera’s GSM subscriptions grew by a net 74,465 from the corresponding quarter in 2001, and was 2,472,552 at the end of September (2,398,087). The number of GSM subscriptions increased by a net 19,206 from the end of the second quarter. Sonera’s primary goal is not to focus on market share at the cost of profitability, but to concentrate on creating long-term profitable growth. Annualized GSM customer churn of 11.0% for the third quarter was higher than in the third quarter last year (9.5%) due to increased price competition. Including NMT and service provider subscriptions, the total number of all mobile subscriptions in Sonera’s network was 2,538,066 at the end of the third quarter.

      On September 26, 2002, Sonera launched and demonstrated, together with Nokia, the first 3G services to operate in the GSM/GPRS and UMTS networks. Customers can use the visual services with sound and image at first in the existing mobile network and later, when there are a sufficient number of dual-mode 3G terminals available, also in the UMTS network. In the future, different networks will supplement each other.

Fintur brings significant future growth for Sonera’s International Mobile Communications

			Reported(1)				Reported(1)
			July-				July-
			September				September				Change
			2002				2001				%
			(EUR million)
Revenues				25				(1	)			n/m
Underlying EBITDA				9				(5	)			280
Underlying EBITDA margin, %				36.0				n/m
Reported operating profit				5				(17	)			129
Equity income (loss) in associated companies, before goodwill amortization				13				(32	)			141
Capital expenditures				5				—				n/m
Subscriptions at the end of the period, thousands
	Subsidiaries			1,502				—				n/m
	Associated companies			18,700				16,160				16

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			Pro forma(2)				Pro forma(2)
			July-				July-
			September				September				Change
			2002				2001				%
			(EUR million)
Revenues				74				54				37
Underlying EBITDA				34				20				70
Underlying EBITDA margin, %				45.9				37.0
Reported operating profit				19				(9	)			311
Equity income (loss) in associated companies, before goodwill amortization				16				(14	)			214
Capital expenditures				12				12				—
Subscriptions at the end of the period, thousands
	Subsidiaries			1,502				1,061				42
	Associated companies			18,700				15,099				24

(1)		Includes Fintur from the beginning of September 2002.
(2)		Pro forma presents the Fintur transaction as if it had already taken place on July 1, 2001.

      In August 2002, Sonera completed the purchase of an additional 23.24% interest in Fintur Holdings B.V. from the Çukurova Group, raising its total holding in Fintur to 58.55%. As part of the transaction, Fintur’s loss-making technology and media businesses were sold to the Çukurova Group. Sonera paid a purchase price of approximately €117 million and assumed interest-bearing net debt of Fintur of approximately €125 million.

      Fintur operates through its majority-owned subsidiaries in the emerging GSM markets of Azerbaijan, Georgia, Kazakhstan and Moldova. As of September 30, 2002, Fintur had approximately 1.5 million subscribers, a growth of 42% as compared to September 30, 2001. As the mobile penetration rates in each of these countries are currently estimated to be less than 10%, Sonera believes that Fintur will make a significant contribution to Sonera’s revenue growth in the future. In each of the countries, the Fintur-owned operator is the first or second largest in the market.

      Sonera has consolidated Fintur as of September 2002. Therefore, only one month of Fintur’s results of operations is included in Sonera’s income statement for the third quarter. For the full third quarter, Fintur recorded revenues of US$67 million (US$49 million in the third quarter of 2001), underlying EBITDA of US$34 million (21) and operating profit of US$21 million (9).

      Sonera’s equity income in mobile associated companies, before goodwill amortization, was €13 million (loss of €32 million) in the third quarter, mainly due to improved results of Turkcell and Fintur as compared to the third quarter of 2001, as well as the discontinued equity accounting for Group 3G.

      Estimated aggregate revenues of mobile associated companies were €758 million and increased by 16% in comparable terms, primarily due to MegaFon. At the end of the third quarter, the aggregate number of customers of these associated companies was estimated at 18.7 million, as compared to 15.1 million at the end of the corresponding quarter in 2001 (excluding Fintur).

      Equity income recorded from Turkcell was €1 million (loss of €16 million) for Sonera’s third quarter. Turkcell is consistently included in Sonera’s equity income with a three-month lag. Turkcell’s net income turned positive in the second quarter as a result of the subscriber growth effects on revenues and EBITDA. Turkcell further improved its financial results in the third quarter of 2002 and reported net income of US$59 million as a result of higher revenues and better margins. Therefore, Sonera will record approximately €22 million of equity income from Turkcell for Sonera’s fourth quarter of 2002. Turkcell met its financing obligations by repaying over US$650 million of debt and other payables in the first three quarters of 2002, and even waived its option to extend debt repayments to two local banks. Turkcell’s cash balance increased to US$305 million at the end of the third quarter. Turkcell added approximately 1.1 million net new subscribers during the third quarter and on September 30, 2002, Turkcell had 14.9 million customers, consisting of 4.7 million post-paid and 10.2 million pre-paid subscribers.

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      Equity income recorded from other GSM associated companies decreased to €15 million (18) in the third quarter, primarily due to the sale of Pannon GSM during the first quarter of 2002.

      In Russia, the restructuring of MegaFon has been completed, and Sonera holds 26% in the new company. The customer base of MegaFon grew by approximately 600,000 during the third quarter and totaled approximately 2.3 million at the end of September. MegaFon is the only operator in Russia with licenses spanning the whole country.

      After Sonera wrote down to zero the carrying value of its 42.8% owned German UMTS associated company Group 3G in the second quarter, Sonera no longer records equity losses from Group 3G. In the third quarter of last year, Sonera recorded an equity loss of €16 million from Group 3G.

      In July, Sonera, together with the majority shareholder of Group 3G, the management of Group 3G and a third party advisor, analyzed the feasibility of the business plan that was approved for Group 3G in November 2001. Based on the first six months of experience in and the future outlook for the German market, and based on continued delays in 3G technologies and the higher cost of capital, the shareholders of Group 3G believe that the original strategy for the company is no longer feasible. The Board of Directors of Group 3G decided in July to freeze the operations of Group 3G by the end of 2002. On October 15, Group 3G announced that it will end its GSM/ GPRS network service in mid-November. The customers have the option to migrate to T-Mobile without having to pay a connection fee.

      To ensure the sufficiency of shareholders’ equity in Group 3G, the majority shareholder of Group 3G, Telefónica Móviles, may decide to increase the shareholders’ equity of Group 3G. This may lead to a significant dilution of Sonera’s interest in Group 3G, or may even decrease Sonera’s interest in Group 3G to zero. The dilution is based on a fair market value to be determined for Group 3G at the time of a share capital increase. Sonera has already earlier committed itself not to invest additional funds in Group 3G. As Sonera wrote down to zero its carrying value of Group 3G shares in the second quarter, any dilution would not result in additional loss for Sonera.

      Additionally, the completion of Sonera’s planned merger with Telia will give Telefónica Móviles the right to purchase Sonera’s share in Group 3G, at Telefónica Móviles’ option and at fair market value. According to the shareholders’ agreement, the determination of fair market value is based on appraisals of at least two international investment banks, one appointed by Sonera and the other by Telefónica Móviles.

      As part of its quarterly review of carrying values, Sonera has performed an impairment analysis on Xfera of Spain (Sonera 14.2%) as of September 30, 2002. The analysis supports the carrying value of €72 million for Xfera. Sonera also has capital commitments of a maximum of €278 million to invest in the shareholders’ equity of Xfera. The Spanish government also released part of the originally €428 million performance guarantees in June and July 2002. The outstanding performance guarantees were €383 million on September 30, 2002.

EBITDA losses of Service Businesses clearly within target

		July-				July-
		September				September				Change
		2002				2001				%
		(EUR million)
Revenues			67				76				(12	)
Underlying EBITDA loss			(8	)			(48	)			83
Reported operating loss			(20	)			(71	)			72
Capital expenditures			1				23				(96	)

      Revenues from Service Businesses decreased by 12% to €67 million (76) in the third quarter, primarily due to the divestment of Sonera Info Communications at the end of March 2002. Underlying EBITDA loss for the business area decreased significantly to €8 million (loss of €48 million). Reported operating loss for the business area decreased to €20 million (loss of €71 million) and underlying operating loss decreased to

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      Revenues in the nine months January-September totaled €213 million (233), showing a decrease of 9% on the previous year. The growth in comparable revenues for January-September was 13%, taking into account disposals of businesses. Underlying EBITDA loss for January-September decreased to €31 million (loss of €203 million). Due to sales gains recorded in the first quarter, the reported operating profit in January-September was €2 million (loss of €253 million). The underlying operating loss decreased to €60 million (loss of €239 million). Capital expenditures for January-September totaled €9 million (50). The simplified free cash flow measure as applied to Sonera’s business areas, underlying EBITDA loss plus capital expenditure, narrowed to €40 million (253) of cash spent in January-September.

