AFK Sistema : Sistema to retain stake in MTS after share buyback

02/07/2018

Sistema to retain stake in MTS after share buyback

Moscow, Russia- 02 July 2018 - Sistema PJSFC ('Sistema' or the 'Company', together with its subsidiaries, 'the Group') (LSE: SSA, MOEX: AFKS), a publicly-traded diversified holding company, today announces, announces that its subsidiary Sistema Finance S.A. has signed a sale and purchase agreement for shares in PJSC MTS ('MTS') as part of the new buyback programme for MTS shares in the amount up to RUB 30.0 bn approved by the Board of Directors of MTS in June 2018 (the 'Programme').

During the Programme, which was launched on 02 July 2018 and will be effective during two years, MTS's subsidiary LLC Bastion (the 'Purchaser') plans to acquire shares and American depositary shares of MTS (collectively, the 'Shares') in the open market. Under the agreement, Sistema Finance may sell to the Purchaser ordinary shares of MTS in the amount calculated based on the number of Shares to be purchased by the Purchaser in the open market in proportion to Sistema Group's effective equity stake in MTS (50.0048% as of 02 July 2018).

Sistema Group's effective stake in MTS will therefore not change materially as a result of the Programme and Sistema Group will retain effective control over MTS. The Purchaser will purchase ordinary shares from Sistema Finance based on the weighted average price of Shares at which the Purchaser purchased them in the open market for each calendar month*.

*Taking into account the discount of the market value of MTS ordinary shares to American depositary shares.

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

Sistema PJSFC is a publicly-traded diversified Russian holding company serving over 150 million customers in the sectors of telecommunications, children's goods retail, paper and packaging, healthcare services, agriculture, high technology, banking, real estate, pharmaceuticals and hospitality. The company was founded in 1993. Its revenue in 2017 was RUB 704.6 bn; its total assets equalled RUB 1.1 trn as of 31 December 2017. 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.com.

The Company is not an investment company, and is not and will not be registered as such, under the U.S. Investment Company Act of 1940.

Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of Sistema. You can identify forward looking statements by terms such as 'expect,' 'believe,' 'anticipate,' 'estimate,' 'intend,' 'will,' 'could,' 'may' or 'might' the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. In addition, there is no assurance that the new contracts entered into by our subsidiaries referenced above will be completed on the terms contained therein or at all. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to Sistema and its operations.