Pirelli & C.: ordinary and extraordinary Shareholders'meeting

Ordinary And Extraordinary Shareholders' Meeting Of Pirelli & C. Spa:

-   Reduction of Share Capital Approved: Nominal Value of Each Share Will Change from 0.52 Euros to 0.29 Euros

-   The Reduction is Directed Towards Distribution of an "Extraordinary Dividend" of 0.154 Euros per Share (for a Total of 827 Million Euros) and the Setting Aside of Reserves for 408 Million Euros

- The Transaction is now Subject to Approval by the Special Shareholders' Meeting of Savings Shareholders, Called for 14 December 

-   Enrico Cucchiani Confirmed as Board Member

Milan, 12 December 2007 - The Shareholders' meeting of Pirelli & C. SpA met today in an ordinary and extraordinary session.

In the extraordinary session, the meeting, among other things, approved the reduction of the share capital of approximately 1,235 million euros, and therefore from the current 2,791,311,344.64 euros to 1,556,692,865.28 euros by way of reduction of the nominal value of the ordinary and savings shares, which will change from 0.52 euros to 0.29 euros.

The reduction, proposed by the Board of Directors of Pirelli & C. SpA last 9 November, has as its purpose to allow payment to the shareholders of part of the financial resources obtained from the sale of the stake in Olimpia SpA, through distribution of an "extraordinary dividend" of 0.154 euros per share (for a total amount of approximately 827 million euros), as well as to optimize the equity structure of the company, by way of setting aside to reserves approximately 408 million euros.

The transaction is now subject to approval by the Special Shareholders' meeting of savings shareholders, which will meet on third call Friday 14 December 2007.

It may be presumed that the "extraordinary dividend" will be paid after the first half of March 2008. As far as tax implications, the transaction, realizing a payment of capital, is exempt both for the company and for the shareholder-beneficiaries.

In the ordinary session, the Meeting confirmed Enrico Cucchiani in his position as Director of the Company. Mr. Cucchiani's curriculum vitae is available on the website www.pirelli.com.