UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE

SECURITIES EXCHANGE ACT OF 1934

For the ~~three~~six-month period ended ~~March~~June 3130, 2011

Commission File Number 001-31894

ALESTRA, S. de R.L. de C.V.

(Translation of Registrant’s name into English)

Ave. Lázaro Cárdenas No. 2321, 9th Floor

Col. Residencial San Agustín

San Pedro Garza García N.L. 66260 México

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F x Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ¨ No x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-

Table Of Contents

Cautionary Statement on Forward-Looking Statements			3
Item 1. Management’s Discussion and Analysis of Financial Condition and Results of Operations			4
Item 2. Unaudited Condensed Consolidated Financial Statements as of March 31, 2011 and for the three months period ended March 31, 2010 and 2011			F-1
Item 2. Unaudited Condensed Consolidated Financial Statements as of June 30, 2011 and for the six-month period ended June 30, 2010 and 2011			F-1

This Form 6-K consists of a Management’s Discussion and Analysis of Financial Condition and Results of Operations and unaudited condensed consolidated financial statements for Alestra, S. de R.L. de C.V. (“Alestra”) and its subsidiaries, Servicios Alestra, S.A. de C.V. (“Servicios Alestra”) and Alestra Telecomunicaciones Inalámbricas, S. de R.L. de C.V. (“Alestra Telecomunicaciones Inalámbricas”), as of June 30, 2011 and for the ~~three~~six-month ~~months~~periods ended ~~March~~June 3130, 2010 and 2011.

Mexican Financial Reporting Standards (“Mexican FRS”) requires that financial information starting from January 1, 2008 be presented in nominal Mexican Pesos (“Pesos” or “Ps.”), unless otherwise noted for the convenience of the reader. Please note that some figures in this Form 6-K may not sum due to rounding.

In this report, unless the context otherwise requires, the terms “we,” “us,” “our,” “our company” and “ourselves” mean Alestra and its subsidiaries, Servicios Alestra and Alestra Telecomunicaciones Inalámbricas.

Cautionary Statement on Forward-Looking Statements

This report includes or incorporates forward-looking statements, which include statements with respect to our plans, strategies, beliefs and other statements that are not historical facts. These statements are based on our management’s assumptions and beliefs in light of the information currently available to them. These assumptions and beliefs include information concerning us, as well as the Mexican economy and telecommunications industry.

The assumptions also involve risks and uncertainties which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Potential risks and uncertainties include, without limitation:

•

general economic conditions in Mexico and the United States, and any significant economic or political developments in those countries;

•

the competitive nature of providing long distance, data, internet and local services;

•

changes in our regulatory environment, particularly changes in the regulation of the telecommunications industry;

•

the risks associated with our ability to implement our strategy;

•

customer turnover;

•

technological innovations;

•

our need for substantial capital;

•

interest rate levels;

•

performance of financial markets and our ability to refinance our financial obligations when they become due;

•

our ability to service our debt;

•

limitations on our access to sources of financing on competitive terms;

•

currency exchange rates, including the Peso/U.S. dollar exchange rate;

•

changes in our costs of doing business, including but not limited to costs associated with billing and collection, marketing and sales, and personnel training and travel expenses; and

•

changes in the policies of central banks and/or foreign governments.

Accordingly, readers are cautioned not to place undue reliance on these forward-looking statements. In any event, these statements are applicable only as of the date of this Form 6-K, and we undertake no obligation to update or revise any of them, whether as a result of new information, future events or otherwise. See Item 1. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Item 1. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements as of ~~March~~June 3130, 2011 and for the ~~three~~six-month periods ended ~~March~~June 3130, 2011 and 2010 and the notes thereto contained elsewhere herein.

~~Three~~Six-month period ended ~~March~~June 3130, 2011 compared to the ~~three~~six-month period ended ~~March~~June 3130, 2010

Revenues

Total revenue during the ~~three~~six-month period ended ~~March~~June 3130, 2011 was Ps. 12,~~161~~302.16 million, a 42.07%, or Ps. 4459.8 million, increase from the Ps. 12,~~116~~242.38 million for the ~~same~~six-month period inended June 30, 2010. This increase was primarily the result of an increase in our data, internet and local services revenues.

Data, Internet and Local Services. During the ~~three~~six-month period ended ~~March~~June 3130, 2011, data, internet and local service revenues reached Ps. ~~914~~1,818.73 million, a 97.58%, or Ps. 79132.70 million, increase from Ps. ~~835.~~1,686.2 million for the ~~same~~six-month period inended June 30, 2010. The increase in data, internet and local services revenues was primarily due to an increase in revenues from internet-related services, such as virtual private network (“VPN”) and managed services. Our data, internet and local services represented 7879.80% of our total revenues during the ~~three~~ six-month period ended ~~March~~June 3130, 2011, compared to 7475.82% during the same period in 2010.

Long Distance Services. Revenues from our long distance services for the ~~three~~six-month period ended ~~March~~June 3130, 2011 decreased 1213.40%, or Ps. 3472.93 million, to Ps. ~~246~~484.43 million from Ps. ~~281~~556.36 million for the ~~same~~six-month period inended June 30, 2010. The decrease in long distance revenues was primarily due to lower traffic partially offset by an increase in revenue per minute. The average long distance revenue per minute increased to Ps. 0.72 for the six-month period ended June 30, 2011 from Ps. 0.62 recorded during the six-month period ended June 30, 2010. Total volume of minutes handled decreased 2824.38%, to ~~334~~672 million in the ~~three~~six-month period ended ~~March~~June 3130, 2011 from ~~466~~893 million minutes for the ~~same~~six-month period ended inJune 30, 2010. The decrease in volume is primarily attributable to less international long distance traffic. As a percentage of total revenues, long distance services revenues represented 21.20% of our total revenues during the ~~three~~six-month period ended ~~March~~June 3130, 2011, compared to 2524.28% during the same period in 2010.

Cost of services (excluding depreciation and amortization)

Cost of services consists primarily of:

•

fees for leased lines, typically paid on a per-circuit per-month basis primarily to Teléfonos de México S.A.B. de C.V. (“Telmex”) and other last mile access providers;

• interconnection costs, including local access charges and resale expenses, paid on a per-minute basis primarily to Telmex; and

•

international settlement payments to foreign carriers on a per-minute basis for the completion of international calls originated in Mexico by us.

Cost of services decreased 0.5.1%, or Ps. 138.7 million, to Ps. ~~372~~713.18 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011 from Ps. ~~373~~752.86 million for the ~~three~~six-month period ended ~~March~~June 3130, 2010. The reduction in cost of services was primarily the result of a decrease in cost of long distance services.

Data, Internet and Local Services. Cost of data, internet and local services increased 168.08%, or Ps. 3236.54 million, to Ps. ~~235~~449.57 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011 from Ps. ~~203~~413.03 million for the ~~three~~six-month period ended ~~March~~June 3130, 2010. This was primarily due to an increase in revenues from internet-related services, such as VPN ~~and~~ ~~Ethernet,~~ and managed services.

Long Distance Services. Cost of long distance services decreased 22.1%, or Ps. 75.1 million, to Ps. 264.2 million for the six-month period ended June 30, 2011 from Ps. 339.3 million for the six-month period ended June 30, 2010. This decrease in cost of long distance services was primarily due to lower interconnection costs resulting from a decrease in the volume of international long distance traffic.

Long Distance Services. Cost of long distance services decreased 20.0%, or Ps. 34.2 million, to Ps. 136.6 million for the three-month period ended March 31, 2011 from Ps. 170.8 million for the three-month period ended March 31, 2010. This decrease in cost of long distance services was primarily due to lower interconnection costs resulting from a decrease in the volume of domestic and international long distance traffic.

Gross profit

Gross profit is defined as revenues minus cost of services (excluding depreciation and amortization). Gross profit is a non-GAAP financial measure that is not defined under Mexican FRS.

We believe that gross profit can be useful in facilitating comparisons of operating performance between periods and with other companies. However, our computation of gross profit is not necessarily comparable to gross profit as reported by other companies because it excludes depreciation and amortization expenses. Though gross profit is a relevant measure of operating performance, it should not be considered as an alternative to operating income (determined in accordance with Mexican FRS, as an indication of our financial performance), or an indication of resources generated from operating activities (determined in accordance with Mexican FRS, as a measure of our liquidity), nor is it indicative of funds available to meet our cash needs.

Gross profit increased 6.36%, to Ps. ~~789~~1,588.08 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011 from Ps. ~~742~~1,490.53 million for the ~~three~~six-month period ended ~~March~~June 3130, 2010. Our gross profit increased primarily due to the increase in data, internet and local services gross profit.

Data, Internet and Local Services. Our data, internet and local services gross profit increased 7.5%, or Ps. 4795.26 million, to Ps. ~~679~~1,368.26 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011 from Ps. ~~632~~1,273.0 million for the ~~three~~six-month period ended ~~March~~June 3130, 2010. This increase was primarily due to the 97.58% increase in data, internet and local services revenues.

Long Distance Services. Our long distance gross profit ~~decreased~~increased 01.63%, or Ps. 02.78 million, to Ps. ~~109~~220.82 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011 from Ps. ~~110~~217.53 million for the ~~three~~six-month period ended ~~March 31~~June, 2010. This ~~decrease~~increase was primarily due to the 12 15.47% ~~decrease~~increase in ~~both~~revenue ~~domestic~~per ~~and international long distance revenues~~minute.

