Placement of 8.37% of Pirelli RE completed

PLACEMENT OF 8.37% OF PIRELLI RE SHARE CAPITAL TO ITALIAN AND FOREIGN INSTITUTIONAL INVESTORS SUCCESSFULLY COMPLETED

DEMAND LARGELY EXCEEDED OFFER AND FINAL PRICE OF PLACEMENT WAS 27.25 EUROS PER SHARE

GROSS CAPITAL GAIN OF MORE THAN 56 MILLION EUROS IN CONSOLIDATED FINANCIAL STATEMENTS

Milan , 28 July 2004 - Pirelli & C. SpA informs that placement to Italian and foreign institutional investors of n. 3,400,000 Pirelli & C. Real Estate SpA ordinary shares equal to 8.37% of share capital announced today was successfully completed.

Deutsche Bank AG, London , which was in charge of placement, informed Pirelli & C. SpA that demand of Pirelli & C. Real Estate SpA ordinary shares coming from investors largely exceeded offer and that final price of placement was 27.25 Euros per share.

Pirelli & C. SpA gross capital gain in consolidated financial statements is more than 56 million Euros. Operation settlement will be next 3 August 2004.
Pirelli has agreed with Deutsche Bank AG not to sell any further share of Pirelli & C. Real Estate SpA until 30 April 2005.

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