AFK Sistema : Sistema to sell up to 0.92% of MTS shares in connection with tender offer

17/01/2017

Sistema to sell up to 0.92% of MTS shares in connection with tender offer

Moscow, Russia - January 17, 2017.Sistema PJSFC ('Sistema' or 'the Corporation') (LSE: SSA; MOEX: AFKS), a Russian public diversified holding company, announces that its subsidiary Sistema Finance S.A. has entered into a binding agreement to sell shares of PJSC MTS ('MTS') in connection with the tender offer to purchase MTS shares (the 'Tender Offer') being carried out by MTS subsidiary Stream Digital, LLC (the 'Buyer').

Under the agreement, Sistema Finance S.A. will sell up to 18,387,273 ordinary shares of MTS (up to 0.92% of the company's share capital) for a consideration of up to RUB 4,651,980,169. The exact number of shares for the transaction will be determined based on the number of shares sold by minority shareholders of MTS under the Tender Offer in proportion to Sistema's effective stake in MTS of as of 17 January 2017 (50.03%). The transaction will be executed at a price equal to the sale price at which minority shareholders participate in the Tender Offer. This transaction is dependent on the Buyer successfully implementing the Tender Offer.

As a result of the share sale by MTS and implementation of the Tender Offer, Sistema's effective stake in the share capital of MTS will remain unchanged.

Sistema President Mikhail Shamolin said: 'As a leading Russian telecommunications operator and one of the most profitable companies in the sector, MTS remains focused on delivering attractive shareholder returns and is consistently pursuing a policy of returning cash to investors. Participation in the share buyback gives Sistema the opportunity to strengthen its cash position and to receive additional investment resources while maintaining control in its strategically important asset.'

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

Sistema PJSFC is a publicly-traded diversified Russian holding company serving over 150 million customers in the sectors of telecommunications, high technology, banking, retail, timber processing, agriculture, real estate, pharmaceuticals, tourism and healthcare services. The company was founded in 1993. Its revenue in 2015 reached RUB 708.6bn; its total assets equalled RUB 1.3tn as of 31 December 2015. Sistema's global depositary receipts are listed under the symbol 'SSA' on the London Stock Exchange. Sistema's ordinary shares are listed under the 'AFKS' ticker on the Moscow Stock Exchange. Website: www.sistema.ru.

THIS ANNOUNCEMENT IS FOR GENERAL INFORMATION ONLY AND DOES NOT FORM PART OF ANY OFFER TO SELL, OR THE SOLICITATION OF ANY OFFER TO BUY, SECURITIES. THE DISTRIBUTION OF THIS ANNOUNCEMENT IN CERTAIN JURISDICTIONS MAY BE RESTRICTED BY LAW. ANY PERSONS READING THIS ANNOUNCEMENT SHOULD INFORM THEMSELVES OF AND OBSERVE ANY SUCH RESTRICTIONS. THIS ANNOUNCEMENT CANNOT BE USED AS A BASIS FOR ANY INVESTMENT AGREEMENT OR DECISION.