Our gross margin, defined as gross profit as a percentage of total revenues, was 6869.0% for the ~~three~~six-month period ended ~~March~~June 3130, 2011 as compared to 66.54% for the ~~same~~six-month period inended June 30, 2010.

A reconciliation of our operating income to gross profit is provided below as of June 30, 2010 and 2011.


	Six-month period ended June 30,
	(in millions of nominal Pesos)
	2010			2011
Gross Profit		1,490.3			1,588.8
Administration, selling and other operating expenses		(784.2	)		(801.3	)
Depreciation and amortization		(425.7	)		(422.1	)

Operating Income		280.4			365.4

Administration, selling and other operating expenses

Administration, selling and other operating expenses increased 12.32%, or Ps. 517.1 million, to Ps. ~~396~~801.43 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011 from Ps. ~~391~~784.32 million for the ~~same~~six-month period inended June 30, 2010, primarily as a result of higher personnel expenses. For the ~~three~~six-month periods ended ~~March~~June 3130, 2011 and 2010, administration, selling and other operating expenses represented 34.18% and 35.10% of total revenues, respectively.

Depreciation and amortization

Depreciation and amortization amounted to Ps. ~~211~~422.81 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011, compared to Ps. ~~212~~425.27 million for the ~~same~~six-month period inended June 30, 2010.

Operating income

Operating income increased 30.03%, or Ps. 4184.79 million, to Ps. ~~180~~365.74 million in the ~~three~~six-month period ended ~~March~~June 3130, 2011 from Ps. ~~139~~280.04 million for the ~~three~~six-month period ended ~~March~~ June 3130, 2010. This increase was primarily due to a Ps. 4698.5 million increase in gross profit.

Comprehensive financial result

During the ~~three~~six-month period ended ~~March~~June 3130, 2011, our comprehensive financial ~~result~~loss was Ps. 043.80 million compared to a Ps. 5588.38 million ~~gain~~loss for the ~~same~~six-month period inended June 30, 2010. The following table sets forth our comprehensive financial results for the periods under review:

	Three-month period endedMarch 31,
	Six-month period endedJune 30,
	(in millions of nominal Pesos)
	2010			2011
Interest expense		(92192.1	)		(83166.02	)
Interest income		13.42			1.3.2
Exchange gain, net		~~145~~99.6			87124.25
Effect of derivative financial instruments		0.3			(4.7	)
Gain/(loss) on derivative financial instruments		0.6			(4.5	)
Comprehensive financial result, net		55(88.38	)		0(43.80	)

Our interest expense decreased by Ps. 926.10 million, to Ps. 83166.02 million, for the ~~three~~six-month ~~period~~ period ended ~~March~~June 3130, 2011 from Ps. 92192.1 million for the ~~same~~six-month period inended June 30, 2010. This decrease was driven by the appreciation of the Peso against the U.S. dollar during the last twelve months, since our total debt is U.S. dollar-denominated, coupled with a decrease in our total debt outstanding atduring ~~March~~the six-months period ended June 3130, 2011 compared to the same period of 2010.

Interest income amounted to Ps. 1. 3.2 million for the ~~three~~six-month period ended ~~March~~June 3130, 2011, ~~compared~~and ~~to Ps. 1.4 million~~ for the ~~same~~six-month period inended June 30, 2010.

Exchange gain for the ~~three~~six-month period ended ~~March~~June 3130, 2011 was Ps. 87124.25 million compared to an exchange gain of Ps. ~~145~~ 99.6 million for the ~~same~~six-month period inended June 30, 2010. We record a foreign exchange gain or loss with respect to U.S. dollar-denominated net monetary position of assets and liabilities when the Peso appreciates or depreciates in relation to the U.S. dollar. Our U.S. dollar-denominated monetary liabilities exceeded our U.S. dollar-denominated monetary assets during the ~~three~~six-month periods ended ~~March~~June 3130, 2011 and 2010. We recorded a foreign exchange gain during the ~~three~~ six-month period ended ~~March~~June 3130, 2011 as a result of a 34.2% appreciation of the Peso against the U.S. dollar, while during the ~~same~~six-month period inended June 30, 2010 the Peso appreciated 43.61% against the U.S. dollar.

Our principal foreign currency fluctuation risk involves changes in the value of the Peso relative to the U.S. dollar. In past years, we have considered alternatives to manage this risk, including the use of hedging instruments, in order to minimize the impact on our cash flow ~~from~~due to the exchange rate fluctuation of the Peso to the U.S. dollar ~~exchange rate fluctuation~~. In October 2010, we entered into a currency hedge to minimize the effects of the Peso to U.S. dollar exchange rate fluctuation. We sought to hedge the interest payment of our senior notes due 2014 through two foreign exchange forward contracts. Each of these forward contracts was in an amount of U.S.$11.75 million at an exchange rate of Ps. 12.463 per U.S.$1.00 and Ps. 12.611 per U.S.$1.00 in February 2011 and August 2011, respectively. The effect of the forward contract that matured in February 2011 was negative, and for the ~~three~~six-month period ended ~~March~~June 3130, 2011 amounted to Ps. 5.0 million. In addition, we have a U.S. dollar-denominated lease contract in which the dollar currency embedded in the host lease contract is considered an embedded derivative for accounting purposes. For the ~~three~~six-month period ended ~~March~~June 3130, 2011, the effect of this embedded derivative was positive and amounted to Ps. 0.35 million. This contract is evaluated on a monthly basis.

Other Expense, Net

Other expense, net increased Ps. 15.3 million, to Ps. 23.8 million in the six-month period ended June 30, 2011 from Ps. 8.6 million during the six-month period ended June 30, 2010. This increase was primarily due to the disposal of obsolete fixed assets.

Income and IETU

We and our subsidiaries, Servicios Alestra and Alestra Telecomunicaciones Inalámbricas, are required to pay the greater of the income tax or the flat tax (Impuesto Empresarial a Tasa Única, or “IETU”), which are computed separately for each entity. We participate in the tax consolidation of ALFA, S.A.B. de C.V. (“Alfa”), our holding

~~Income~~ company. ~~and~~For ~~IETU~~the six-month period ended June 30, 2011, we recorded an income tax provision using an income tax effective rate of 22.7%, compared to an income tax effective rate of (2.2)% for the six-month period ended June 30, 2010.

We and our subsidiaries, Servicios Alestra and Alestra Telecommunicaciones Inalambricas, are required to pay the greater of the income tax or the flat tax (Impuesto Empresarial a Tasa Única, or “IETU”), which are computed separately for each entity. We participate in the tax consolidation of Alfa, our holding company. For the ~~three~~six-month period ended ~~March~~ June 3130, 2011, ~~we recorded an~~ our income tax ~~provision~~is ~~using~~higher anthan ~~income~~our IETU tax; ~~effective rate of 22%~~accordingly, ~~compared~~we tohave annot ~~income~~recognized ~~tax~~any ~~effective~~IETU ~~rate~~in ~~of -18%~~our ~~for the~~consolidated ~~three-month~~income ~~period ended March 31, 2010~~statements.

~~For~~In accordance with the ~~three-month~~interpretation ~~period~~published ~~ended~~by ~~March~~the Mexican Board of Research and Development of Financial Reporting Standards (“CINIF”) on December 3121, ~~2011~~2007, ~~our~~with ~~income~~respect ~~tax~~to isthe ~~higher~~accounting ~~than~~effects ~~our~~of the IETU, and based on financial and tax; ~~accordingly~~projections, we have determined that we will continue to pay regular income tax in the foreseeable future. As a result, we did not ~~recognized~~record any deferred IETU intaxes ~~our~~as ~~consolidated~~of ~~income~~June 30, ~~statements~~2011.

In accordance with the interpretation published by the Mexican Board of Research and Development of Financial Reporting Standards (“CINIF”) on December 21, 2007, with respect to the accounting effects of the IETU, and based on financial and tax projections, we have determined that we will continue to pay regular income tax in the foreseeable future. As a result, we did not record any deferred IETU taxes as of March 31, 2011.

Net Income

During the ~~three~~six-month period ended ~~March~~June 3130, 2011, we recorded a net income of Ps. ~~130~~231.95 million compared to a net income of Ps. ~~220~~ 187.02 million during the ~~same~~six-month period inended June 30, 2010, aan ~~decrease~~increase of Ps. 8944.03 million, or 4023.56%. ~~Although~~The ~~our~~increase ~~operating income increased~~ in ~~the~~net ~~three-month~~income ~~period~~was ~~ended~~primarily ~~March 31,~~explained ~~2011~~by ~~when~~an ~~compared~~increase ~~to the same period~~ in ~~2010,~~operating ~~the decrease in net~~ income ~~was~~of ~~primarily~~Ps. ~~explained~~84.9 million bycoupled with an increase ~~income~~in ~~tax~~exchange ~~expense~~gain of Ps. 37 24.49 million ~~during~~in the ~~three~~six-month period ended ~~March~~June 3130, 2011, when compared to ~~an income tax benefit of Ps. 32.8 million during~~ the ~~same~~six-month period inended ~~2010~~June 30, ~~coupled~~2010; ~~with~~partially offset by an ~~exchange~~income ~~gain~~tax expense of Ps. 8767.21 million during the ~~three~~ six-month period ended ~~March~~June 3130, 2011, compared to an ~~exchange~~income ~~gain~~tax benefit of Ps. ~~145~~4.60 million during the ~~same~~six-month period inended June 30, 2010.