      Sonera SmartTrust’s revenues decreased to €5 million (10) in the third quarter mainly due to the lack of larger deliveries during the quarter. Sonera SmartTrust’s underlying EBITDA loss decreased to €3 million (loss of €4 million). At the end of September, Sonera SmartTrust’s order backlog was €19 million.

      In July 2002, Sonera entered into an agreement to sell a slightly greater than 50% interest in SmartTrust AB to a group of private equity investors for a total consideration of €35 million. After the transaction was completed in October 2002, Sonera’s interest in SmartTrust AB decreased to below 50% and Sonera will account for its remaining interest in SmartTrust AB under the equity method of accounting.

      Sonera Zed’s revenues grew to €12 million (7) in the third quarter. Underlying EBITDA loss narrowed significantly to €2 million (loss of €30 million). Sonera estimates that the underlying EBITDA loss of Sonera Zed will be clearly below €20 million for the full year 2002, as compared to a loss of €129 million in 2001.

      In August 2002, Sonera completed the sale of a 15% interest in its former wholly owned subsidiary Sonera Zed to Yahoo! Inc. The transaction was effected through a primary issue of new Sonera Zed shares to Yahoo! Pursuant to the terms of the investment agreement, Yahoo! has the right to purchase up to 100% of Sonera Zed over the next two years, at a price to be determined by Sonera Zed’s operational performance, or withdraw from the transaction. Sonera did not record a significant gain from the sale.

      Sonera Plaza’s revenues amounted to €14 million (11) in the third quarter. Underlying EBITDA loss narrowed to €1 million (loss of €5 million). The number of Sonera Internet subscriptions in Finland totaled approximately 262,000 at the end of September.

      Sonera Juxto’s revenues were €15 million (18) in the third quarter and underlying EBITDA loss was €2 million (loss of €3 million).

      Other units within the business area, primarily related to Sonera’s Corporate Research & Development activities, recorded mostly intra-Group revenues of €21 million (16) and the underlying EBITDA loss narrowed to zero (loss of €1 million) during the third quarter.

Increasing interest in broadband services creates future potential for Sonera Telecom

		July-				July-
		September				September				Change,
		2002				2001				%
		(EUR million)
Revenues			233				255				(9	)
Underlying EBITDA			44				64				(31	)
Underlying EBITDA margin, %			18.9				25.1
Reported operating profit			17				30				(43	)
Capital expenditures			29				30				(3	)
Equity income in associated companies, before goodwill amortization			5				7				(29	)
Equivalent access lines at the end of the period, thousands			729				760				(4	)
Residential broadband subscriptions at the end of the period, thousands			48				4				n/m

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      Revenues from Sonera Telecom were €233 million (255) during the third quarter, decreasing by 9% mainly due to the sale of Primatel and the Gateway leasing business at the end of May 2002. On a comparable basis, however, revenues increased by 2% when taking into account disposals of businesses.

      Underlying EBITDA for the business area decreased to €44 million (64) in the third quarter, primarily due to the revised revenue sharing of mobile international call revenues between Sonera Telecom and Mobile Communications Finland from the beginning of 2002 and the sale of Primatel and Gateway operations. Underlying EBITDA, however, improved when compared to the second quarter of 2002. The reported operating profit was €17 million (30) and the underlying operating profit was €16 million (36). Capital expenditure for the business area was reduced to €29 million (30) during the third quarter.

      Revenues for the nine months January-September decreased by 3% to €740 million (760). The growth in comparable revenues was 4% in January-September, taking into account disposals of businesses. Underlying EBITDA for January-September was €137 million (173). The reported operating profit was €86 million (84) and the underlying operating profit was €46 million (81) in January-September. Capital expenditures for January-September were reduced to €78 million (115). The simplified free cash flow measure as applied to Sonera’s business areas, underlying EBITDA less capital expenditure, therefore improved slightly to €59 million (58) in January-September.

      In the third quarter, revenues from domestic voice services fell 9% to €49 million (54) as local lines and domestic call minutes declined further. Traffic was reduced due to ADSL and other broadband connections replacing the dial-up Internet traffic.

      Revenues from international calls decreased by 14% and were €36 million (42) in the third quarter. Though international transit traffic continued to increase, revenues declined due to the revised revenue sharing with Mobile Communications Finland.

      Revenues from data services remained at the level of last year and totaled €38 million (38) in the third quarter. Growth in revenues was impeded by general price erosion. The number of ADSL and other broadband consumer connections continued to show strong growth and totaled 47,918 at the end of September (4,374). Leased lines revenues amounted to €14 million (15).

      In September, a survey conducted by Suomen Gallup showed that Sonera is the market leader among the providers of broadband access, with a market share of 36%. The Sonera broadband subscription has Finland’s widest availability area: it is currently available at over 200 localities. In the third quarter, Sonera also signed agreements to provide a total of 30,000 broadband connections to the housing stock of various real estate firms. Each resident can decide whether to connect to the service or not. In August, Sonera completed the installation of Finland’s largest broadband local area network for the Student Housing Foundation of Helsinki, providing broadband access to approximately 15,000 students, with the monthly charge included in the rent of the apartment.

      In the third quarter, revenues from equipment sales decreased to €29 million (35) primarily due to the sale of the Gateway leasing business at the end of May 2002.

      Sonera’s equity income in its Baltic and Finnish fixed network associated companies totaled €5 million (7) in the third quarter. The estimated number of subscriptions of the associated companies totaled approximately 2.3 million at the end of September.

Legal and regulatory developments

      In July 2002, the Supreme Administrative Court accepted an appeal that Sonera filed in January against the Competition Council’s decision to prohibit Sonera’s acquisition of 16.7% in Loimaan Seudun Puhelin Oy (LSP). After the Supreme Administrative Court’s decision, Sonera will start taking the measures required by the initial approval by the Finnish Competition Authority in August 2001. Sonera’s current holding in LSP is 29.1%.

      In July 2002, the Finnish Communications Regulatory Authority (FICORA) issued its decision on a complaint filed by Telepohja Oy in January 2000 concerning the pricing of Sonera’s leased line operations

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      In August 2002, a settlement was reached in respect of the dispute between Sonera and Harri Vatanen, former CEO of Sonera SmartTrust Ltd, about the Sonera SmartTrust technology and the termination of Mr. Vatanen’s employment. The parties agreed to terminate all pending legal actions in full.

      In September 2002, the Administrative Court of Helsinki issued a decision on the appeal filed by Sonera against the decision issued in April 2001 by the Finnish Communications Regulatory Authority (FICORA, formerly the Telecommunications Administration Centre). The Administrative Court of Helsinki stated that the FICORA’s opinion of Sonera’s interconnection pricing in domestic mobile communications not being reasonable in relation to the actual costs would not be considered erroneous. Sonera will appeal the decision to the Supreme Administrative Court. The decision issued by the FICORA in April 2001 is not enforceable until the Supreme Administrative Court has issued its decision. Sonera believes that the correct price level for interconnection traffic should be based on commercially negotiated solutions. In the spring and summer of 2001, Sonera concluded new mobile interconnection agreements with all mobile network operators in Finland. The interconnection fees of Sonera’s mobile communications are lower than those of other Finnish operators and are also low in international comparison. A similar case is also pending at the Finnish Competition Authority.

Clearly improved free cash flow is the basis for Sonera’s dividend policy

      Cash provided by operating activities in the third quarter more than doubled to €220 million (84). Cash from operating activities was improved by higher underlying EBITDA, lower interest expenses and also by a €21 million tax refund. Cash paid for net interest expenses reduced significantly to €16 million (53) in the third quarter as a result of lower net debt. Dividends received from associated companies totaled €10 million (13) in the third quarter.

