NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR ANY OTHER JURISDICTION IN WHICH OFFERS OR SALES WOULD BE PROHIBITED BY LAW

Moscow, Russia – 16 June 2020 – Sistema PJSFC (“Sistema” or the “Corporation”) (LSE: SSA; MOEX: AFKS), a publicly traded diversified Russian holding company, announces the launch, together with the Russia-China Investment Fund (“RCIF”), of an offering of approximately 118 million existing shares in Detsky Mir (the “Company” and the “Offering” respectively).

DETAILS OF THE OFFERING

·                                 Offering shares are being offered (i) outside the United States in reliance on Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and (ii) within the United States to certain qualified institutional buyers as defined in, and in reliance on, Rule 144A under the Securities Act.

·                                 The Offering will consist exclusively of existing Company’s shares held by Sistema directly and RCIF via its investment vehicles Floette Holdings Limited and Exarzo Holdings Limited (collectively, the “Selling Shareholders”).

·                                 The shares will be offered by way of an undocumented accelerated bookbuild, which will be launched immediately following this announcement, and may close at any time at short notice. The number of shares to be placed and the offering price will be determined at the close of the bookbuild process, and the results will be announced as soon as practicable thereafter.

Credit Suisse Securities (Europe) Limited, Goldman Sachs International, Sberbank CIB and VTB Capital plc are acting as Joint Global Coordinators and Joint Bookrunners (the “JGCs”), Alfa Bank is acting as Joint Bookrunner.

Prior to the completion of the Offering, Sistema has 33.38% ownership interest and RCIF has 7.56% ownership interest, respectively, in the Company. Pro-forma for the offering size of 118 million shares, Sistema will retain a stake of approximately 20.4%, and RCIF will retain a stake of approximately 4.6%, respectively, in the Company. The Offering is not expected to result in any near term changes to the Company’s governance, including the composition of the Company’s Board of Directors.

Shares in Detsky Mir held by Sistema and RCIF which are not sold in the Offering will be subject to a 90-day lock-up, subject to certain customary exceptions.

Net proceeds from the offering received by Sistema will be used for general corporate purposes, including potential debt reduction.

***

Sistema PJSFC is a Russian publicly-traded diversified holding company serving over 150 million customers in the sectors of telecommunications, high technology, banking, retail, timber processing, agriculture, real estate, tourism and healthcare services. The company was founded in 1993. Its revenue in 2019 reached RUB 656.9bn; its total assets equalled RUB 1.3tn as of 31 December 2019. Sistema's global depositary receipts are listed under the “SSA” ticker on the London Stock Exchange. Sistema’s ordinary shares are listed under the “AFKS” ticker on Moscow Exchange. Website: www.sistema.ru                                                                          

***

For further information, please visit www.sistema.com or contact: