Moscow, Russia - December 29, 2005 - Sistema (LSE: SSA), the largest private sector consumer services company in Russia and the CIS, announced today the merger of Sistema Multimedia, its digital content production and aggregation business, and MTU-Intel, the ISP arm of Comstar UTS. Comstar UTS now owns 51.82% of the merged entity, Sistema Mass Media owns 48.135% and Sistema Inventure owns the remaining 0.045%.

Post-merger, the business will continue to operate under the name of MTU-Intel. The merger will allow the company to better integrate its ADSL data and content offerings under Stream and Stream TV brands, thus enabling Comstar UTS to continue pioneering the triple-play concept in the Russian market.