      Capital expenditures on fixed assets decreased by 33% to €63 million (94) during the third quarter. Free cash flow (cash from operating activities less capital expenditure on fixed assets) improved to €157 million in the third quarter from the negative free cash flow of €10 million in the third quarter of 2001. For the nine months January-September, free cash flow amounted to €339 million, as compared to negative free cash flow of €160 million in the corresponding period in 2001.

      Free cash flow is also the basis for Sonera’s dividend policy, according to which the objective of the Board of Directors is for the amount of dividends paid to correspond to approximately one-fourth of the Group’s annual free cash flow.

      Equity investments and shareholder loans granted also remained lower than last year at €32 million (106) in the third quarter. The largest individual equity investment during the quarter was the remaining payment of €52 million for the Fintur acquisition in August, less cash acquired of €18 million. The first part of the purchase price was paid in advance in the first quarter of 2002.

      During the third quarter, Sonera received proceeds of €25 million (768) from asset sales.

Net debt remains at €2.1 billion after Fintur acquisition

      Net debt decreased slightly in the third quarter of 2002, despite the assuming of Fintur’s net debt of approximately €125 million, and totaled €2,132 million on September 30, 2002 (€2,142 million on June 30, 2002 and €4,494 million on September 30, 2001).

      As of September 30, 2002, Sonera’s net debt-to-underlying EBITDA ratio (trailing twelve-month underlying EBITDA) was 2.9, slightly down from the 3.0 as of June 30, 2002.

      Cash and short-term investments totaled €647 million and available undrawn committed revolving credit facilities totaled €11 million at the end of the third quarter.

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      In August, Sonera repaid €500 million of EMTN Floating Rate Notes with its cash funds. The amount of Sonera’s short-term loans at the end of September was €150 million, and the amount of long-term loans falling due during the next twelve months was €383 million. Sonera intends to finance the repayments of the loans mainly with its cash funds, available undrawn committed revolving credit facilities and cash flow from operations.

      The current long-term and short-term ratings of BBB/A-2 by Standard & Poor’s and Baa2/ Prime-2 by Moody’s are all under review for a possible upgrade.

      As of September 30, 2002, the equity-to-assets ratio increased to 37% from 33% on June 30, 2002, as a consequence of debt repayments and an increase in shareholders’ equity. The equity-to-assets ratio is estimated to rise to approximately 40% by the end of the year.

      On September 30, 2002, Sonera’s shareholders’ equity totaled €1,921 million, consisting of €1,338 of restricted equity and €583 million of non-restricted equity. As of September 30, 2002, the distributable funds in Sonera’s consolidated shareholders’ equity totaled €428 million.

Sonera share

      Sonera’s share price has closely followed the price of the Telia AB share since the two companies announced their plans to merge in March 2002, and the average price for the third quarter declined by 14% compared to the average price for the second quarter.

      On the first trading day of the third quarter, the closing price of the Sonera share on Helsinki Exchanges was €3.98, while on the last trading day of the quarter it was €3.75. During the third quarter, the share had a low of €3.19 and a high of €4.91 on Helsinki Exchanges, and the average trading price was €4.10. At the end of September, Sonera’s market capitalization was €4,182 million.

      In the third quarter, the trading volume of Sonera shares on Helsinki Exchanges was 194 million shares (209), with the total traded value of €795 million (892). On Nasdaq, the trading volume in the third quarter was 1.4 million shares (5.0), with the total traded value of US$5.4 million (20).

      The Company’s Board of Directors does not have a valid authorization to issue shares, convertible bonds or to launch a stock option scheme. The Board of Directors has the authorization to repurchase a maximum of two million Sonera Corporation shares in public trading. At the end of September, the Company had 550,000 Sonera shares in its own possession.

Investigations relating to Sonera’s write-down of UMTS investments

      Shortly after the write-downs relating to Sonera’s investments in Group 3G and Ipse 2000 were publicly announced in July 2002, the Finnish Ministry of Transport and Communications commenced an investigation into the Ministry’s involvement in Sonera’s decision to bid in the third generation license auctions in Germany and Italy. On August 5, 2002, the Ministry concluded the investigation, finding that neither the Ministry, the minister nor any other state body had taken any formal decisions concerning Sonera’s decision to bid in such auctions. On August 7, 2002, the Finnish Chancellor of Justice launched a separate investigation, the results of which were announced on October 8, 2002. According to the findings, the Finnish government or its individual members have not participated in Sonera’s UMTS decisions, and the members of the government and the civil servants at the Ministry of Transport and Communications have not breached their official duty or acted in an otherwise illegitimate manner in connection with the UMTS decisions. Both of these investigations related to the Finnish State’s own decision-making process in relation to state-controlled companies, in this case Sonera, and not to any decision-making process within Sonera itself. Accordingly, Sonera’s management does not believe the investigations, or any action taken in response thereto, will have a material effect on Sonera.

      On August 22, 2002, Sonera announced the results of an extensive internal examination on anonymous malpractice claims. An anonymous writing circulated on the Internet claimed that there had been malpractices associated with the settlement of the Company’s consulting invoices in 1999-2001 and that the Company’s

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      In August, the Company’s Board of Directors also requested the independent external auditors of the Company to conduct a review of the Interim Report of June 30, 2002, with special emphasis on the accounting practice and the valuation of deferred tax asset. On the basis of the review conducted by the independent auditors, nothing has come to their attention that causes them to believe that the Interim Report of June 30, 2002 would not give a true and fair view of the financial status of the Company.

      In August, Sonera also received inquiries by the Finnish Financial Supervision Authority (FFSA) in relation to the timing of announcing the UMTS write-downs, the deferred tax asset recorded from the write-downs, and the Finnish Government’s decision in principle on its ownership policy. Sonera has responded to these inquiries and the FFSA has informed Sonera that no further measures are necessary.

      As a result of its €4,280 million write-down of its UMTS investments in Germany and Italy, Sonera recorded a deferred tax benefit of €1,235 million in the second quarter of 2002. Although Sonera currently estimates that the deferred tax asset can be realized in six to eight years under different scenarios, there can be no assurance of sufficient taxable income within this period. Tax loss carry-forwards in Finland expire after ten years. For the nine months ended September 30, 2002, Sonera’s estimated taxable income in Finland, before non-recurring gains and losses, was approximately €350 million.

Exchange Offer for the merger of Sonera and Telia starts in October

      On March 26, 2002, Sonera and Telia AB of Sweden announced a plan to merge. On July 10, 2002, the two companies received an approval of the merger by the European Commission. In its approval, the EU Commission conditioned the merger on the following commitments by Telia and Sonera:

	•	Telia has committed to sell its mobile operations, dealership chain and wireless LAN business in Finland. In addition, the combined company has agreed to provide to the purchaser of Telia’s mobile

	•	Telia has committed to sell its Com Hem AB cable TV business and related network in Sweden.
	•	The combined company has committed to ensure that its fixed and mobile network businesses in Sweden and Finland are held in separate legal entities, which are distinct from related retail activities. The network companies’ Boards of Directors will include an external director appointed according to corporate law. This commitment can be revised after five years.
	•	The combined company has committed to make available to telecommunications operators in Sweden and Finland its regulated wholesale fixed and mobile network products and international GSM roaming in Sweden and Finland on a nondiscriminatory basis compared to the terms on which they are offered internally within the combined company. Pertaining to the roaming product, the combined company will have the right to require reciprocity in respect of prices, quality and other conditions. This obligation to provide services on a non- discriminatory basis is in force for a period of three years and will be subject to a fast-track dispute resolution procedure by arbitration.

      Sonera and Telia estimate that the conditions set by the EU will have only a minor effect on the combined company’s results of operations, financial condition and cash flows.

      In the first six months of 2002, on a pro forma basis, the combined TeliaSonera would have reported revenues of €4.4 billion, underlying EBITDA of €1.3 billion, underlying EBITDA margin of 30.5%, and an operating loss of €0.3 billion.

      Telia’s exchange offer to Sonera’s shareholders commenced on October 7, 2002.

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Sonera upgrades the full-year profitability outlook

      Despite the uncertain economic outlook in Sonera’s main market areas, the Group’s comparable revenues, as adjusted for disposals and acquisitions, are estimated to grow in 2002, albeit at a markedly slower rate than in the previous year. Sonera’s underlying EBITDA, however, is estimated to improve by more than one-third from the 2001 level and the EBITDA margin is set to rise to the level of 35% of revenues.

