Moscow, Russian Federation – Mobile TeleSystems OJSC (“MTS” or the “Company” – NYSE: MBT), the leading telecommunications provider in Russia and the CIS, announces that its wholly-owned subsidiary, Telecom Povolzhye LLC, has acquired Penza-GSM CJSC, SMARTS-Ivanovo CJSC and SMARTS-Ufa CJSC, the regional assets of SMARTS OJSC, a mobile operator active in the Volga and Central Regions. In total, MTS has acquired the three companies for a price of RUB 3.13 bln including debt.

The acquisition primarily will enhance MTS’s spectrum resources in a number of key regions. Penza-GSM CJSC owns 14.8 MHz in the 1800 Mhz range and 6.2 MHz in the 900 MHz range. SMARTS-Ivanovo CJSC owns 14.2 MHz in the 1800 MHz range and 10.0 MHz in the 900 MHz range, and SMARTS-Ufa CJSC owns 14.6 MHz in the 1800 MHz range.

Mr. Andrei Dubovskov, President and CEO of MTS, commented, “The transaction allows MTS to sustain its leadership in the Bashkiria market and significantly increase its presence in Penza Region and Ivanovo Region. MTS will also benefit from obtaining additional spectrum resources in the 900 MHz and 1800 MHz ranges, which provides a greater potential for refarming the 1800 MHz bandwidth for LTE networks. This will allow us to offer improved coverage and faster speeds for mobile broadband to our subscribers. We also believe that the acquisition will help us realize substantial economies of scale upon integration of the acquired businesses in the MTS Group.”

MTS has received approvals of the Federal Antimonopoly Service (FAS) and all of the necessary corporate approvals.

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For further information, please contact in Moscow:

Joshua B. Tulgan
Director, Department of Corporate Finance and Investor Relations
Mobile TeleSystems OJSC
Tel: +7 495 223 2025
E-mail: ir@mts.ru