Current Liquidity

As of ~~March~~June 3130, 2011, December 31, 2010 and ~~March~~June 3130, 2010, we had Ps. ~~351~~417.97 million, Ps. 486.2 million and Ps. ~~261~~375.89 million of unrestricted cash available, respectively. ~~Our~~The ~~unrestricted~~reduction in cash balance ~~decreased~~during bythe ~~Ps.~~first ~~134.3 million,~~six-months toof ~~Ps.~~2011 ~~351.9 million~~is asmainly ofexplained ~~March~~by US$ ~~31, 2011 from Ps~~18. ~~486.2~~6 million ~~as of December 31, 2010. This decrease was primarily a result of~~ debt ~~prepayments in~~pre-payment anwith ~~amount~~internally ofgenerated ~~US$ 7~~funds.0 ~~million.~~

Our unrestricted cash balance consists of cash and temporary investments with original maturities of three months or less.

Our treasury policy is to invest in highly liquid temporary cash investments issued by the U.S. and Mexican governments, major U.S. and Mexican banks, and corporations with high credit ratings. As of ~~March~~June 3130, 2011, we had cash of Ps. 2635.05 million and temporary investments of Ps. ~~325~~ 382.92 million, of which Ps. ~~176~~ 272.39 million were in Peso-denominated instruments and Ps. ~~149~~109.63 million in U.S. dollar-denominated instruments. In our opinion, our cash and cash equivalents balance is sufficient for our present requirements.

As of ~~March~~June 3130, 2011, December 31, 2010 and ~~March~~June 3130, 2010, our ratio of current assets to current liabilities was 0 1.~~98x~~01x, 0.97x and 0.~~94x~~93x, respectively. Our ratio of current assets to current liabilities as of ~~March~~June 3130, 2011 includes the corresponding amortization of our bank facility and our vendor facilities, which is described below.

As ofMarch 31,2011

As ofDecember 31,2010

As ofMarch 31,2010

As ofJune 30,2011

As ofDecember 31,2010

As ofJune 30,2010

(in millions of nominal Pesos, excluding ratios)

Unrestricted cash balance

~~Ps. 351.9~~

417.7

~~Ps. 486.2~~

~~Ps. 261.8~~

486.2

375.9

Current ratios (times)

~~0.98x~~

1.01x

~~0.97x~~

~~0.94x~~

0.97x

0.93x

On September 8, 2009, a trust was created by us, Telmex, and BBVA Bancomer as a trustee, to guarantee the payment of interconnection services. As of ~~March~~June 3130, 2011, the trust balance was US$ 33.29 million, registered as cash and cash equivalents in our financial statements.

Capital expenditures during the six-month period ended June 30, 2011 amounted to Ps. 297.9 million, compared to Ps. 310.7 million invested in the six-month period ended June 30, 2010. Our capital expenditure program includes investments to expand our network, develop new services to customers, increase data center capacity, and also to provide last mile and direct access to connect customers to our network. As of the date of this report, our capital expenditure program is proceeding according to schedule.

Net debt decreased US$ 33.4 million, to US$ 173.2 million as of March 31, 2011 from US$ 206.6 million as of March 31, 2010. The decrease in net debt is primarily explained by a US$ 17.7 million decrease of our total debt outstanding coupled with a US$ 13.9 million increase of our cash and cash equivalents when compared to the same period of 2010.

Capital expenditures during the three-month period ended March 31, 2011 amounted to Ps. 158.4 million, Ps. 21.6 million higher than the Ps. 136.8 million invested in the same period in 2010. Our capital expenditure program includes investments to expand our network, provide new services to customers and increase data center capacity, and also includes last mile and direct access to connect customers to our network. As of the date of this report, our capital expenditure program is proceeding according to schedule.

Indebtedness

As of ~~March~~June 3130, 2011, December 31, 2010 and ~~March~~June 3130, 2010, our total debt amounted to US$ ~~232~~217.39 million, US$ 242.6 million and US$ ~~250~~ 245.08 million, respectively. Total debt as of ~~March~~June 3130, 2011 includes:

•

11.750% senior unsecured notes due 2014 in an amount of US$ 200.0 million;

•

a bank facility in an amount of US$ 10.0 million; and

• vendor facilities in an aggregate amount of US$ 227.39 million.

As of ~~March~~June 3130, 2011, we had outstanding US$ 200.0 million aggregate principal amount of our 11.750% senior notes due 2014, (the “senior notes”), which pay interest semiannually in cash in arrears on February 11 and August 11~~, beginning on February 11, 2010~~. The principal amortization is payable at maturity on August 11, 2014.

On September 27, 2010, we signed a committed revolving facility and a term loan agreement with Comerica Bank for US$ 20 million and US$ 10 million, respectively (together, the “Comerica Bank credit facility”). The committed revolving facility bears interest at a three-month adjusted LIBOR rate plus 3.50%, payable on a quarterly basis , and is effective until December 31, 2012. As of ~~March~~ June 3130, 2011, ~~this~~the committed revolving facility remained unused. The term loan bears interest at a three-month adjusted LIBOR rate plus 3.75%, payable on a quarterly basis. ~~and~~The ~~the~~ principal is payable in four equal installments in March 2012, June 2012, September 2012 and December 2012. ~~These loan agreements contain customary covenants with which, as of March 31, 2011, we are in full compliance.~~

As of ~~March~~June 3130, 2011, we had a vendor facility with an outstanding balance of US$ 134.70 million with Cisco Systems Capital Corporation (“Cisco”), which pays principal and interest on a monthly basis. ~~Tranches~~This ~~with~~loan ~~maturities~~matures inon ~~2012 and 2013 have an outstanding balance of US$ 8.0~~July ~~million and US$ 5.7 million~~6, ~~respectively~~2013.

As of ~~March~~June 3130, 2011, we had a vendor facility with an outstanding balance of US$ 62.51 million with Hewlett-Packard Operations México S. de R.L. de C.V. (“HP”), which pays principal and interest on a monthly basis. ~~Tranches~~This ~~with~~loan ~~maturities~~matures inon ~~2013 and 2014 have an outstanding balance of US$ 4.2~~February ~~million and US$ 2.3 million~~28, ~~respectively~~2014.

As of ~~March~~June 3130, 2011, we had a vendor facility with an outstanding balance of US$ 1.8 million with Huawei Technologies de México, S.A de C.V ~~with an outstanding balance of US$ 2.0 million~~, which pays principal and interest on a quarterly basis and matures in December 2012.

The senior notes and Comerica Bank credit facility contain customary covenants with which, as of June 30, 2011, we are in full compliance.

Subsequent Events

AT&T Transactions

On July 12, 2011, Alfa terminated the joint venture agreement entered into between AT&T Telecom México, Inc. (“AT&T México”), Alfa and us, as amended on November 30, 2005, and the equity purchase agreement entered into between AT&T Corp. (“AT&T”), AT&T México, Alfa and us on April 14, 2011 and completed the acquisition of AT&T México’s 49% equity interest in us after receiving approval from regulatory authorities in Mexico. Following the closing of these transactions, which were originally announced in April 2011, Alfa is now the sole shareholder of Alestra.

In addition, on July 12, 2011, the Company entered into the nodes purchase agreement with AT&T, AT&T México and Alfa, pursuant to which AT&T México purchased from us the telecommunications nodes and customer equipment (the “Nodes”) required for the provision of AT&T Global Services in Mexico (the “Nodes Purchase Agreement”).

On July 12, 2011, we entered into an Equipment Lease Agreement with AT&T México pursuant to which we lease from AT&T México the Nodes required for the provision of AT&T Global Services in Mexico (the “Equipment Lease Agreement”) until December 31, 2012. The Equipment Lease Agreement is subject to early termination if AT&T acquires the necessary licenses and regulatory approvals to offer, directly and independently from us, AT&T Global Services within Mexico, with AT&T México.

Upon the termination of the Equipment Lease Agreement, (i) we and AT&T México will terminate the brand name use agreement between AT&T and us, the AT&T Global Network Cooperation Agreement (the “AGN Agreement”) prior to its June 30, 2013 expiration date and (ii) we will enter into several commercial agreements pursuant to which we will provide certain telecommunication services to AT&T México.

After the termination of the AGN Agreement, we will no longer provide AT&T Global Services in Mexico and will be required to cease using any of AT&T’s intellectual property.

Dividends

On July 6, 2011 and July 8, 2011, we paid a US$ 10 million dividend, the second installment of a US$ 15 million dividend declared in a shareholders meeting held on December 21, 2009. In addition, in a general ordinary meeting held on July 19, 2011 the shareholders declared and we paid a dividend of US$9 million.

Subsequent Events

On April 14, 2011, we entered into an Equity Purchase Agreement with AT&T Corp. (“AT&T”), AT&T Telecom Mexico Inc. (“AT&T Mexico”) and Alfa, S.A.B. de C.V. (“Alfa”), pursuant to which Alfa has agreed to acquire AT&T Mexico’s 49% equity interest in our company (the “Equity Purchase Agreement”). On April 14, 2011, we also entered into a nodes purchase agreement with AT&T, AT&T Mexico and Alfa, pursuant to which AT&T Mexico has agreed to purchase from us the telecommunications nodes and customer equipment (the “Nodes”) required for the provision of AT&T Global Services in Mexico (the “Nodes Purchase Agreement” and, together with the Equity Purchase Agreement, the “AT&T Transactions”).