      The growth in revenues from Mobile Communications Finland is estimated to slow down significantly from the figure a year ago and to be markedly less than 5% in 2002. The slowdown in growth is primarily attributable to the delayed availability of the more advanced terminal devices, the new interconnection agreements, SMS price reduction, as well as tightening competition. Underlying EBITDA in euro terms is estimated to be higher than the level of 2001.

      Within Sonera’s International Mobile Communications, the acquisition of control in Fintur in August 2002 will contribute significantly to the overall growth of consolidated revenues in the fourth quarter of 2002. Accordingly, Sonera’s International Mobile Communications is also expected to record a positive underlying EBITDA for the full year 2002.

      Owing to the paring down of the Service Businesses and the disposals carried out, revenues from Service Businesses will decline in 2002. On the other hand, the negative underlying EBITDA contribution from the business area will be limited to a maximum of €50 million in 2002. In 2003 the business area’s underlying EBITDA will reach at least the breakeven level.

      Sonera Telecom’s revenues are expected to remain close to the same level as in 2001. Underlying EBITDA will decline from the level of 2001 primarily due to the sale of Primatel and the Gateway leasing business, revised revenue sharing of mobile international call revenues between Sonera Telecom and Mobile Communications Finland and decreased fixed voice revenues. Underlying EBITDA is estimated to be approximately €180 million.

      Excluding non-recurring items, the consolidated underlying operating profit is estimated to double as compared to 2001. The reported operating profit, however, will be clearly lower than in 2001 due to smaller capital gains and the write-downs recorded in the second quarter of 2002.

      Excluding the Group 3G write-down, Sonera estimates that the underlying equity loss will narrow to a range of €100 million to €150 million for the full year.

      It is estimated that the Group’s cash provided by operating activities will improve significantly in 2002 as underlying EBITDA strengthens and interest expenses diminish. After the acquisition of Fintur, capital expenditures on fixed assets are estimated to be approximately €300 million in 2002. As a result, the simplified free cash flow measure as followed by Sonera (underlying EBITDA, less cash-based interest expenses, less capital expenditures on fixed assets) is estimated to be €350-400 million.

Target for 2003

      Sonera’s consolidated revenues are estimated to grow in 2003 especially due to the consolidation of Fintur for the full year. Sonera’s target is that underlying EBITDA for 2003 will improve from the 2002 level, and that the underlying EBITDA margin will be at least 35% of revenues.

      Sonera’s target for operating profit (excluding any non-recurring items) is significant improvement from the level of 2002 and that the operating profit margin is at least 20% of revenues. As a result, the return on capital employed is targeted to be over 10% and the return on shareholders’ equity about 15%.

Helsinki, Finland

SONERA CORPORATION

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Financial Information

      The financial information given in this interim report is based on Sonera’s unaudited consolidated interim financial statements that are prepared in accordance with Finnish accounting practice. This interim report includes information on “underlying EBITDA” and on other similar “underlying” measures of Sonera’s results of operations. Underlying EBITDA equals operating profit before depreciation and amortization, before gains and losses from sale of shares and fixed assets, before write-downs, and before restructuring expenses. Sonera’s management believes that, except for depreciation and amortization, these items excluded from the definition of underlying EBITDA do not reflect the underlying fundamentals of the operating results from Sonera’s business segments. Sonera’s management also believes that underlying EBITDA is a standard measure commonly reported and widely used by analysts, investors and others in the telecommunications industry. Accordingly, this information has been disclosed to permit a more complete comparative analysis of the segmental operating performance relative to other companies in the industry. Underlying EBITDA, however, should not be considered as an alternative to operating profit as an indicator of operating performance. Similarly, underlying EBITDA should not be considered as an alternative to cash flows from operating activities as a measure of liquidity. Underlying EBITDA is not a measure of financial performance under Finnish GAAP or U.S. GAAP and may not be comparable to other similarly titled measures for other companies. Underlying EBITDA is not meant to be predictive of potential future results.

Forward-Looking Statements

      This interim report contains statements concerning, among other things, Sonera’s financial condition and results of operations that are forward-looking in nature. Such statements are not historical facts but, rather, represent Sonera’s future expectations. Sonera believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions; however, forward-looking statements involve inherent risks and uncertainties, and a number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement, including Sonera’s market position, growth in the telecommunications industry in Europe, the effects of competition and other economic, business, competitive and/or regulatory factors affecting the business of Sonera and the telecommunications industry in general. Forward-looking statements speak only as of the date they were made, and, other than as required by applicable law, Sonera undertakes no obligation to update any of them in light of new information or future events.

Cautionary Disclaimer/ Legend

      The combination of Sonera and Telia will be implemented through an exchange offer being made by Telia to all shareholders of Sonera. The contents of this document are neither an offer to purchase nor a solicitation of an offer to sell shares of Sonera. Any offer in the United States will only be made through a prospectus which is part of a registration statement on Form F-4 which Telia filed with the U.S. Securities and Exchange Commission (the “SEC”) on October 1, 2002. Sonera shareholders who are U.S. persons or are located in the United States are urged to carefully review the registration statement on Form F-4, the prospectus included therein and other documents relating to the offer that Telia has filed or will file with the SEC because these documents contain important information relating to the offer. You are also urged to read the related solicitation/ recommendation statement on Schedule 14D-9 that was filed by Sonera with the SEC on October 1, 2002 regarding the offer. You may obtain a free copy of these documents at the SEC’s web site at www.sec.gov. You may also inspect and copy the registration statement on Form F-4, as well as any documents incorporated by reference therein, and the Schedule 14D-9 at the public reference room maintained by the SEC at 450 Fifth Street, NW, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. These documents may also be obtained free of charge by contacting Telia AB, Investor Relations, SE-12386 Farsta, Sweden. Attention: External Communications or Investor Relations (tel: +46 8 7137143, or Sonera, Teollisuuskatu 15, P.O. Box 106, FIN-00051 SONERA, Finland. Attention: Investor Relations (tel: +358 20401). YOU SHOULD READ THE PROSPECTUS AND THE SCHEDULE 14D-9 CAREFULLY BEFORE MAKING A DECISION CONCERNING THE OFFER.

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Income Statement

		July-				July-				January-				January-								Full
		September				September				September				September				Change				year
		2002				2001				2002				2001				%				2001
		(EUR million)
Revenues			551				549				1,635				1,631				0				2,187
Other operating income			14				9				396				911				(57	)			916
Cost of services and goods			(197	)			(173	)			(554	)			(523	)			6				(708	)
Personnel expenses			(89	)			(112	)			(305	)			(384	)			(21	)			(512	)
Other operating expenses			(94	)			(126	)			(725	)			(394	)			84				(600	)
Depreciation and amortization(1)			(85	)			(84	)			(246	)			(252	)			(2	)			(332	)
Operating profit			100				63				201				989				(80	)			951
Equity income in associated companies			5				(41	)			(3,974	)			(135	)							(202	)
Sales and write-downs of short-term investments			—				(366	)			(43	)			(366	)							(272	)
Financial income and expenses			(28	)			(8	)			(16	)			(35	)							(32	)
Profit before income taxes and minority interest			77				(352	)			(3,832	)			453				(946	)			445
Income taxes			(27	)			28				1,219				(100	)							(35	)
Minority interest			(3	)			(1	)			(3	)			—								(1	)
Net income			47				(325	)			(2,616	)			353				(841	)			409
Average number of shares (1,000 shares)			1,114,752				906,091				1,114,752				906,091				23				924,346
Diluted average number of shares (1,000 shares)			1,114,752				906,091				1,114,752				906,091				23				924,346
Earnings per share (euros)			0.04				(0.35	)			(2.35	)			0.39				(703	)			0.44
Diluted earnings per share (euros)			0.04				(0.35	)			(2.35	)			0.39				(703	)			0.44
Underlying EBITDA(2)			199				183				585				407				44				562
Underlying EBITDA-margin (%)			36				33				36				25								26

(1)		In 2000, Sonera recorded the acquisitions of Across and iD2 in accordance with the interpretation No. 1591/1999 by the Finnish Accounting Board. If fair value had been used to record the transactions, Sonera would have recorded amortization of goodwill of EUR 4 million in July-September 2002 and EUR 213 million in January-September 2002, including an impairment loss of EUR 209 million (EUR 17 million in July-September 2001, EUR 52 million in January-September 2001 and EUR 69 million for the full year 2001).
(2)		Underlying EBITDA equals operating profit before depreciation and amortization, before gains and losses from sale of shares and fixed assets, before write-downs, and before restructuring and other non-recurring expenses.

