Pirelli & C. SpA: share capital reduction concluded

Date of 3 April confirmed for payment of "extraordinary dividend" New share capital equal to 1,556,692,865.28 euros

Milan , 27 March 2008 – Pirelli & C. SpA communicates that the offer on the stock exchange of 4,491,769 savings shares of the Company that were the object of withdrawal and were not bought in the context of the option offer which closed last 27 February, was concluded on 26 March 2008 without any purchases taking place.

Therefore, according to law, Pirelli & C. SpA will today purchase all the shares that are the object of withdrawal which have not been placed, at a unit price of 0.8055 euros, for a total amount of about 3.6 million euros, using available reserves.

The liquidation value of the savings shares that are the object of withdrawal will be paid to the appropriate parties, through their respective intermediaries, on 31 March 2008.

Upon expiration of the legal terms, in addition, there is no creditor opposition to the Company regarding the share capital reduction. The Company therefore confirms that the "extraordinary dividend" of 0.154 euros per each ordinary and savings share will be paid on 3 April 2008 (ex dividend 31 March 2008). From a tax point of view, realizing a reimbursement of capital, the transaction is exempt both for the Company and for the shareholder beneficiary.

After the transaction, the new share capital of Pirelli & C. SpA will be equal to  1,556,692,865.28 euros. The total number of shares will remain unchanged (5,233,142,003 ordinary shares and 134,764,429 savings shares), while the nominal per share value will change to 0.29 euros.

Finally, it should be noted that, within the context of the reduction of share capital for a total of 1,234.6 million euros, an amount of about 408 million euros has been set aside for the creation of an equity reserve fund.