Moscow, Russia – February 24, 2011 – “COMSTAR – United TeleSystems” JSC (“Comstar”) (LSE: CMST), the largest integrated telecommunications provider in Moscow and 84 Russian cities, with a presence in Ukraine and Armenia, today announces that, following the announcement on 24 December 2010 that Comstar shareholders had approved the merger of Comstar into Mobile TeleSystems OJSC (“MTS”) pursuant to which Comstar will cease to exist as a separate legal entity, Comstar intends to cancel the listing of the global depositary receipts (“GDRs”) representing ordinary shares in Comstar from the Official List of the UK Listing Authority and cancel the admission of the GDRs to trading on the London Stock Exchange (the “GDR Delisting”).

The statutory merger of Comstar into MTS under Russian law is conditional upon certain statutory merger procedures that include filings with, and actions by, various government agencies.

The GDR Delisting is currently expected to take place on 25 March 2011 or shortly afterwards, but is subject to the completion of such statutory merger procedures. An update on timing will be provided prior to 25 March 2011 (the earliest possible date for the GDR Delisting).

In connection with the GDR Delisting, Comstar shall direct Deutsche Bank Trust Company Americas (the depositary for Comstar’s GDR programme) to terminate the depositary agreements relating to both the Regulation S GDRs and Rule 144A GDRs. A separate notification in this regard will be issued by Deutsche Bank Trust Company Americas to GDR holders.

In accordance with the terms of the merger, Comstar shareholders will receive 0.825 MTS ordinary shares for each Comstar ordinary share that they own. Subject to the procedures and conditions set forth in a Merger Notice to be sent out to the GDR Holders on or about 28 February 2011, and such correspondence as may be provided to GDR Holders in connection therewith, eligible GDR Holders may elect to receive MTS Shares. GDR holders who elect to receive cash or do not provide an election, certification, payment and delivery instructions within the timeframes prescribed in the Merger Notice or who are unable to provide the required certification will be entitled to a proportionate interest in the net proceeds from sale by Deutsche Bank Trust Company Americas of MTS Shares not distributed to Comstar GDR Holders. Such proceeds will be net of applicable fees, expenses and taxes, and subject to any adjustment for currency exchange rate fluctuations. 

Information regarding Comstar’s statutory merger into MTS, is available at https://www.comstar-uts.ru/en/for_investors/mts/merger_disclaimer/