Consummation of the AT&T Transactions is subject to customary conditions, including: (i) receipt of certain regulatory approvals; (ii) absence of any law or order prohibiting the closing of the transactions; (iii) subject to certain exceptions, the accuracy of representations and warranties; and (iv) payment of certain amounts due to AT&T and AT&T Mexico. The AT&T Transactions are expected to close in the second half of 2011.

Upon the consummation of the AT&T Transactions, (i) Alfa & AT&T Mexico will terminate the Amended and Restated Joint Venture Agreement, and (ii) we and AT&T Mexico will enter into an Equipment Lease Agreement pursuant to which we will lease from AT&T Mexico the Nodes required for the provision of AT&T Global Services in Mexico (the “Equipment Lease Agreement”) until December 31, 2012. The Equipment Lease Agreement is subject to early termination if AT&T Mexico acquires the necessary licenses and regulatory approvals to offer, directly and independently from us, AT&T Global Services within Mexico, prior to December 31, 2012.

Upon the termination of the Equipment Lease Agreement, we and AT&T Global Network Services Mexico S. de R.L. de C.V. (“AGNS Mexico”) will enter into several commercial agreements pursuant to which we will provide certain telecommunication services to AGNS Mexico. In addition, following the termination of the Equipment Lease Agreement, we and AT&T will terminate the AGN Agreement.

UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As of ~~March~~June 3130, 2011 and for the ~~Three~~six months ended ~~March~~June 3130, 2010 and 2011

Unaudited Consolidated Balance Sheets as of December 31, 2010 and March 31, 2011			F-2
Unaudited Consolidated Balance Sheets as of December 31, 2010 and June 30, 2011			F-2
Unaudited Consolidated Statements of Operations for the Three Months Ended March 31, 2010 and 2011			F-3
Unaudited Consolidated Statements of Income for the Periods of Six-Months and Three-Months Ended June 30, 2010 and 2011			F-3
Unaudited Consolidated Statements of Changes in Stockholders’ Equity			F-4
Unaudited Consolidated Statements of Changes in Stockholders’ Equity for the Six-Months Ended June 2010 and 2011			F-4
Unaudited Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2010 and 2011			F-5
Unaudited Consolidated Statements of Cash Flow for the Six Months Ended June 30, 2010 and 2011			F-5
Notes to Unaudited Condensed Consolidated Financial Statements			F-6

ALESTRA, S. DE R. L. DE C. V. AND SUBSIDIARIES

Subsidiaries of Alfa S. A. B. de C. V.

UNAUDITED CONSOLIDATED BALANCE SHEETS

(Amounts are expressed in thousands of adjusted nominal Mexican Pesos)

	December 31,2010			~~UnauditedMarch~~UnauditedJune 3130, 2011
Assets
CURRENT ASSETS:
Cash and cash equivalents	Ps	864,431		Ps	~~749~~818,~~041~~449
Trade receivables, net of allowance for doubtful accounts of Ps 39,351 in December 31, 2010 and Ps 41,810 in March 31, 2011		493,030			596,107
Trade receivables, net of allowance for doubtful accounts of Ps 39,351 in December 31, 2010 and Ps 45,731 in June 30, 2011		493,030			566,299
Due from affiliates and other related parties		7,974			78,~~777~~574
Other receivables		104,924			9782,~~107~~791
Prepaid expenses		41,213			7181,~~215~~334
Other current assets		28,397			1012,~~421~~446
Total current assets		1,539,969			1,~~531~~569,~~668~~893
NON CURRENT ASSETS:
Property and equipment, net (Note 3)		5,077,968			54,~~025~~958,~~031~~536
Deferred charges and other assets, net		276,189			~~262~~245,~~524~~547
Deferred income tax (Note 7)		198,853			~~203~~213,~~003~~585
Prepaid expenses, net		49,210			45,855
Prepaid expenses		49,210			42,500
Total non current assets		5,602,220			5,~~536~~460,~~413~~168
Total assets	Ps	7,142,189		Ps	7,~~068~~030,~~081~~061
Liabilities and stockholders’ equity
CURRENT LIABILITIES:
Accounts payable to Teléfonos de México, S.A.B de C.V. and other carriers	Ps	496,646		Ps	~~509~~533,~~882~~505
Other suppliers		265,816			~~319~~200,~~189~~063
Bank loans, notes payable and capital leases (Note 4)		216,957			~~174~~104,~~973~~169
Due to affiliates and other related parties		9,790			1820,~~547~~013
Dividends payable		123,571			~~119~~118,~~678~~389
Interest payable		118,842			40113,~~982~~289
Other accounts payable and accrued expenses		354,670			~~376~~463,~~459~~560
Total current liabilities		1,586,292			1,~~559~~552,~~710~~988
LONG-TERM LIABILITIES:
11.750% Senior Notes due 2014 (Note 5)		2,471,420			2,393,560
11.750% Senior notes due 2014 (Note 5)		2,471,420			2,367,780
Bank loans, notes payable and capital leases (Note 4)		309,937			~~211~~107,~~790~~537
Employee’s benefits		106,746			108,~~028~~948
Total liabilities		4,474,395			4,~~273~~137,~~088~~253
STOCKHOLDERS’ EQUITY:
Contributed stock		1,394,971			1,394,971
Retained earnings		1,272,865			1,~~400~~497,~~065~~880
Total shareholders’ equity of Alestra		2,667,836			2,~~795~~892,~~036~~851
Non controlling interest		(42	)		(43	)
Total stockholders’ equity		2,667,794			2,~~794~~892,~~993~~808
CONTINGENCIES (Note 8)
CONTINGENCIES AND COMMITMENTS (Note 8)
Total liabilities and stockholders’ equity	Ps	7,142,189		Ps	7,~~068~~030,~~081~~061

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-2

ALESTRA, S. DE R. L. DE C. V. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF ~~OPERATIONS~~INCOME

(Amounts are expressed in thousands of adjusted nominal Mexican Pesos)

	Three months endedMarch 31,
	Three months endedJune 30						Six months endedJune 30,
	2010			2011			2010			2011
REVENUES
Long distance services	Ps	~~281~~275,~~290~~321		Ps	~~246~~237,~~374~~968		Ps	556,611		Ps	484,342
Data, internet and local services		~~835~~851,~~054~~178			~~914~~903,~~732~~559			1,686,232			1,818,291
		1,116,344			1,161,106
		1,126,499			1,141,527			2,242,843			2,302,633
OPERATING EXPENSES :
Cost of services (excluding depreciation and amortization):
Long distance services		(~~170~~168,~~794~~493	)		(~~136~~127,~~567~~615	)		(339,287	)		(264,182	)
Data, internet and local services		(~~203~~210,~~043~~222	)		(~~235~~214,~~537~~128	)		(413,265	)		(449,665	)
		(373,837	)		(372,104	)
		(378,715	)		(341,743	)		(752,552	)		(713,847	)
Gross profit		~~742~~747,~~507~~784			~~789~~799,~~002~~784			1,490,291			1,588,786
Administration, selling and other operating expenses		(~~391~~392,~~315~~848	)		(~~396~~404,~~448~~823	)		(784,163	)		(801,271	)
Depreciation and amortization		(~~212~~213,~~184~~503	)		(~~211~~210,~~824~~319	)		(425,687	)		(422,143	)
Operating income		~~139~~141,~~008~~433			~~180~~184,~~730~~642			280,441			365,372
COMPREHENSIVE FINANCIAL RESULT:
Interest expense		(~~92,~~100,042	)		(8283,~~976~~208	)		(192,142	)		(166,184	)
Interest income		1,~~385~~781			1,~~282~~949			3,166			3,231
Exchange gain		~~145~~(46,~~641~~025	)		8737,~~199~~283			99,616			124,482
Gain (loss) on derivative financial instruments		~~344~~261			~~(4,715~~242	)		605			(4,473	)
		55,270			790
		(144,025	)		(43,734	)		(88,755	)		(42,944	)
OTHER EXPENSE, NET		(71,~~048~~504	)		(1310,~~132~~713	)		(8,552	)		(23,845	)
Gain before the following provisions for income tax		~~187~~(4,~~230~~096	)		~~168~~130,~~388~~195			183,134			298,583
Consolidated Income tax		32(28,~~753~~689	)		(3729,~~436~~694	)		4,064			(67,130	)
Consolidated net income	(Ps	~~219~~32,~~983~~785	)	Ps	~~130~~100,~~952~~501		Ps	187,198		Ps	231,453
Net loss attributable to non controlling interest		(1	)		(1	)		(1	)		(1	)
Net income attributable to total stockholders of Alestra	(Ps	~~219~~32,~~982~~786	)	Ps	~~130~~100,~~951~~500		Ps	187,197		Ps	231,452

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-3

ALESTRA, S. DE R. L. DE C. V. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Amounts are expressed in thousands of adjusted nominal Mexican Pesos)

