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JSFC Sistema (SSA)

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Monday 28 February, 2005

JSFC Sistema

Statement re Sistema Increases Ownership in Ope...

JSFC Sistema
                  

SISTEMA INCREASES OWNERSHIP IN OPERATING COMPANIES

Sistema, the largest private sector consumer services company in Russia and the
CIS, today announced that it has increased its ownership in the Mezhregionalny
Transit Telecom ('MTT') and Moscow Bank for Reconstruction and Development
('MBRD') operating companies.

Sistema has acquired an additional 5% equity stake in Mezhregionalny Transit
Telecom, which operates a nationwide transit network providing
telecommunications services and network interconnection for mobile and fixed
line network operators throughout Russia, for a cash consideration of
approximately US$ 6.4 million. This transaction has increased Sistema's voting
interest in MTT to 50% and Sistema will continue to report its share of earnings
in MTT as an affiliate.

The company has also completed the purchase of a 13.33% equity stake in the
Moscow Bank for Reconstruction and Development, which has over 4,715 corporate
banking customers and also provides retail banking services through its local
branches in Moscow and other major cities across Russia. The total consideration
amounted to approximately US$ 10 million, including a cash payment of US$ 2.1
million and promissory notes in the amount of US$ 7.9 million. As a result of
this transaction, Sistema's voting interest in MBRD has increased to 98.9% of
the company's share capital.

***

For further information, please visit www.sistema.ru or contact:

Sistema Investor Relations 
Andre Bliznyuk 
Tel: +7 095 730 1543 
bliznyuk@sistema.ru 

Shared Value Limited
Matthew Hooper
Tel: +44 (0) 20 7321 5023
sistema@sharedvalue.net

***

Sistema is the largest private sector consumer services company in Russia and
the CIS, with over 35 million customers. Sistema develops and manages
market-leading businesses in selected service-based industries, including
telecommunications, technology, insurance, banking, real estate, retail and
media. Founded in 1993, the company reported revenues of US$ 4.1 billion for the
first nine months of 2004 and total assets of US$ 7.7 billion as at September
30, 2004. Sistema's shares are listed under the symbol 'SSA' on the London Stock
Exchange, under the symbol 'AFKS' on the Russian Trading System (RTS), and under
the symbol 'SUST' on the Moscow Stock Exchange (MSE).

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 Sistema. You can identify forward looking statements by terms
such as 'expect,' 'believe,' 'anticipate,' 'estimate,' 'intend,' 'will,'
'could,' 'may' or 'might' 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 intend to
update these statements to reflect events and circumstances occurring after the
date hereof or to reflect the occurrence of unanticipated events. Many factors
could cause the actual results to differ materially from those contained in our
projections or forward-looking statements, including, among others, general
economic conditions, our competitive environment, risks associated with
operating in Russia, rapid technological and market change in our industries, as
well as many other risks specifically related to Sistema and its operations.

This press release is not an offer for sale of any securities in the United
States. Any securities may not be offered or sold in the United Sates absent
registration or an exemption from registration under the U.S. Securities Act of
1933, as amended. Sistema has not registered and does not intend to register any
portion of any offering in the United States or to conduct a public offering of
any securities in the United States.

This communication is directed only at (i) persons who are outside the United
Kingdom or (ii) investment professionals falling within Article 19(5) of the
Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 (the
'Order') and (iii) high net worth entities, and other persons to whom it may
lawfully be communicated, falling within Article 49(2) of the Order (all such
persons together being referred to as 'relevant persons'). Any investment
activity to which this communication relates will only be available to and will
only be engaged with, relevant persons. Any person who is not a relevant person
should not act or rely on this document or any of its contents.
Stabilization/FSA.

This press release is not a public offer or advertisement of securities in the
Russian Federation, and is not an offer, or an invitation to make offers, to
purchase any securities in the Russian Federation.