Nizhny Novgorod, February 2005: On February 9, 2005 OJSC “VolgaTelecom” left off its participation in the last of its affiliate cellular companies of NMT-450 standard – CJSC “Cellular communication of Mordoviya” by selling 30 000 ordinary shares, making up 60% of the authorized capital, to the other shareholder of the company – to LLC “MC-Direct”.

This transaction occurred in accordance with the resolution of OJSC “VolgaTelecom” Board of directors passed on May 12, 2004 to leave off the Volga region carrier’s participation in the authorized capitals of the companies providing services of NMT-450 standard by selling the shares. 

Earlier OJSC “VolgaTelecom” had sold its assets of 4 cellular operators of NMT-450 standard: LLC “Udmurtiya’s cellular networks-450” (100%), LLC “Vyatskaya cellular communication” (51%), CJSC “Sotel – Nizhny Novgorod” (20%) and CJSC “Saratov’s system of cellular communication” (15%). In accordance with the Articles of Association of the operators, when the shares and equity stake are sold, other shareholders and equity stake holders have preemptive right. Thus, LLC “MC-direct” being a shareholder of these companies and who offered the most favorable price, enjoyed the preemptive right to buy the equity stake that belonged to OJSC “VolgaTelecom”. 

On February 3 LLC “MC-Direct” received the approval of Russia’s Federal Antimonopoly Service for the purchase of CJSC “Cellular communication of Mordoviya” shares. So on February 9, 2005 the last part of the transaction of the Volga region carrier with LLC “MC-Direct” of purchase and sale of 5 affiliate companies of cellular communication of NMT-450 standard was completed. The total amount of the transaction was US$7 million and 200 thousand.

____________

OJSC “VolgaTelecom” is a part of “Svyazinvest” holding and is one of the biggest interregional carriers in Russia. In the framework of electric communication industry restructuring, carried out by the holding, on November 30, 2002 11 regional electric communication enterprises of the Volga Federal District were consolidated into OJSC “VolgaTelecom”.