					Accumulated (deficit) income
	Capital stock				Restatement ofCapital Stock		Effects ofderivativefinancialinstruments			Retainedearnings		Stockholderequity ofAlestra			Non controllinginterest			TotalStockholders’ Equity
	Fixed		Variable
Balance at January 1, 2010	Ps	Ps 300	Ps	Ps 1,181,046	Ps	Ps 213,625	$Ps	—		Ps	Ps 918,749	Ps	Ps 2,313,720		Ps	Ps 1		Ps	Ps 2,313,721
Changes in 2010:
Net income											~~219~~187,~~983~~198		~~219~~187,~~983~~198			—			~~219~~187,~~983~~198
Other											54,~~948~~020		54,~~948~~020			—			54,~~948~~020
Comprehensive income		—		—		—		—			225,931		225,931			—			225,931
Comprehensiva income		—		—		—		—			191,218		191,218			—			191,218
Balance at March, 31, 2010		Ps 300		Ps1,181,046		Ps 213,625		Ps —			Ps 1,144,680		Ps 2,539,651			Ps 1			Ps 2,539,652
Balance at June, 30, 2010	Ps	300	Ps	1,181,046	Ps	213,625	Ps	—		Ps	1,109,967	Ps	2,504,938		Ps	1		Ps	2,504,939
Balance at January 1, 2011		300		1,181,046		213,625		(829	)		1,273,694		2,667,836			(42	)		2,667,794
Changes in 2011:
Net income											~~130~~231,~~952~~452		~~130~~231,~~952~~452			(1	)		~~130~~231,~~951~~451
Other											1,936		1,936			—			1,936
Effect of derivative financial instruments								(6,437	)				(6,437	)		—			(6,437	)
Effect of derivative financial instruments								(5,688	)				(5,688	)		—			(5,688	)
Comprehensive income		—		—		—		(6,437	)		231,452		225,015			(1	)		225,014
Comprehensive income		—		—		—		(5,688	)		132,888		127,200			(1	)		127,199
Balance at June 30, 2011	Ps	300	Ps	1,181,046	Ps	213,625		(Ps 7,266	)	Ps	1,505,146	Ps	2,892,851			(Ps 43	)	Ps	2,892,808
Balance at March 31, 2011		Ps 300		Ps 1,181,046		Ps 213,625		(Ps 6,517)			Ps 1,406,582		Ps 2,795,036			(Ps 43	)		Ps 2,794,993

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-4

ALESTRA, S. DE R. L. DE C. V. AND ~~SUBSIDIARIES~~SUBSIDIARY

UNAUDITED CONSOLIDATED STATEMENTS OF CASH ~~FLOWS~~FLOW

(Amounts are expressed in thousands of adjusted nominal Mexican Pesos)

	Three monthsended March 31,
	Six monthsended June 30,
	2010			2011
Operation activities:
Income before income tax	Ps	~~187~~183,~~230~~134		Ps	~~168~~298,~~388~~583
Items relating to investing activities:
Depreciation and amortization		~~212~~425,~~184~~687			~~211~~422,~~824~~143
Cost related to seniority premiums and pension plans		49,~~793~~533			48,~~183~~320
Interest income		(13,~~385~~166	)		(13,~~282~~231	)
Derivative financial instruments		(~~344~~605	)		4,~~715~~473
Gain on sale of equipment		~~557~~413			~~462~~3,003
Other, net		6,703			7,104
Items relating to financing activities:
Interest expense		92192,~~100~~142			82166,~~976~~184
Exchange gain		(~~145~~99,~~641~~616	)		(87124,~~199~~482	)
Subtotal		356,197			391,171
Other, net		8,026			11,657
Increase in accounts receivable and other current assets		(104,084	)		(85,086	)
Subtotal		715,548			786,650
Increase in suppliers, accounts payable and other current liabilities		13,949			80,601
Increase in accounts receivable and other current assets		(111,784	)		(45,889	)
Income tax paid		(76,294	)		(62,787	)
Increase in suppliers, accounts payable and other current liabilities		57,089			60,813
Operating activities net cash flows		189,768			323,899
Income tax paid		(106,895	)		(106,822	)
Operating activities net cash flows		553,958			694,752
Investing activities:
Interest received		12,~~225~~906			13,~~704~~658
Acquisition of property and equipment		(~~112~~266,~~914~~114	)		(~~141~~264,~~484~~226	)
Acquisition of deferred charges and other assets		(723,~~584~~136	)		(712,~~536~~602	)
Investing activities		(~~119~~286,~~273~~344	)		(~~147~~273,~~316~~170	)
Excess in cash to be applied in financing activities net cash flows		70267,~~495~~614			~~176~~421,~~583~~582
Financing activities:
Proceeds from (payments of) bank loans, notes payable and capital leases		48,868			(124,515	)
Proceeds from bank loans, notes payable and capital leases		85,749			—
Interest paid		(~~166~~196,~~860~~419	)		(~~155~~159,~~249~~906	)
Payments relating to settlements of derivative financial instruments		—			(4,995	)
Payments of bank loans, notes payable and capital leases		(88,947	)		(293,478	)
Financing activities net cash flows		(117,992	)		(284,759	)
Payments relating to settlements of derivative financial instruments		—			(4,979	)
Net cash decreasing cash and cash equivalents		(47,497	)		(108,176	)
Financing activities net cash flows		(199,617	)		(458,363	)
Effects by changes in the cash and cash equivalents value:
Net cash increasing cash and cash equivalents		67,997			(36,781	)
Adjustment to cash flow as a result of changes in exchange rates		(1,933	)		(7,214	)
Adjustments to cash flow as a result of changes in exchange rates		(17	)		(9,201	)
Cash, cash equivalents at beginning of year		635,631			864,431
Cash, cash equivalents and restricted cash at beginning of year		635,631			864,431
Cash and cash equivalents at period end	Ps	586,201		Ps	749,041
Cash and cash equivalents and restricted cash at year end	Ps	703,611		Ps	818,449

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-5

ALESTRA, S. DE R. L. DE C. V. AND ~~SUBSIDIARIES~~SUBSIDIARY

Subsidiaries of Alfa S. A. B. de C. V.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts are expressed in thousands of adjusted nominal Mexican Pesos)

1. INCORPORATION AND ACTIVITY OF THE COMPANY

Alestra, S. de R. L. de C. V. (“Alestra”), is a Mexican company with limited liability and variable capital, incorporated on October 13, 1995, as a joint venture between Onexa, S. A. de C. V. (“Onexa”) (51%) and AT&T Telecom México, Inc. (“AT&T”) (49%).

Alestra’s business consists of the installation and operation of a public telecommunications network in Mexico, offering long distance telephone services and data, internet and local services.

In a general extraordinary meeting held on October 2, 2007, the stockholders approved the merger of Onexa into Alfa, S. A. B. de C. V., which became effective as of March 31, 2008. As a result of this merger, Alfa owns directly 51% of the shares of Alestra.

Alestra and its subsidiaries Servicios Alestra, S. A. de C. V. (“Servicios Alestra”) and Alestra Telecomunicaciones Inalámbricas, S. de R. L. de C. V. (“ATI”) are collectively referred to as the “Company.”

Alestra does not have any direct employees and all services required are provided by Servicios Alestra.

2. PREPARATION OF INTERIM FINANCIAL STATEMENTS

Basis of presentation and disclosures

The unaudited condensed consolidated financial statements of Alestra have been prepared in accordance with ~~Mexican~~ Financial Reporting ~~Standard~~Standards applicable in Mexico (“Mexican FRS”) ~~B-9 “Financial Information at Interim Dates”~~ as promulgated by the Mexican Financial Reporting Standards Board (“CINIF” ~~by its spanish acronym~~).

The unaudited condensed consolidated financial statements are expressed in Mexican Pesos (functional and reporting currency) denoted by the symbol “Ps.”. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by Mexican FRS.

The information included in the condensed consolidated financial statements is unaudited but reflects all adjustments (consisting only of normal recurring adjustments), which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. The results of these interim periods are not necessarily indicative of results for the entire year. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes as of December 31, 2010.

The unaudited condensed consolidated financial statements include those of Alestra and its subsidiaries, Servicios Alestra and ATI, of which Alestra holds 99% and 91% of their capital stock, respectively. All significant balances and transactions have been eliminated.

F-6

Estimates

The preparation of financial statements in conformity with Mexican FRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant estimates and assumptions include certain international long distance services revenues and expenses, the allowance for doubtful accounts, deferred income tax, provisions and employees benefits.

Recognition of the effects of inflation

~~According~~The ~~with the~~ provisions inof the Mexican FRS ~~“Inflation~~B-10 ~~Effects”~~specify ~~(Mexican~~that ~~FRS~~as ~~B-10)~~of 2008, the Mexican economy is ~~currently~~not inconsidered aan ~~non-~~inflationary environment, since ~~the~~there ~~accumulated~~has been a cumulative inflation ~~for~~ below 26% in the ~~past~~last three years ~~does~~(which ~~not~~is ~~exceed~~the ~~26%~~established ~~(maximum~~ limit to define ~~that~~ an economy ~~shall be considered~~ as ~~non-~~inflationary). Therefore, ~~from~~as ~~January~~of January 1, 2008 ~~onwards~~, itthe isCompany was required to ~~suspend~~discontinue the recognition of the ~~effects of~~ inflation oneffects in the financial information ~~(disconnection of the inflationary accounting)~~. Consequently, the financial statements as of March 31, 2010, ~~December 31, 2010~~ and ~~March 31,~~ 2011 are stated in adjusted nominal Mexican pesos as they include cumulative inflation effects on the financial information recognized up to December 31, 2007.

