MTS Board Approves Acquisition of Sistema Inventure

15 September 2011

Moscow, Russian Federation – Mobile TeleSystems OJSC (“MTS” or the “Company” – NYSE: MBT), the leading telecommunications provider in Russia and the CIS, announces that MTS Board of Directors has approved the acquisition by MTS subsidiaries of a 100% stake in Sistema Inventure which directly owns 29% of the voting stock of Moscow City Telephone Network (“MGTS”).

Under the proposed terms, subsidiaries of MTS would acquire for RUB 10.56 billion a 100% stake in wholly owned JSFC Sistema’s subsidiary Sistema Inventure, which in addition to its stake in MGTS has RUB 10.44 billion1 of debt owed to Sistema. Upon completion of the transaction, MTS’s ownership stake in MGTS would rise to 99.1% of ordinary shares and 69.7% of preferred shares, which total 94.1% of MGTS charter capital.

Approval of the transaction by the MTS Board of Directors follows the recommendation of the Special Committee of three independent directors overseeing the transaction process. Citigroup Global Markets Limited is acting as financial advisor and has provided a fairness opinion to the Special Committee. Cleary Gottlieb Steen & Hamilton is acting as legal advisor to the Special Committee. Tax and financial due diligence was conducted by Ernst & Young.

The deal is still to be approved by Sistema’s Board of Directors. The acquisition has already been approved by the Federal Antimonopoly Service (FAS). The transaction is subject to documentation and is expected to be completed by the end of the year.

* * *

For further information, please contact in Moscow:

Joshua B. Tulgan
Director, Investor Relations
Acting Director, Corporate Finance

Department of Investor Relations
Mobile TeleSystems OJSC
Tel: +7 495 223 2025

Learn more about MTS. Visit the official blog of the Investor Relations Department at

1Calculated under Russian Accounting Standards

* * *

Mobile TeleSystems OJSC ("MTS") is the leading telecommunications group in Russia, Eastern Europe and Central Asia, offering mobile and fixed voice, broadband, pay TV as well as content and entertainment services in one of the world's fastest growing regions. Including its subsidiaries, the Group services over 100 million mobile subscribers. The Group has been awarded GSM licenses in Russia, Ukraine, Uzbekistan, Turkmenistan, Armenia and Belarus, a region that boasts a total population of more than 230 million. Since June 2000, MTS' Level 3 ADRs have been listed on the New York Stock Exchange (ticker symbol MBT). Additional information about the MTS Group can be found at

* * *

Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of MTS, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify forward looking statements by terms such as “expect,” “believe,” “anticipate,” “estimate,” “intend,” “will,” “could,” “may” or “might,” and the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not undertake or intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. We refer you to the documents MTS files from time to time with the U.S. Securities and Exchange Commission, specifically the Company’s most recent Form 20-F. These documents contain and identify important factors, including those contained in the section captioned “Risk Factors” that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, the severity and duration of current economic and financial conditions, including volatility in interest and exchange rates, commodity and equity prices and the value of financial assets; the impact of Russian, U.S. and other foreign government programs to restore liquidity and stimulate national and global economies, our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so, strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses, including Comstar-UTS, potential fluctuations in quarterly results, our competitive environment, dependence on new service development and tariff structures, rapid technological and market change, acquisition strategy, risks associated with telecommunications infrastructure, governmental regulation of the telecommunications industries and other risks associated with operating in Russia and the CIS, volatility of stock price, financial risk management and future growth subject to risks.

* * *


Contact investor relations:

+ 7 495 223 20 25

MTS Investor Relations
App for iPad