Moscow, Russian Federation – MTS PJSC (“MTS” – NYSE: MBT; MOEX: MTSS), the leading telecommunications provider in Russia and the CIS, announces the aquisition of a 30% stake in the authorized share capital of Sistema Capital Management Company, LLC (Sistema Capital), one of the largest management companies in Russia in terms of collective investment volume, for RUB 356 mln. Concurrently, Sistema PJSFC, a publicly traded diversified Russian holding company and the largest shareholder of MTS, will contribute roughly RUB 513 mln to the authorized capital of Sistema Capital, thus, reducing its stake to 70%.

A s a result of the deal, the book value of Sistema Capital net assets will increase up to RUB 1 bln at the end of the third quarter of 2017.

Under the terms of transaction, MTS has gained a blocking stake of ownership, while actually holding 30% of the authorized capital in Sistema Capital.
Such cooperation will allow MTS to enrich its existing portfolio with contemporary investment products, as well as create an oppurtunity to draw assets from a wide range of investors to participate in equity and debt capital markets and manage its own funds and securities in a more efficient way. Moreover, the increase in the authorized share capital of Sistema Capital will raise its business attractiveness while managing funds of various investors such as institutions, non-state pension funds, mutual funds, insurance companies and private individuals.

Alexey Kornya, MTS Vice President, Finance, Investments and M&A, commented:
“Thanks to the strategic cooperation of MTS and MTS bank today there are more than 35 million people using MTS financial services.
Collaboration with Sistema Capital will boost the number of FinTech users among MTS subscribers and allow MTS to provide brand-new online investment products accessible from mobile devices with a yield exceeding bank deposit rates. In our turn, we will bring to the joint business our competence in assets and liabilities management. The strategic objective of the deal is to develop on investment management company of high quality focused on attracting private and institutional funds and on effective liquidity management of MTS Group.”

Earlier MTS received all neccessary regulatory and corporate approvals for the deal.

Sistema Capital is licensed to manage securities and assets of investment funds, unit investment funds and non-state pension funds. In 2016 the overall portfolio of Sistema Capital amounted to more than RUB 25 bln. According to Investfunds, Sistema Capital is the sixth largest company in Russia in terms of collective investments volume. As reported by the rating agency RAEX, the company is rated A+ “Highly reliable”. For more information please visit the website https://www.sistema-capital.com/.

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For further information, please contact in Moscow:

Joshua B. Tulgan
Director, Department of Corporate Finance and Investor Relations
Mobile TeleSystems PJSC
Tel: +7 495 223 2025
E-mail: ir@mts.ru