New Financial Reporting Standards

During December 2010 and 2009, the CINIF issued a series of Mexican FRS, which became effective as of January 1, 2011. The adoption of these Mexican FRS and interpretation did not have any significant impact on the financial information presented.

Mexican FRS B-5 “Financial Information by Segments”. It establishes the general standards to disclose financial information by segments. Additionally, it allows the users of such information to analyze the entity from the same point of view as management ~~does~~do and requires ~~management~~ to present financial information by segment consistently with its financial statements. With this standard, Bulletin B-5 “Financial Information by Segment” ~~was~~will be effective up to December 31, 2010. ~~The Company is evaluating the impact of this new Mexican FRS.~~

Mexican FRS B-9 “Financial Information at Interim Dates”. It establishes the guidance for the determination and presentation of financial information at interim dates which, among other things, requires the presentation of the statement of changes in stockholders’ equity and of cash flows which were not required by former Bulletin B-9 “Financial Information at interim dates” (effective up to December 31, 2010). ~~The Company has adopted the aforementioned dispositions and has presented the statements of changes in stockholder’s equity and of cash flows as requested by this standard.~~

Mexican FRS C-4 “Inventory”. ~~Requires~~Of retrospective application and establishes the particular standards of valuation, presentation and disclosure for the initial and subsequent recognition of inventory. Additionally, it removes the direct cost method as an allowed valuation system and the inventory cost allocation formula denominated as Last In First Out (LIFO). With this standard, Bulletin C-4 “Inventory” ~~remained~~remains effective up to December 31, 2010. ~~This Mexican FRS is not considered to have a significant impact in the financial information presented by the Company.~~

Mexican FRS C-5 “Advanced payments”. Requires retrospective application and establishes, among other things, the particular standards of valuation, presentation and disclosure related to ~~the~~ advanced payments line item. It also establishes that advanced payments for the purchase of inventory, real estate, machinery and equipment should be presented in the advanced payments line item and not in inventory or property, machinery and equipment as previously required. Additionally it establishes that advanced payments related to the acquisition of goods should be presented in the balance sheet in attention to the intended item classification, either in current or non-current assets. With this standard, Bulletin C-5 “Advanced payments” remains ~~remained~~ effective up to December 31, 2010. ~~The Company has adopted this Mexican FRS.~~

Mexican FRS C-6 “Property, plant and equipment”. Requires prospective application (except on disclosure aspects), and establishes, among other things, the particular standards of valuation, presentation and disclosure related to property, plant and equipment. It also establishes: a) that property, plant and equipment used to develop or maintain biological and extractive industries assets be under its scope, and b) the mandatory depreciation of representative components of property, plant and equipment, as opposed to depreciating the remaining asset as a single component. This Mexican FRS became effective as of January 1, 2011, with exception of the changes arising from the segregation of its components and which have a useful life clearly different to the main asset. In this case, and for entities which have not performed such segregation, the applicable disposition will become effective for periods beginning January 1, 2012. With this standard, Bulletin C-6 “Property, plant and equipment” remained effective up to December 31, 2010. This Mexican FRS is not considered to have a significant impact in the financial information presented by the Company.

F-7

Mexican FRS C-186 “~~Liabilities~~Property, ~~associated~~plant ~~to assets retirement~~ and ~~environmental restoration~~equipment”. Requires ~~retrospective~~prospective application (except on disclosure aspects), and establishes, among other things, the particular standards ~~for~~of ~~initial~~valuation, presentation and ~~subsequent~~disclosure ~~recognition~~related ofto aproperty, ~~provision~~plant ~~relative~~and toequipment. ~~liabilities~~It ~~associated~~also toestablishes: a) that property, plant and equipment ~~component~~used to ~~retirements~~develop asor ~~well~~maintain asbiological ~~the~~and ~~requirements~~extractive toindustries assets be ~~considered~~under ~~for~~its ~~valuation~~scope, and b) the mandatory depreciation of arepresentative ~~liability~~components ~~associated~~of property, plant and equipment, as opposed to depreciating the remaining asset as a single component. ~~retirement~~This ~~and~~Mexican FRS became effective as of January 1, 2011, with exception of the ~~disclosures~~changes ~~that~~arising ~~should~~from bethe ~~presented~~segregation byof anits ~~entity~~components ~~when~~and itwhich ~~has~~have a ~~liability~~useful ~~associated~~life clearly different to athe ~~component~~main ~~retirement~~asset. ~~This Mexican~~In ~~FRS~~this iscase, ~~not~~and ~~considered~~for toentities which have anot ~~significant~~performed ~~impact~~such insegregation, the ~~financial~~applicable ~~information~~disposition ~~presented~~will bybecome ~~the~~effective ~~Company~~for periods beginning January 1, 2012. With this standard, Bulletin C-6 “Property, plant and equipment” remains effective up to December 31, 2010.

Mexican FRS C-18 “Liabilities associated to assets retirement and environmental restoration”. Requires retrospective application and establishes, among other things, the particular standards for initial and subsequent recognition of a provision relative to liabilities associated to property, plant and equipment component retirements as well as the requirements to be considered for valuation of a liability associated to a component retirement and the disclosures that should be presented by an entity when it has a liability associated to a component retirement.

Reclassifications

Certain reclassifications of amounts previously reported have been made to the consolidated statement of cash flow for the period ended ~~March 31~~June 30, 2010 to maintain consistency and comparability between periods presented, as shown below:

	Originallyreported			Reclassification			~~March~~June 3130, 2010
Operating activities net cash flows
Other, net	Ps	52,~~981~~995		Ps	~~721~~5,031		Ps	68,~~702~~026
Gain on sale of equipment		43			514			557
Exchange gain		(94,585	)		(5,031	)		(99,616	)
Exchange gain		(144,406	)		(1,235	)		(145,641	)
Increase in accounts receivable and other current assets		(218,679	)		106,985			(111,785	)
Increase in accounts receivable and other current assets		(180,378	)		76,294			(104,084	)
Income tax paid		—			106,985			(106,985	)
Income tax paid		—			(76,294	)		(76,294	)
Operating activities net cash flows	(Ps	310,269	)	Ps	—		(Ps	310,269	)
Operating activities net cash flows	(Ps	318,760	)	Ps	—		(Ps	318,760	)
Financing activities net cash flows
Proceeds from bank loans, notes payable and capital leases	Ps	—		Ps	85,749		Ps	85,749
Payments of bank loans, notes payables and capital leases		(3,198	)		(85,749	)		(88,947	)
	(Ps	3,198	)	Ps	—		(Ps	3,198	)

3. PROPERTY AND EQUIPMENT, NET

As of December 31, 2010 and ~~March~~June 3130, 2011, property and equipment net, consists of the following:

	2010			2011
Buildings	Ps	224,817		Ps	~~235~~236,~~888~~049
Furniture, fixtures and other		233,114			~~229~~225,~~178~~966
Hardware equipment		354,437			~~348~~356,~~054~~900
Transportation equipment		33,044			3230,~~042~~816
Telephone network		10,243,017			10,~~321~~359,~~862~~953
Leasehold improvements		67,583			67,~~885~~888
Billing and customer care software		562,253			562,253
		11,718,265			11,~~797~~839,~~162~~825
Accumulated depreciation and amortization		(7,101,556	)		(7,~~265~~372,~~405~~404	)
		4,616,709			4,~~531~~467,~~757~~421
Land		165,039			165,039
Constructions in progress		296,220			~~328~~326,~~235~~076
Total	Ps	5,077,968		Ps	54,~~025~~958,~~031~~536

Amortization of billing and customer care software charged to income amounted to ~~Ps1~~Ps3,~~912~~566 and ~~Ps1~~Ps2,~~361~~722 for ~~the~~ the periods ended ~~March~~June 3130, 2010 and 2011, respectively.

Depreciation charged to income, not including amortization of ~~the~~ the billing and customer care software mentioned above, was ~~Ps189~~Ps380,~~718~~675 and ~~Ps187~~Ps372,~~268~~189 for the periods ended ~~March~~June 31, 2010 and 2011, respectively.

F-8

4. BANK LOANS, NOTES PAYABLE AND CAPITAL LEASES

As of December 31, 2010 and ~~March~~June 3130, 2011, bank loans, notes payable and capital leases consist of the following:

	2010			2011
Bank loan obtained from Comerica Bank for an amount of US$10 million (1)	Ps	123,571		Ps	~~119~~118,~~678~~389
Promissory notes to Cisco Systems Capital Corporation for an amount of US$37.2 million (2)		238,243			~~164~~47,~~463~~475
Promissory notes to Hewlett Packard Operations de México, S. de R. L. de C. V., for an amount of US$18.8 million. (3)		136,282			7825,~~218~~149
Promissory notes to Huawei Tecnologies de México, S. A. de C. V. for an amount of US$3.5 million. (4)		28,798			2420,~~404~~693
		526,894			~~386~~211,~~763~~706
Current portion of bank loans, notes payable and capital leases		(216,957	)		(~~174~~104,~~973~~169	)
Long term debt	Ps	309,937		Ps	~~211~~107,~~790~~537

(1) On September 27, 2010 the Company signed a new loan agreement with Comerica Bank (“Comerica”) for US$10 million bearing interest at 3-month adjusted LIBOR rate plus 3.75%. Interest are payable quarterly and principal is payable in four equal installments of US$2.5 million in March 31, 2012, June 30, 2012, September 30, 2012 and December 31, 2012. This loan agreement contains various covenants ~~with~~ which, as of ~~March~~June 3130, 2011, and the date of the issuance of the ~~condensed~~ financial statements, the Company is in full compliance.

