Moscow, Russian Federation — Mobile TeleSystems OJSC („MTS“ — NYSE: MBT), the largest mobile phone operator in Russia and the CIS, enters into a management agreement with the majority shareholder of the Svyaznoy group of companies, Mr. Maxim Nogotkov, that assigns a team of top managers from Svyaznoy to supervise MTS’ retail network.

The three-year agreement provides for the transfer of Svyaznoy’s management expertise in running mobile retail networks, including business practices, IT solutions and other skills critical for the effective development of the MTS retail network.

RTK CJSC, a company wholly owned by MTS, will be charged with managing MTS retail network. Mr. Sergey Rumyantsev, the former executive vice-president of Svyaznoy, will serve as RTK CJSC general director. He will be joined by 13 top managers from Svyaznoy.

The management team of RTK CJSC will be responsible for the development of the MTS retail network, including the recently acquired Telefon.Ru retail chain.

„We are in the process of gradually optimizing our distribution channels to insure future growth of the Company. The development of our own retail network is critical and will allow MTS to better serve its clients, expand product offerings and strengthen brand loyalty,“ noted Mr. Aleksander Popovskiy, the Head of MTS Russia. „The skills of Mr. Maxim Nogotkov’s team and access to the expertise of one of the most efficient mobile retailers in Russia will foster optimal development of the MTS retail network and enhance its effectiveness and competitiveness.“