Moscow, Russia - 30 July - OJSC Sistema-Hals (LSE: HALS), the largest diversified company in the Russian and CIS real estate market, announces today that its Board of Directors has approved a deal to complete a credit agreement with VTB Bank.

Under the terms of the deal VTB will provide Sistema-Hals with financing of up to U$500 million for a period of five years. These credit resources will be used to refinance bridging loans which were obtained before Sistema-Hals' IPO from Deutsche Bank, UBS and Nomura International, as well as to finance the company's current investment programme. The effective interest rate, inclusive of all commission, is 8.5% APR.

Michael Golomb, Vice-President of Finance and Investment of Sistema-Hals, said:

"This transaction is part of Sistema-Hals' current financial programme which is intended to restructure the company's debt portfolio by methods including reducing interest expenses and extending the average credit repayment period.  16 Russian and Western banks took part in the credit tender.  The proposal by VTB fully met our requirements and proved to be the most favourable from a commercial point of view. Lower interest expenses will provide the shareholders of Sistema-Hals with a greater return on their investment".