(2) The Company issued ten promissory notes for a total amount of US$37.2 million to acquire goods with its supplier Cisco Systems Capital Corporation. Each note has a maturity of 36 months at an annual interest rates between 5.15% and 5.67%. ~~The~~However, ~~amount due~~ as of ~~March~~May 3130, 2011, ~~was~~9 promissory notes were paid in full, the remaining balance amount US$134.70 million with a maturity on July 6, 2013, bearing interest at an annual interest rate of 5.15%.

(3) From October 1, 2008 to March 31, 2010, the Company signed five promissory notes with Hewlett Packard Operations de México, S. de R. L. de C. V. (“HP”), for the acquisition of goods for a total amount of US$18.8 million. The payments will be made on a monthly basis in 48 installments and annual interest rates between 5.21% and 7.082%. AsHowever, as of ~~March~~June 3114, 2011, 9 promissory notes were paid in full, the ~~amount~~remaining ~~due~~balance ~~was~~amount US$62.51 million with a maturity on February 28, 2014, bearing interest at an annual interest rate of 5.21%.

(4) On January 11st, 2010, the Company signed a promissory note with Huawei Technologies de México S. A. de C. V. (“Huawei”), for the acquisition of goods for a total amount of US$3.5 million. The payments will be made quarterly at an annual interest rate of 5.50%. As of ~~March~~June 3130, 2011, the amount outstanding was US$21.08 million.

5. SENIOR NOTES

On August 11, 2009 the Company performed a debt offering by issuing unsecured senior notes for a total amount of US$200 million. The senior notes bear interest at annual rate of 11.750% payable semi-annually in cash on February and August of each year with a maturity on August 11, 2014 (“11.750% Senior Notes”). The 11.750% Senior Notes principal will be paid at maturity and is presented as long-term in the balance sheet.

The proceeds obtained in the issuance of the 11.750% Senior Notes were used to refinance the Company’s 8% Senior Notes due June 2010 (“8% Senior Notes”).

On October 7, 2009, the Company filed a registration statement on Form F-4 in order to register its offer to exchange its outstanding 11.750% Senior Notes due 2014 with new notes that have been registered under the U.S. Securities Act of 1933, as amended. This registration statement became effective on January 6, 2010.

F-9

The costs and expenses, including the placing of premiums and discounts of this new issuance, which at December 31, 2009 amounted to Ps66,166 (US$5.1 million), will be amortized over the life of the 11.750% Senior Notes. The unamortized costs and expenses of the 8% Senior Notes due 2010, amounting to Ps19,229 at December 31, 2009, were charged to income for the year and are presented in the statement of operations as other income (expense).

The Company may redeem, at any time, the 11.750% Senior Notes, in whole but not in part, by paying the greater of 100% of the principal amount of such notes and the sum of the present value of each remaining scheduled payment of principal and interest discounted to the redemption date on a semi-annual basis at the Treasury Rate (as defined in the indenture for the 11.750% Senior Notes) plus 50 basis points, in each case plus accrued and unpaid interest. In addition, prior to or on August 11, 2012, the Company may redeem up to 35% of the original principal amount of the 11.750% Senior Notes with the net proceeds from certain equity offerings by the Company, at a price of 111.75% of the aggregate principal amount thereof, plus accrued and unpaid interest.

In the event of a change in the Company’s control structure, for example in the case of change of the interest ownership partners of the Company and with certain exceptions, the holders of the 11.750% Senior Notes are entitled to demand that the Company repurchase the notes in cash, at a price equal to 101% of the principal amount plus unpaid accrued interest.

The indenture for the 11.750% Senior Notes and other credit agreements contain various debt covenants including limitations on the sale of assets and affiliate transactions, among others. In addition, these covenants require the Company to have a certain leverage ratio prior to being able to enter into additional debt transactions. As of ~~March~~June 3130, 2010, ~~December 31, 2010~~ and ~~March 31,~~ 2011 the Company is in compliance with all required covenants.

6. EMPLOYEES’ BENEFITS

An analysis of the ~~period~~ net periodic pension cost by plan type is presented as follows:

Pension PlanMarch 31,

SeniorityPremiumMarch 31,

IndemnitiesMarch 31,

OtherretirementbenefitsMarch 31,

TotalMarch 31

Pension PlanJune 30,

SeniorityPremiumJune 30,

IndemnitiesJune 30,

OtherretirementbenefitsJune 30,

TotalJune 30

2010

2011

2010

2011

2010

2011

2010

2011

2010

2011

Net cost of the period:

Labor cost of the current service

~~571~~1,143

~~462~~923

4283

4591

~~818~~1,636

~~849~~1,698

2347

12,~~437~~868

12,~~379~~759

Financial cost

13,~~742~~484

12,~~247~~494

3876

3671

~~882~~1,734

~~753~~1,458

71143

25,~~681~~313

24,~~107~~166

Net actuarial earning or loss

3877

—

3571

2959

—

61123

73148

90182

Labor cost of past service

(~~165~~329

)

(~~160~~320

)

1122

~~756~~1,511

—

~~602~~1,204

~~607~~1,213

Total

24,~~186~~375

13,~~549~~097

~~126~~252

~~121~~243

24,~~456~~881

24,~~358~~667

~~155~~313

49,~~793~~533

48,~~183~~320

F-10

7. INCOME TAX

The reconciliation between the statutory and effective income tax rates is shown below:

	Three months ended March 31,
	Six months ended June 30,
	2010			2011
Income before income tax	Ps	~~187~~183,~~230~~134		Ps	~~168~~298,~~387~~583
Statutory tax rate		30	%		30	%
Income tax at statutory rate		(5654,~~169~~940	)		(5089,~~516~~575	)
Add (deduct) effect of income tax on:
Inflationary tax adjustment		(118,~~614~~034	)		(37,~~645~~333	)
Other permanent items:
Tax effect from indexing of non-deductible fixed assets		—			1939,~~875~~337
Others		~~406~~67,038			(616,~~118~~486	)
Subtotal		~~(67,377~~	)		(4074,~~404~~057	)
Effect in the current income tax provision due to amortization of tax loss carryforwards reserved in prior years		100,130			2,968
Effect in the current income tax provision due to amortization of tax loss carry forwards reserved in prior years		—			6,927
Total provision of income tax charged to income	Ps	32,753		Ps	(37,436	)
Total provision of income tax	Ps	4,064		Ps	(67,130	)

For the ~~three~~six months ended ~~March~~June 3130, 2010, the company recognized its income tax provision using an income tax effective rate of -182.2% compared to an income tax effective rate of 22.7% for the ~~three~~six months ended ~~March~~June 3130, 2011.

8. CONTINGENCIES AND COMMITMENTS

In August 2006, ABA Seguros, S. A. de C. V. (“ABA Seguros”) and 7 ELEVEN, Inc. (“7-Eleven”) filed a claim against Servicios Alestra in the amount of Ps 50,000, for damages from a fire that began in the building leased by Servicios Alestra to Casa Chapa, S. A. de C. V. under the theory of subrogation of rights. Servicios Alestra filed a response with the support of ACE Seguros (insurance carrier of Servicios Alestra), since ACE Seguros is the party that would pay should Servicios Alestra be found liable. In order to examine Servicios Alestra’s responsibility, ABA Seguros, 7-Eleven and Servicios Alestra sought the opinions of five experts in the following areas: (i) damages valuation, (ii) insurance settlement, (iii) fires, (iv) accounting, and (v) electrical installation. On July 27, 2010, a civil federal judge decided to acquit Servicios Alestra of any responsibility; however, on August 11, 2010, ABA Seguros and 7-Eleven appealed such resolution. Although the outcome of the ~~claim~~appeal has not yet been decided, Servicios Alestra does not believe it would have a substantial effect on its ~~financial results~~finances. In the Company’s opinion, although the outcomes of these proceedings are uncertain, ~~these~~they should not have a material adverse ~~effect~~affect on its financial position, results of operations or cash flows.

The Company is involved in a dispute with Teléfonos de México, S.A.B. de C.V. (“Telmex”) regarding to fixed interconnection services rates applicable for 2008, 2009, 2010 and ~~2010~~2011. The Company is also in disputes with Radiomóvil Dipsa, S.A de C.V (Telcel) and ~~had~~mobile ~~requested~~companies from ~~the~~Grupo ~~intervention~~Telefonica of(Telefonica) ~~Cofetel~~regarding to mobile interconnection services rates for 2011. As of the date of ~~these~~issuance ~~condensed~~of these financial statements, management continues its negotiations with Telmex, Telcel and Telefonica and it is expected that the Company may reach an agreement in the near future. In the Company’s opinion, although the outcomes of ~~these~~the mentioned proceedings are uncertain, they should not have a material adverse effect on its financial results ~~in excess of the amounts accrued~~; however, as of the date of ~~these~~issuance ~~condensed~~of these financial statements, the Company believes that it has recognized sufficient provisions to address such contingencies.

9. SEGMENTS

The reported segments of the Company represent the specific types of telecommunications services and products that the Company offers and internally analyzes.

