Moscow, Russia – September 15, 2005 – Sistema (LSE: SSA), the largest private sector consumer services company in Russia and the CIS, announced today that its fixed-line telecommunications provider subsidiary Comstar UTS has acquired a 45% equity stake and a share of the debt of Metrocom, a leading alternative fixed-line telecommunications company in St.Petersburg, for a total cash consideration of $22.5 million including the refinancing of a loan previously obtained by Metrocom with the support of Antel Holdings Ltd. The stake has been acquired from Antel Holdings Ltd., a subsidiary of MENATEP Group. The remaining 55% of Metrocom is held by the St. Petersburg City Property Management Committee (KUGI).

By acquiring this stake in Metrocom, Comstar is able to pursue its regional expansion strategy and has the opportunity to participate in the operational control of a company controlling 14% of the telecommunications sector in the St. Petersburg region.

Metrocom provides fixed-line telecommunications services, internet access and data transmission. It owns more than 1,000 kilometres of fibre optic network and the client base consists mainly of large corporations, banks and state enterprises. Metrocom’s telephone cards business covers around 37% of the local market. Revenue amounted to $28 million in 2004.

“The acquisition of Metrocom provides Comstar with a firm start in the new market of the St. Petersburg region” – said Semen Rabovsky, General Director of Comstar UTS, and added: “Comstar’s expertise and technological know-how will further drive the development of Metrocom’s business and strengthen its competitive advantages such as the stable client base, high quality services and established name.”