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Underlying Results (Excluding Non-recurring Income and Expenses)

		July-				July-				January-				January-								Full
		September				September				September				September				Change				year
		2002				2001				2002				2001				%				2001
		(EUR million)
Revenues			551				549				1,635				1,631				0				2,187
Other operating income			10				8				22				20				10				26
Cost of services and goods			(197	)			(173	)			(554	)			(523	)			6				(708	)
Personnel expenses			(92	)			(96	)			(295	)			(366	)			(19	)			(488	)
Other operating expenses			(73	)			(105	)			(223	)			(355	)			(37	)			(455	)
Depreciation and amortization(1)			(85	)			(84	)			(246	)			(252	)			(2	)			(332	)
Underlying operating profit			114				99				339				155				119				230
Equity income in associated companies			5				(41	)			(130	)			(135	)			(4	)			(202	)
Financial income and expenses			(28	)			(8	)			(16	)			(35	)			54				(32	)
Underlying profit before income taxes and minority interest			91				50				193				(15	)			1,387				(4	)
Income taxes			(33	)			5				(24	)			6				—				68
Minority interest			(3	)			(1	)			(3	)			—								(1	)
Underlying net income			55				54				166				(9	)			1,944				63
Underlying earnings per share (euros)			0.05				0.06				0.15				(0.01	)			1,600				0.07
Diluted earnings per share (euros)			0.05				0.06				0.15				(0.01	)			1,600				0.07
Underlying EBITDA			199				183				585				407				44				562
The following non-recurring income and expenses have been excluded from the underlying results:
Gains from sale of shares and fixed assets			5				1				374				891								890
Restructuring and other non-recurring expenses			(6	)			(16	)			(36	)			(33	)							(45	)
Losses from sale of shares and fixed assets, and write-downs of shares			(13	)			(21	)			(40	)			(24	)							(124	)
Write-downs of UMTS investments			—				—				(4,280	)			—								—
Sales and write-downs of short-term investments			—				(366	)			(43	)			(366	)							(272	)
Tax effect of non-recurring income and expenses			6				23				1,243				(106	)							(103	)
Total			(8	)			(379	)			(2,782	)			362								346

(1)		In 2000, Sonera recorded the acquisitions of Across and iD2 in accordance with the interpretation No. 1591/1999 by the Finnish Accounting Board. If fair value had been used to record the transactions, Sonera would have recorded amortization of goodwill of EUR 4 million in July-September 2002 and EUR 213 million in January-September 2002, including an impairment loss of EUR 209 million (EUR 17 million in July-September 2001, EUR 52 million in January-September 2001 and EUR 69 million for the full year 2001).

      Income and expenses in the underlying results have not been adjusted with the effects of businesses sold and acquired.

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Balance Sheet

		September 30,				September 30,				Dec. 31,
		2002				2001				2001
		(EUR million)
Fixed assets and other long-term investments
Intangible assets			266				110				98
Property, plant and equipment			1,423				1,280				1,269
Long-term investments and receivables			1,572				5,874				6,068
Deferred tax asset			1,150				—				—
Total			4,411				7,264				7,435
Current assets
Inventories			15				38				33
Current loans receivable			1				66				45
Other current receivables			504				725				565
Short-term investments			552				1,005				620
Cash and cash equivalents			95				77				96
Total			1,167				1,911				1,359
TOTAL ASSETS			5,578				9,175				8,794
Shareholders’ equity			1,921				3,558				4,575
Minority interest			114				16				13
Non-current liabilities
Long-term debt			2,246				3,783				2,007
Other long-term liabilities			229				69				148
Total			2,475				3,852				2,155
Current liabilities
Current debt			150				314				55
Current portion of long-term debt			383				814				1,418
Other current liabilities			535				621				578
Total			1,068				1,749				2,051
TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES			5,578				9,175				8,794

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Statement of Cash Flows

		July-				July-				January-				January-
		September				September				September				September				Full year
		2002				2001				2002				2001				2001
		(EUR million)
Cash provided by operating activities
Net income			47				(325	)			(2,616	)			353				409
Depreciation and amortization			85				84				246				252				332
Write-downs of UMTS investments			—				—				4,280				—				—
Gain from sale of Pannon shares			—				—				(220	)			—				—
Gain from sale of Sonera Info Communications			—				—				(90	)			—				—
Other (gains) losses from sale of shares and fixed assets			—				1				(55	)			(889	)			(883	)
Equity (income) loss in associated companies			(5	)			41				130				135				202
Sales and write-downs of short-term investments			—				378				43				378				272
Deferred tax expense (benefit)			27				(72	)			(1,230	)			(101	)			(17	)
Change in working capital and other items			66				(23	)			21				(22	)			(118	)
Total			220				84				509				106				197
Cash (used in) provided by investing activities
Capital expenditures			(63	)			(94	)			(170	)			(266	)			(359	)
Investments in shares and shareholder loans			(32	)			(106	)			(155	)			(497	)			(572	)
Proceeds from sale of shares and fixed assets			25				768				1,023				1,943				2,193
Change in short-term investments and other items			405				(225	)			(370	)			(342	)			(39	)
Total			335				343				328				838				1,223
Cash provided by (used in) by financing activities
Change in long-term debt			(592	)			1,579				(900	)			2,501				1,476
Change in current debt			52				(2,010	)			65				(3,388	)			(3,793	)
Equity issue			—				—				—				—				973
Dividends paid			—				—				—				(67	)			(67	)
Sale of rights related to treasury shares			—				—				—				—				1
Total			(540	)			(431	)			(835	)			(954	)			(1,410	)
Effect of exchange rate changes			(2	)			(3	)			(3	)			(1	)			(2	)
Change in cash and cash equivalents			13				(7	)			(1	)			(11	)			8

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Cash Provided by Operating Activities Under the Direct Method Presentation

		July-				July-				January-				January-				Full
		September				September				September				September				year
		2002				2001				2002				2001				2001
		(EUR million)
Payments received from customers			550				543				1,646				1,669				2,232
Payments to suppliers			(261	)			(312	)			(881	)			(1,067	)			(1,369	)
Payments to personnel			(87	)			(88	)			(254	)			(301	)			(397	)
Total			202				143				511				301				466
Dividends received			10				13				41				35				47
Interest income received			6				5				16				15				21
Interest expenses paid			(22	)			(58	)			(86	)			(233	)			(299	)
Income taxes refunded (paid)			19				(23	)			22				(15	)			(41	)
Other items			5				4				5				3				3
Cash provided by operating activities			220				84				509				106				197

Equity Income in Associated Companies

		July-				July-				January-				January-								Full
		September				September				September				September								year
		2002				2001				2002				2001				Change				2001
		(EUR million)
Turkcell Iletisim Hizmetleri A.S			1				(16	)			(17	)			(49	)			32				(61	)
Fintur Holdings B.V			(3	)			(18	)			(49	)			(78	)			29				(96	)
Other GSM operators			15				18				31				43				(12	)			56
UMTS associated companies			—				(16	)			(77	)			(28	)			(49	)			(79	)
Fixed network operators			5				7				19				23				(4	)			35
Other associated companies			—				(2	)			4				(2	)			6				2
Write-down of Group 3G			—				—				(3,844	)			—				(3,844	)			—
Amortization of goodwill			(13	)			(14	)			(41	)			(44	)			3				(59	)
Total			5				(41	)			(3,974	)			(135	)			(3,839	)			(202	)

Financial Income and Expenses

		July-				July-				January-				January-								Full
		September				September				September				September								year
		2002				2001				2002				2001				Change				2001
		(EUR million)
Dividend income			—				—				—				12				(12	)			14
Interest income(1)			7				43				73				139				(66	)			183
Interest expenses			(33	)			(70	)			(108	)			(228	)			120				(279	)
Capitalized interest expenses			1				13				24				40				(16	)			52
Other financial income and expenses			(2	)			3				(4	)			1				(5	)			1
Exchange rate gains and losses			(1	)			3				(1	)			1				(2	)			(3	)
Total			(28	)			(8	)			(16	)			(35	)			19				(32	)

(1)		Interest income includes non-cash interest income from Group 3G UMTS Holding GmbH totaling EUR 51 million January-September 2002 (EUR 34 million in July-September 2001, EUR 118 million in January-September 2001 and EUR 154 million in January-December 2001). In July-September 2002, there was no interest income from Group 3G UMTS Holding GmbH.

