Krasnodar, 18 January 2006:Southern Telecommunications Company (“UTK”) [(RTS: KUBN, KUBNP; OTC USA: STJSY), the principal fixed-line telecommunications provider for Russia’s Southern Federal District, reports that on January 12, 2006  Federal Financial Markets Service of Russia registered the Report on the results of the issue of 04-series non-convertible interest-bearing  documentary pay-to-bearer bonds of Public Joint –Stock Company "Southern Telecommunications Company". The state registration number of 04-series bond issue is 4-08-00062-A dated 24 November 2005. The bond issue was placed by public subscription in the MICEX Stock Section on the 14-15th of December 2005. Pursuant to the Report on the results of the bond issue filed to FFMS of Russia, 5,000,000 (five million) bonds with the face value of 1,000 (one thousand) rubles each have been placed by the Issuer.

Information about the bond issue:

The Bond issue is for a total of RUR 5 bln, face value of each bond of the issue is RUR 1,000. The Bond issue provides for 16 coupon periods of 91 days each. The first coupon interest rate has been set at 10.50% per annum during the competition held  on the starting day of the bond placement which corresponds to the effective yield of 10.6%.  The interest rates on the second, third and  fourth coupons are equal to the first coupon interest rate. The interest rate on the coupons from 5th to 16th is fixed by the Issuer at 10.0% per annum. The coupon yield is accrued on the unredeemed part of a bond’s nominal value.

Under the terms of the Decision of the bond issue, it is assumed that the face value of each 04-series bond will be redeemed consistently by installments within the following deadlines: on the fourth coupon payment date each bond is to be redeemed partly at 10% of its face value; on the sixth coupon payment date each bond is to be redeemed partly at 15% of its face value; on the eighth coupon payment date each bond is to be redeemed partly at 10% of its face value; on the tenth coupon payment date each bond is to be redeemed partly at 15% of its face value; on the fourteenth coupon payment date each bond is to be redeemed partly at 25% of its face value;  on the sixteenth coupon payment date each bond is to be redeemed at the remaining 25% of its face value.

CJSC “AVK Investment Company” acts as the Financial Consultant of 04-series bond issue. NP «NDC» acts as the Payment Agent and Depositary providing for the centralized custody of the Bond issue. Underwriter of the issue is LLC “UTK-Finance”.

Additional information on UTK 04-series bond issue (Decision on the Bond Issue, Offering Circular, Informational Memorandum) can be viewed here.