The Company operates in two ~~main~~ segments: long distance services (domestic and international), and data, internet and local services. ~~These segments are managed separately due to product differences.~~

F-11

The Company’s management uses the information ~~regarding~~as to income and costs of services (excluding depreciation ~~and amortization~~) by segment to evaluate performance, make general operations decisions and assign resources. Telecommunications services are generally offered using networks owned by the Company and leased (interconnection) networks that make no distinction between the different kinds of services. As a result, the Company does not assign total assets, administration, selling and other operating expenses, ~~and~~ depreciation and amortization per segment.

Three months ended	Long distance			Data, InternetandLocal services			Total
March 31, 2010
Revenues	Ps	281,290		Ps	835,054		Ps	1,116,344
Costs of services (excluding depreciation and amortization)		(170,794	)		(203,043	)		(373,837	)
Gross profit	Ps	110,496		Ps	632,011			742,507
Operating expenses (including depreciation and amortization)								(603,499	)
Operating income								139,008
Comprehensive financial result								55,270
Other expense, net								(7,048	)
Income before income tax								187,230
Income tax								32,753
Consolidated net income								219,983
Net (loss) attributable to non controlling interest								(1	)
Net income attributable to total stockholders of Alestra							Ps	219,982
Three months ended	Long distance			Data, InternetandLocal services			Total
March 31, 2011
Revenues	Ps	246,374		Ps	914,732		Ps	1,161,106
Costs of services (excluding depreciation and amortization)		(136,567	)		(235,537	)		(372,104	)
Gross profit	Ps	109,807		Ps	679,195			789,002
Operating expenses (including depreciation and amortization)								(608,272	)
Operating income								180,730
Comprehensive financial result								790
Other expense, net								(13,132	)
Income before income tax								168,388
Income tax								(37,436	)
Consolidated net income								130,952
Net (loss) attributable to non controlling interest								(1	)
Net income attributable to total stockholders of Alestra							Ps	130,951

Accounting policies of the segments are the same as those described in the summary of significant accounting policies in our financial statements as of and for the year ended December 31, 2010. The information on the Company’s segments for the six months ended June 30, 2010 and 2011 is as follows:


Six months ended	Long distance			Data, Internet and Local services			Total
June 30, 2010
Revenues	Ps	556,622		Ps	1,686,232		Ps	2,242,843
Costs of services (excluding depreciation and amortization)		(339,287	)		(413,265	)		(752,552	)

Gross profit	Ps	217,324		Ps	1,272,967			1,490,291

Operating expenses (including depreciation and amortization)								(1,209,850	)

Operating income								280,441
Comprehensive financial result								(88,755	)
Other expense, net								(8,552	)

Income before income tax								183,134
Income tax								4,064

Consolidated net income								187,198
Net loss attributable to total stockholders of Alestra								(1	)

Net income attributable to total stockholders of Alestra							Ps	187,197


Six months ended	Long distance			Data, Internet and Local services			Total
June 30, 2011
Revenues	Ps	484,342		Ps	1,818,291		Ps	2,302,633
Costs of services (excluding depreciation and amortization)		(264,182	)		(449,665	)		(713,847	)

Gross profit	Ps	220,160		Ps	1,368,626			1,588,786

Operating expenses (including depreciation and amortization)								(1,223,414	)

Operating income								365,372
Comprehensive financial result								(42,944	)
Other expense, net								(23,845	)

Income before income tax								298,583
Income tax								(67,130	)

Net income								231,453
Net loss attributable to total stockholders of Alestra								(1	)

Net income attributable to total stockholders of Alestra							Ps	231,452

F-12

10.	SUBSEQUENT EVENT

~~On April 14, 2011, the Company entered into an equity purchase agreement with~~ AT&T~~, AT&T Mexico and Alfa, pursuant to which Alfa has agreed to acquire AT&T Mexico’s 49% equity~~ interest in the company (the “Equity Purchase Agreement”). On April 14, 2011, the Company also entered into a nodes purchase agreement with AT&T, AT&T Mexico and Alfa, pursuant to which AT&T Mexico has agreed to purchase from the Company the telecommunications nodes and customer equipment (the “Nodes”) required for the provision of AT&T Global Services in Mexico (the “Nodes Purchase Agreement” and, together with the Equity Purchase Agreement, the “AT&T Transactions~~”).~~

~~Consummation~~On ofJuly 12, 2011, Alfa terminated the ~~AT&T~~joint ~~Transactions~~venture isagreement ~~subject~~entered tointo ~~customary~~between ~~conditions,~~AT&T Telecom ~~including:~~México, Inc. (i“AT&T México”) ~~receipt~~, ofAlfa ~~certain~~and ~~regulatory~~the ~~approvals;~~Company, ~~(ii)~~as amended on November ~~absence~~30, of2005, ~~any~~and ~~law~~the orequity ~~order~~purchase ~~prohibiting~~agreement ~~the~~entered ~~closing~~into ofbetween ~~the~~AT&T ~~transactions;~~Corp. (~~iii~~“AT&T”) ~~subject~~, toAT&T ~~certain exceptions~~México, ~~the~~Alfa ~~accuracy~~and ofthe Company ~~representations~~on ~~and~~April 14, ~~warranties;~~2011 and ~~(iv) payment~~ ofcompleted ~~certain~~the ~~amounts~~acquisition ~~due~~of to AT&T ~~and~~Mexico’s ~~AT&T~~49% equity interest in the Company after receiving approval from regulatory authorities in Mexico. ~~The~~Following ~~AT&T~~the ~~Transactions~~closing ~~are~~of ~~expected~~these totransactions, ~~close~~which were originally announced in April 2011, Alfa is now the ~~second~~sole ~~half~~shareholder of ~~2011~~Alestra.

~~Upon~~In ~~the~~addition, ~~consummation~~on ofJuly 12, ~~the AT&T Transactions~~2011, ~~(i) Alfa~~the Company ~~will~~entered ~~own~~into ~~100%~~the ofnodes ~~the~~purchase ~~Company~~agreement ~~equity~~with ~~interests~~AT&T, ~~(ii) Alfa &~~ AT&T ~~Mexico~~México ~~will~~and ~~terminate the Joint Venture Agreement~~Alfa, ~~and (iii) the~~pursuant ~~Company~~to ~~and~~which AT&T ~~Mexico~~México ~~will~~purchased ~~enter~~from ~~into~~the anCompany ~~Equipment~~the ~~Lease~~telecommunications ~~Agreement~~nodes ~~pursuant~~and tocustomer ~~which~~equipment ~~Alestra will lease from AT&T Mexico~~ (the “Nodes ”) required for the provision of AT&T Global Services in Mexico (the “~~Equipment~~Nodes ~~Lease~~ Purchase Agreement”) ~~until December 31, 2012~~. The Equipment Lease Agreement is subject to early termination if AT&T Mexico acquires the necessary licenses and regulatory approvals to offer, directly and independently from the Company, AT&T Global Services within Mexico, prior to December 31, 2012.

~~Upon~~On July 12, 2011, the ~~termination~~Company ofalso ~~the~~entered into an Equipment Lease Agreement~~, (i) the~~ ~~Company~~with ~~and~~ AT&T ~~will~~México ~~terminate~~pursuant ~~the~~to ~~AGN~~which ~~Agreement~~the ~~prior~~Company tolease ~~its~~from ~~June 30,~~AT&T ~~2013~~México ~~expiration~~the ~~date~~Nodes ~~and~~required ~~(ii)~~ for the ~~Company~~provision ~~and~~of AT&T Global ~~Network~~ Services in Mexico S.(the “Equipment deLease ~~R.L.~~Agreement”) deuntil CDecember 31, 2012.V. ~~(“AGNS~~The ~~Mexico”)~~Equipment ~~will~~Lease ~~enter~~Agreement ~~into several~~is ~~commercial~~subject ~~agreements~~to ~~pursuant~~early totermination ~~which~~if ~~the~~AT&T ~~Company~~acquires ~~will~~the ~~provide~~necessary ~~certain~~licenses ~~telecommunication~~and ~~services~~regulatory approvals to ~~AGNS~~offer, directly and independently from the Company, AT&T Global Services within Mexico, with AT&T México.

~~After~~Upon the termination of the ~~AGN~~Equipment Lease Agreement, ~~following~~(i) the ~~consummation~~Company ofand ~~the~~ AT&T ~~Transactions,~~México will terminate the ~~Company~~brand ~~will~~name nouse ~~longer~~agreement ~~provide~~ between AT&T and us, the AT&T Global ~~Services~~Network Cooperation Agreement (the “AGN Agreement”) prior to its June 30, 2013 expiration date and (ii) the Company will beenter ~~required~~into several commercial agreements pursuant to ~~cease~~which ~~using~~the ~~any~~Company ofwill provide certain telecommunication services to AT&T’s ~~intellectual property~~México.

After the termination of the AGN Agreement, Alestra will no longer provide AT&T Global Services in Mexico and will be required to cease using any of AT&T’s intellectual property.

Dividends

On July 6, 2011 and July 8, 2011, the Company paid a US$ 10 million dividend, the second installment of a US$ 15 million dividend declared in a shareholders meeting held on December 21, 2009. In addition, in a general ordinary meeting held on July 19, 2011 the shareholders declared and the Company paid a dividend of US$ 9 million.

F-13

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


Alestra, S. de R.L. de C.V.

		/s/ Bernardo García Reynoso
		Bernardo García Reynoso Chief Financial and Administrative Officer

Date: ~~May~~ August 3130, 2011

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Filing Compare · ALESTRA