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Changes in Shareholders’ Equity

		September 30,				September 30,				Dec. 31,
		2002				2001				2001
		(EUR million)
Shareholders’ equity on January 1			4,575				3,233				3,233
Equity issue			—				—				982
Dividends paid			—				(67	)			(67	)
Sale of rights related to treasury shares			—				—				2
Currency translation adjustment			(38	)			39				16
Net income			(2,616	)			353				409
Shareholders’ equity on Sept. 30/Dec. 31			1,921				3,558				4,575

Commitments and Contingent Liabilities

			September 30,				Dec. 31,
			2002				2001
			(EUR million)
Assets pledged
	To secure own commitments			6				6
	To secure borrowings of subsidiaries(1)			33				—
	To secure borrowings of associated companies(2)			4				24
Guarantees on behalf of associated companies for financing				57				35
Guarantees on behalf of other companies Guarantees on behalf of Xfera Móviles S.A.				411				428
	Guarantees on behalf of Ipse 2000 S.p.A			37				180
Minimum operating lease payments				266				264
Other commitments				93				31

(1)		Pledges given as a security for the loans of the Fintur companies. Sonera is currently in the process of refinancing the majority of loans of the Fintur companies with Group-internal financing, after which the pledges will be released.
(2)		Carrying values of the pledged shares in associated companies. The maximum liability according to the loan amounts secured totals EUR 25 million (December 31, 2001: EUR 23 million).

Derivative Financial Instruments

		September 30,				September 30,				September 30,				December 31,
		2002				2002				2002				2001
		Contract amount				Carrying value				Fair value				Fair value
		(EUR million)
Forward foreign exchange contracts			254				1				1				(1	)
Interest rate swaps			1,640				14				30				41
Purchased interest rate options			200				—				—				—

      Derivative instruments are used in hedging foreign exchange and interest rate risks.

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Capital Expenditure on Fixed Assets

		July-				July-				January-				January-								Full
		September				September				September				September				Change				year
		2002				2001				2002				2001				%				2001
		(EUR million)
Mobile Communications Finland			22				25				63				75				(16	)			102
International Mobile Communications			5				—				5				—				100				—
Service Businesses			1				23				9				50				(82	)			53
Sonera Telecom			29				30				78				115				(32	)			186
Other Operations			6				16				15				26				(42	)			18
The Group			63				94				170				266				(36	)			359

Average Number of Personnel

		July-				July-				January-				January-								Full
		September				September				September				September				Change				year
		2002				2001				2002				2001				%				2001
		(EUR million)
Mobile Communications Finland			1,664				1,671				1,629				1,627				0				1,792
International Mobile Communications			242				—				123				—				100				—
Service Businesses			1,791				2,734				2,123				2,850				(26	)			2,728
Sonera Telecom			3,221				4,947				3,851				5,007				(23	)			4,795
Other Operations			494				1,090				450				1,420				(68	)			1,167
The Group			7,412				10,442				8,176				10,904				(25	)			10,482

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Business Areas

			July-				July-				January-				January-								Full
			September				September				September				September				Change				year
			2002				2001				2002				2001				%				2001
			(EUR million)
Revenues
Mobile Communications Finland				312				307				932				907				3				1,213
International Mobile Communications				25				(1	)			25				3				—				4
Service Businesses
	Sonera SmartTrust			5				10				22				21				5				36
	Sonera Zed			12				7				30				14				114				21
	Sonera Info Communications			—				14				20				53				(62	)			71
	Sonera Plaza			14				11				44				39				13				53
	Sonera Juxto			15				18				48				52				(8	)			72
	Other Services			21				16				49				54				(9	)			68
	Total			67				76				213				233				(9	)			321
Sonera Telecom
	Domestic Voice Services			49				54				158				169				(7	)			222
	International Voice Services			36				42				109				115				(5	)			149
	Data Services			38				38				118				117				1				151
	Leased Lines			14				15				44				42				5				56
	Equipment Sales			29				35				89				91				(2	)			118
	Construction and Maintenance			—				8				10				21				(52	)			35
	Sales to other segments and other products			67				63				212				205				3				293
	Total			233				255				740				760				(3	)			1,024
Other Operations				19				34				60				79				(24	)			113
Intra-Group sales				(105	)			(122	)			(335	)			(351	)			5				(488	)
The Group				551				549				1,635				1,631				0				2,187
Underlying EBITDA
Mobile Communications Finland				162				158				473				463				2				604
International Mobile Communications				9				(5	)			6				(10	)			160				(14	)
Service Businesses
	Sonera SmartTrust			(3	)			(4	)			(12	)			(35	)			66				(40	)
	Sonera Zed			(2	)			(30	)			(11	)			(107	)			90				(129	)
	Sonera Info Communications			—				(5	)			3				2				50				9
	Sonera Plaza			(1	)			(5	)			(4	)			(25	)			84				(33	)
	Sonera Juxto			(2	)			(3	)			(5	)			(13	)			62				(14	)
	Other Services			0				(1	)			(2	)			(25	)			92				(37	)
	Total			(8	)			(48	)			(31	)			(203	)			85				(244	)
Sonera Telecom				44				64				137				173				(21	)			230
Other Operations				(8	)			14				0				(16	)			100				(14	)
The Group				199				183				585				407				44				562
Operating profit
Mobile Communications Finland				132				126				380				368				3				477
International Mobile Communications				5				(17	)			(201	)			573				—				569
Service Businesses
	Sonera SmartTrust			(6	)			(8	)			(39	)			(45	)			13				(63	)
	Sonera Zed			(6	)			(39	)			(25	)			(126	)			80				(182	)
	Sonera Info Communications			—				—				93				6				—				5
	Sonera Plaza			(3	)			(9	)			(11	)			(33	)			67				(57	)
	Sonera Juxto			(2	)			(6	)			(10	)			(20	)			50				(25	)
	Other Services			(3	)			(9	)			(6	)			(35	)			83				(62	)
	Total			(20	)			(71	)			2				(253	)			101				(384	)
Sonera Telecom				17				30				86				84				2				108
Other Operations				(34	)			(5	)			(66	)			217				(130	)			181
	The Group			100				63				201				989				(80	)			951

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Other Data

			July-				July-				January-				January-								Full
			September				September				September				September				Change				year
			2002				2001				2002				2001				%				2001
Number of subscriptions at end of period
Mobile Communications Finland
	GSM subscriptions(1)											2,472,552				2,398,087				3				2,421,533
	NMT subscriptions											28,106				42,681				(34	)			38,250
	Service provider subscriptions in Sonera’s network											37,408				54,041				(31	)			50,245
	Total											2,538,066				2,494,809				2				2,510,028
	GSM customer churn (%, annualized)(2)			11.0				9.5				11.3				9.7								10.1
Fintur GSM subscriptions
	Prepaid											1,223,053				810,646				51				902,528
	Advanced and post paid											279,392				250,344				12				225,691
	Total											1,502,445				1,060,990				42				1,128,219
Fixed network access lines in Finland(3)												729,268				760,083				(4	)			753,140
Traffic and use
	Mobile Communications Finland
	Outgoing minutes (in millions)			1,146				1,087				3,333				3,137				6				4,215
	Avg. monthly use per subscription (minutes)			153				149				150				146				3				145
	Avg. monthly revenue per subscription (euros)			40.3				40.7				40.2				40.7				(1	)			40.5
	SMS messages (millions of messages)			197				185				581				541				7				744
	Avg. monthly SMS messages sent per subscription			26.7				25.8				26.5				25.7				3				26.4
	Avg monthly user activity for SMS messages (% of customers)			74				72				74				71				4				72
	Avg monthly user activity for content services (% of customers)			31				33				31				33				(7	)			33
Fixed network in Finland (minutes in millions)
	Local calls and network compensations			836				900				2,693				2,921				(8	)			3,889
	Long-distance calls			111				118				351				390				(10	)			518
	International calls			55				57				168				174				(3	)			232

(1)		Excluding subscriptions of service providers.
(2)		Excluding cases with new subscription owner, but the same user as before.
(3)		ISDN lines are counted as two standard lines and 2 Mbps lines are counted as 30 standard lines.

