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JSFC Sistema (SSA)

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Wednesday 14 December, 2005

JSFC Sistema

Statement re Possible Offer

JSFC Sistema

  Comstar UTS Announces Terms of Public Share Purchase Offer to MGTS

Comstar United TeleSystems (Comstar UTS) today announced the terms of its public
share purchase offer to Moscow City Telephone Network (MGTS) shareholders,
approved by the Board of Directors of Comstar UTS on December 7, 2005 and valid
as of today. This public offer is only made to the holders of common shares of

Having acquired 55.62% of the outstanding common shares of MGTS, as previously
announced on November 22, 2005, Comstar UTS is required under Article 80 of the
Russian Federal Law on Joint Stock Companies to make such an offer to common
shareholders of MGTS since Comstar UTS is now the beneficial owner of more than
30% of the company. The Board of Directors of Comstar UTS has approved an offer
of RUR 490 (equivalent to approximately $17.065)* per one common share of MGTS.
The offer price is based on the weighted average market price of MGTS common
shares for the six months prior to the acquisition of the stake in MGTS by
Comstar UTS as calculated by an independent appraiser.

Shareholders of MGTS may accept this offer within 30 days of receipt of official
notification. Comstar UTS neither encourages nor discourages MGTS' shareholders
from accepting this offer and does not provide a recommendation of any kind.

Comstar UTS has established a hotline (+7 495 225-2261) in order to inform the
shareholders of MGTS of the details of the share purchase offer and their
actions should they decide to accept the offer.

* All payments will be made in Russian rubles only and the US dollar equivalent
is stated for information purpose only. The exchange rate was set by the Central
Bank of Russian Federation as of 14.12.2005.

For further information, please visit and or

Sistema Investor Relations  Comstar UTS                Shared Value Limited
Alexei Kurach               Veniamin Kofman            Matthew Hooper
Tel: +7 095 229 2741        Tel: +7 095 956 2170       Tel. +44 (0) 20 7321 5023 

Sistema is the largest private sector consumer services company in Russia and
the CIS, with over 50 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$ 3.4 billion for the
first six months of 2005, and total assets of US$ 11.6 billion as at June 30,
2005. 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 'SIST' 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 or Comstar UTS. 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 or Comstar UTS and
their operations.