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JSFC Sistema (SSA)

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Monday 23 November, 2009

JSFC Sistema

Sistema Signs Memorandum of Understanding with ...

Sistema Signs Memorandum of Understanding with Svyazinvest and Comstar-UTS on the Reorganization of Assets

JSFC Sistema

SISTEMA SIGNS MEMORANDUM OF UNDERSTANDING WITH SVYAZINVEST AND COMSTAR-UTS

ON THE REORGANIZATION OF ASSETS

Moscow, Russia – 23 November, 2009 – Sistema (the “Group”) (LSE: SSA), the largest diversified public financial corporation in Russia and the CIS, which invests in and is a major shareholder of companies operating in different industries, today announced that it has signed a non-binding Memorandum of Understanding (“MOU”) with JSC Svyazinvest and Comstar-UTS, indirect subsidiary of Sistema, and initiated the negotiations process over the reorganisation of certain assets. The outcome of these negotiations may result in the disposal of Sistema’s stake in CJSC Sky Link, the sale of Comstar-UTS’s stake in JSC Svyazinvest, and the increase of Comstar-UTS’s ownership in JSC Moscow City Telephone Network (“MGTS”).

Comstar-UTS currently owns 25% +1 share of Svyazinvest and a 55.7% stake in MGTS, whilst Sistema holds a 50% stake in CJSC Sky Link. Svyazinvest owns a 23.3% stake in MGTS. According to the MOU, Sistema may potentially sell its stake in Sky Link, whilst Comstar-UTS may dispose of its stake in Svyazinvest and acquire Svyazinvest’s holding in MGTS. Furthermore, according to the MOU, all parties may restructure the outstanding debt in relation to these transactions.

The exact terms and conditions of these transactions are subject to further negotiations and will be determined in separate binding legal agreements between the above mentioned and other potentially interested parties. The completion of these transactions is subject to certain conditions, including receiving necessary approvals from the regulatory bodies and obtaining a valuation. No assurance can be given that any of the parties to this MOU will execute definitive agreements or that any of the contemplated transactions will occur.

This press release is being issued to ensure compliance with the London Stock Exchange rules.

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

Sistema Investor Relations             Shared Value Limited
Pavel Kim Larisa Kogut-Millings
Tel: +7 495 692 22 88 Tel: +44 (0) 20 7321 5010

ir@sistema.ru

sistema@sharedvalue.net

Sistema is the largest public diversified financial corporation in Russia and the CIS, which manages companies serving over 100 million customers in the sectors of telecommunications, high technology, oil and energy, radars and aerospace, banking, retail, mass-media, tourism and healthcare services. Founded in 1993, the company reported revenues of US$ 4.2 billion for the second quarter of 2009, and total assets of US$ 33.8 billion as at June 30, 2009. Sistema’s shares are listed under the symbol “SSA” on the London Stock Exchange, under the symbol “AFKS” on the Russian Trading System (RTS), under the symbol “AFKC” on the Moscow Interbank Currency Exchange (MICEX), 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. 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. In addition, there is no assurance that the new contracts entered into by our subsidiaries referenced above will be completed on the terms contained therein or at all. 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.