Pro Forma Consolidation of Fintur

      The following pro forma consolidated income statement information presents the acquisition of controlling interest in Fintur as if the transaction had taken place already on January 1, 2001. This

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															Profit before
															income
															taxes and								Earnings
							Underlying				Operating				minority				Net				per
			Revenues				EBITDA				profit				interest				income				share
			(EUR million)
July-September 2002
	Sonera (reported)			551				199				100				77				47				0.04
	Fintur (July-August 2002)			49				25				16				14				5
	Pro forma adjustments(1)			—				—				(2	)			1				(2	)
	Pro forma consolidated			600				224				114				92				50				0.05
	% of revenues							37.3				19.0
July-September 2001
	Sonera (reported)			549				183				63				(352	)			(325	)			(0.35	)
	Fintur			55				25				10				7				(1	)
	Pro forma adjustments(1)			—				—				(2	)			16				16
	Pro forma consolidated			604				208				71				(329	)			(310	)			(0.34	)
	% of revenues							34.4				11.8
January-September 2002
	Sonera (reported)			1,635				585				201				(3,832	)			(2,616	)			(2.35	)
	Fintur (January-August 2002)			166				82				48				35				4
	Pro forma adjustments(1)			—				—				(7	)			43				42
	Pro forma consolidated			1,801				667				242				(3,754	)			(2,570	)			(2.31	)
	% of revenues							37.0				13.4
January-September 2001
	Sonera (reported)			1,631				407				989				453				353				0.39
	Fintur			140				48				13				3				(14	)
	Pro forma adjustments(1)			—				—				(7	)			71				76
	Pro forma consolidated			1,771				455				995				527				415				0.46
	% of revenues							25.7				56.2

(1)		Pro forma adjustments consist of the preliminary estimated amortization of goodwill, the reversal of equity method of accounting for Fintur, and the recording of minority interest in income of Fintur.

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APPENDIX: INFORMATION ON SONERA’S DEBT

Total loan portfolio

      Sonera’s long-term and short-term debt (including capital lease obligations) amounted to €2,779 million as of September 30, 2002, which includes €131 million of long-term and short-term loans in the Fintur companies. The average interest rate of debt by Sonera Corporation and its fully owned subsidiaries was approximately 4.64 percent (including the impact of hedging measures). The average interest rate of the Fintur loans was approximately 10.13 percent. Sonera is currently in the process of refinancing the majority of loans of the Fintur companies with Group-internal financing.

Loans from financial institutions

	•	€86 million term loans, due on November 6, 2008, which bear a variable interest rate based on LIBOR (3.65 percent on September 30, 2002);
	•	€50 million term loan, due on December 11, 2003, which bears a variable interest rate based on Euribor (3.49 percent on September 30, 2002);
	•	€511 million syndicated revolving credit facility, due in semiannual installments commencing on April 27, 2003 and final maturity on April 27, 2005 with a variable interest rate based on LIBOR (3.82 percent on September 30, 2002). €500 million was drawn out of the facility as of September 30, 2002; and
	•	€92 million syndicated revolving credit facility, due in semiannual installments commencing on March 17, 2003 and final maturity on March 17, 2004, with a variable interest rate based on LIBOR (3.67 percent on September 30, 2002). The facility was fully drawn as of September 30, 2002.
	•	€131 million loans taken by the Fintur companies in various currencies, maturing between October 10, 2002 and August 1, 2005 (average interest rate 10.13 percent on September 30, 2002).
	•	Other loans totaling €7 million.

€3,000 million Euro Medium Term Note (EMTN) program

      Sonera has a €3,000 million EMTN program, under which Sonera currently has total borrowings of €1,800 million. The securities issued under the program include:

	•	€300 million 4.63 percent Fixed Rate Notes due on April 16, 2009;
	•	€1,000 million 5.63 percent Fixed Rate Notes due on March 14, 2005;
	•	€300 million Floating Rate Notes due on June 7, 2004 (4.19 percent on September 30, 2002); and
	•	€200 million 5.13 percent Fixed Rate Notes due on February 17, 2003.

€500 million Euro Commercial Paper program and €500 million domestic Commercial Paper program

	•	€24 million of Euro Commercial Paper issue maturing on April 15, 2003 (interest rate 4.48 percent on September 30, 2002);
	•	€41 million of domestic Commercial Paper issues maturing on December 16, 2002 (average interest rate 4.25 percent on September 30, 2002).

Capital lease obligations

      As of September 30, 2002, Sonera had capital lease obligations of €48 million (average interest rate 7.36 percent).

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Debt maturities for next 12 months

September 30, 2002
		September 30,				September 30,
		2002				2002
		Long-term				Short-term
		loans				loans				Total
		(EUR million)
October 2002			2				12				14
November 2002			2				7				9
December 2002			2				61				63
January 2003			2				4				6
February 2003			202				3				205
March 2003			39				5				44
April 2003			93				26				119
May 2003			2				—				2
June 2003			2				7				9
July 2003			2				2				4
August 2003			2				8				10
September 2003			33				15				48
Total			383				150				533

Annual debt maturities

		September 30, 2002				September 30, 2002
		Long-term				Short-term
		loans				loans				Total
		(EUR million)
2002 (October-December)			6				80				86
2003			579				70				649
2004			551				—				551
2005			1,107				—				1,107
2006			—				—				—
2007			—				—				—
2008			86				—				86
2009			300				—				300
Total			2,629				150				2,779

Breakdown of debt portfolio

		September 30,				Dec. 31,
		2002				2001
		(EUR million)
Loans from financial institutions			866				1,275
Euro Medium Term Notes			1,800				2,150
Euro Commercial Papers			24				4
Finnish Commercial Papers			41				51
Capital lease obligations			48				—
Total			2,779				3,480

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Forward-Looking Statements

      This press release contains forward-looking statements regarding Telia’s exchange offer to Sonera’s shareholders and warrantholders. Statements that are not strictly historical statements, including statements about Telia’s and Sonera’s beliefs and expectations, constitute forward-looking statements. By their nature, forward-looking statements are subject to risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. Telia and Sonera are under no obligation to, and expressly disclaim such obligation to, update or alter their forward-looking statements, whether as a result of new information, future events or otherwise.

Restrictions on Ability of Certain Persons to Participate in the Exchange Offer

      Due to restrictions under the securities laws of Australia, the Hong Kong Special Administrative Region of the People’s Republic of China, Italy, Japan, New Zealand and South Africa, the exchange offer will not be extended to persons with registered addresses in, and who are residents of, any of Australia, the Hong Kong Special Administrative Region of the People’s Republic of China, Italy, Japan, New Zealand or South Africa.

Cautionary Disclaimer/ Legend

      The combination of Sonera and Telia will be implemented through an exchange offer being made by Telia to all shareholders of Sonera. The contents of this document are neither an offer to purchase nor a solicitation of an offer to sell shares of Telia. Any offer in the United States will only be made through a prospectus which is part of a registration statement on Form F-4 which Telia filed with the U.S. Securities and Exchange Commission (the “SEC”) on October 1, 2002. Sonera shareholders who are U.S. persons or are located in the United States are urged to carefully review the registration statement on Form F-4, the prospectus included therein and other documents relating to the offer that Telia has filed or will file with the SEC because these documents contain important information relating to the offer. You are also urged to read the related solicitation/ recommendation statement on Schedule 14D-9 that was filed by Sonera with the SEC on October 1, 2002 regarding the offer. You may obtain a free copy of these documents at the SEC’s web site at www.sec.gov. You may also inspect and copy the registration statement on Form F-4, as well as any documents incorporated by reference therein, and the Schedule 14D-9 at the public reference room maintained by the SEC at 450 Fifth Street, NW, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. These documents may also be obtained free of charge by contacting Telia AB, Investor Relations, SE-12386 Farsta, Sweden. Attention: External Communications or Investor Relations (tel: +46 8 7137143, or Sonera, Teollisuuskatu 15, P.O. Box 106, FIN-00051 SONERA, Finland. Attention: Investor Relations (tel: +358 20401). YOU SHOULD READ THE PROSPECTUS AND THE SCHEDULE 14D-9 CAREFULLY BEFORE MAKING A DECISION CONCERNING THE OFFER.

