MegaFon : places bonds at record low rate

The Bonds were offered under the exchange bonds program (4-00822-J-001P-02E) admitted to trading on 20 April 2016, as earlier announced on the Company's website: http://corp.megafon.com/investors/news/capital_market_releases/20160422-1553.html. The nominal value of a bond is RUB 1,000 and the placement price was 100% of the nominal value. The new bond issue has a term of 5 years with no embedded put options. The final coupon rate for the Bonds was determined via the book building and set at 7.85% per annum. Under the terms of the Bonds issue, the coupon will be paid semiannually. The proceeds from the Bonds issue will be used to finance the Company's general corporate purposes and refinance the Company's existing liabilities. Allocation of the Bonds to investors will occur on the Moscow Exchange on or about 9 October 2017.

BCS Global Markets, Gazprombank, Russian Agricultural Bank and UniCredit Bank were the lead arrangers, with Gazprombank acting as placement agent.

MegaFon CFO Gevork Vermishyan commented: '7.85% per annum is the lowest rate ever for MegaFon's public debt instruments and the lowest rate for the Russian corporate bond market since 2014. This deal is fully aligned with the company's strategy of managing its debt portfolio and liabilities efficiency.'

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Notes to Editors

MegaFon PJSC is a leading Russian integrated telecommunication service provider, operating in all segments of the telecommunications markets in Russia, and in the Republics of Abkhazia, South Ossetia and Tajikistan. MegaFon is a recognized market leader in the provision of mobile data services, was the first operator in Russia to launch commercial operation of a third generation (3G) network and was the first operator in the world to launch commercial operation of an LTE Advanced (4G) data network. MegaFon is traded on the Moscow Exchange and the London Stock Exchange under the symbol MFON. Additional information about MegaFon and the products and services provided by MegaFon can be found at http://www.megafon.ru.

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