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INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 20.     Indemnification of Directors and Officers

      Telia maintains liability insurance for its directors and officers, including insurance against liabilities under the Securities Act.

Item 21.     Exhibits and Financial Statements

(a)  Exhibits as required by Item 601 of Regulation S-K

Exhibit
Number				Exhibit Description
	2.1			Combination Agreement, dated as of March 26, 2002, by and between Telia AB (publ) and Sonera Corporation (attached as Annex A to the exchange offer prospectus).*
	2.2			Amendment to the Combination Agreement, dated as of September 27, 2002, by and between Telia and Sonera (attached as Annex B to the exchange offer prospectus).*
	3.1			English translation of Articles of Association of Telia as amended to date (attached as Annex E to the exchange offer prospectus).*
	3.2			English translation of Articles of Association of TeliaSonera as amended to date (attached as Annex A to the mandatory redemption offer prospectus supplement).
	4.1			Form of American Depositary Receipt representing Telia’s American Depositary Shares each representing five (5) ordinary shares (nominal value SEK 3.20 per share) (included as Exhibit A to Exhibit 4.2 herein).*
	4.2			Form of Deposit Agreement among Telia, Citibank, N.A., as Depositary and the Holders and Beneficial Owners from time to time of American Depositary Receipts evidencing American Depositary Shares representing ordinary shares of Telia (incorporated by reference to Exhibit (a) to the Registration Statement on Form F-6 filed by Telia with the Securities and Exchange Commission on October 1, 2002).*
	4.3			Form of Deposit Agreement among TeliaSonera, Citibank, N.A., as Depositary and the Holders and Beneficial Owners from time to time of American Depositary Receipts evidencing American Depositary Shares representing ordinary shares of TeliaSonera (incorporated by reference to Exhibit (a) to Post-Effective Amendment No. 1 to the Registration Statement on Form F-6 filed by TeliaSonera with the Securities and Exchange Commission on December 9, 2002).
	5.1			Opinion of Mannheimer Swartling Advokatbyra as to the legality of the shares.*
	8.1			Opinion of White & Case LLP as to certain matters of U.S. taxation.*
	10.1			Framework Agreement, dated as of March 15, 2001, between Telia and Telia Mobile AB, and NetCom AB and Tele2 AB.(1) *
	10.2			Shareholder Agreement, dated as of March 15, 2001, between Telia, Telia Mobile AB, NetCom AB and Tele2 AB.(1)*
	10.3			Registration Rights Agreement, dated as of September 27, 2002 between Telia AB and the Kingdom of Sweden.*
	10.4			Registration Rights Agreement, dated as of September 27, 2002 between Telia AB and the Republic of Finland.*
	21.1			Subsidiaries of the Registrant (included in Note 41 to the consolidated financial statements of Telia).*
	23.1			Consent of Mannheimer Swartling Advokatbyra (attached in Exhibit 5.1).*
	23.2			Consent of White & Case LLP (included in Exhibit 8.1).*
	23.3			Consent of Ernst & Young AB.*
	23.4			Consent of KPMG Wideri Oy Ab.*
	23.5			Consent of PricewaterhouseCoopers Sp. Z.o.o.*
	23.6			Consent of Arthur Andersen Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft mbH, an affiliated firm of Ernst & Young International.*
	23.7			Consent of KPMG Cevdet Suner Denetim ve Yeminli Mali Mosavirlik A.S.*

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Exhibit
Number				Exhibit Description
	23.8			Consent of PricewaterhouseCoopers N.V.*
	23.9			Consent of Tapio Hintikka*
	23.10			Consent of Ernst & Young AS.*
	24.1			Powers of Attorney (included as part of the signature pages).
	99.1			Acceptance Form for Sonera shares.*
	99.2			Acceptance Form for Sonera warrants.*
	99.3			Form of Letter of Transmittal.*
	99.4			Form of Notice of Guaranteed Delivery.*
	99.5			Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees.*
	99.6			Form of Letter from Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees to Clients.*
	99.7			Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9.*
	99.8			Form of U.S. Exchange Agency Agreement.*
	99.9			Opinion of Goldman Sachs International (attached as Annex D to the exchange offer prospectus).*
	99.10			Consent of Goldman Sachs International.*
	99.11			Acceptance Form for Sonera shares for the Mandatory Redemption Offer.
	99.12			Acceptance Form for Sonera warrants for the Mandatory Redemption Offer.
	99.13			Form of Letter of Transmittal for the Mandatory Redemption Offer.
	99.14			Form of Notice of Guaranteed Delivery for the Mandatory Redemption Offer.
	99.15			Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees for the Mandatory Redemption Offer.
	99.16			Form of Letter from Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees to Clients for the Mandatory Redemption Offer.
	99.17			Form of Supplementary U.S. Exchange Agency Agreement for the Mandatory Redemption Offer.

(1)		Certain confidential portions of this agreement have been omitted from the filed exhibit under Rule 406 under the Securities Act of 1933. In accordance with this rule, the full text of the agreement has been filed separately with the Securities and Exchange Commission.
*		Previously filed.

Item 22.     Undertakings

      The undersigned Registrant hereby undertakes:

	(1)	that, for purposes of determining any liability under the Securities Act, each filing of Telia’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report to section 15(d) of the Exchange Act) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof;
	(2)	to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means;
	(3)	to arrange or provide for a facility in the U.S. for the purpose of responding to such requests. The undertaking in paragraph (2) above includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request;
	(4)	to supply by means of a post-effective amendment all information concerning a transaction and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective; and

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	(5)	insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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SIGNATURES

      Pursuant to the requirements of the Securities Act of 1933, TeliaSonera AB has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Stockholm, Sweden, on December 18, 2002.

	TELIASONERA AB
	/s/ ANDERS IGEL

	By:

	Name:  Anders Igel
	Title:   President and Chief Executive Officer
	/s/ KIM IGNATIUS

	By:

	Name:  Kim Ignatius
	Title:   Chief Financial Officer

      Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated on December 18, 2002.

      KNOW ALL MEN BY THESE PRESENTS, that each director and executive officer of TeliaSonera AB whose signature appears below constitutes and appoints Anders Igel and Jan Henrik Ahrnell, and each of them, with full power to act without the other, his or her true and lawful attorneys-in-fact and agents, with full and several power of substitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any or all amendments, including post-effective amendments and supplements to this amendment to the registration statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his or her substitutes, may lawfully do or cause to be done by virtue hereof.

Name		Title
/s/ ANDERS IGEL Anders Igel		President and Chief Executive Officer (Principal Executive Officer)
/s/ KIM IGNATIUS Kim Ignatius		Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
/s/ TAPIO HINTIKKA Tapio Hintikka		Chairman of the Board of Directors
/s/ LARS-ERIC PETERSSON Lars-Eric Petersson		Deputy Chairman of the Board of Directors

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Name		Title
/s/ CARL BENNET Carl Bennet		Member of the Board of Directors
/s/ INGVAR CARLSSON Ingvar Carlsson		Member of the Board of Directors
/s/ EVA LILJEBLOM Eva Liljeblom		Member of the Board of Directors
/s/ CAROLINE SUNDEWALL Caroline Sundewall		Member of the Board of Directors
/s/ ROGER TALERMO Roger Talermo		Member of the Board of Directors
/s/ TOM VON WEYMARN Tom von Weymarn		Member of the Board of Directors
/s/ YVONNE KARLSSON Yvonne Karlsson		Member of the Board of Directors
/s/ BERITH WESTMAN Berith Westman		Member of the Board of Directors
/s/ ELOF ISAKSSON Elof Isaksson		Member of the Board of Directors

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SIGNATURE OF AUTHORIZED REPRESENTATIVE OF THE REGISTRANT

      Pursuant to the Securities Act of 1933, as amended, the undersigned, the duly authorized representative in the United States of TeliaSonera AB, has signed this registration statement on December 18, 2002.

/s/ BRIAN MCHUGH Brian McHugh		Authorized representative in the United States

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