Moscow, Russian Federation – Mobile TeleSystems OJSC (“MTS” – NYSE: MBT), the leading telecommunications provider in Russia and the CIS, announces that it has increased its direct ownership in TS-Retail OJSC (TS-Retail), a subsidiary of AFK Sistema, from 25% to 40% for a nominal sum. Effective control in the company increased to 55% through Comstar-UTS’ ownership in TS-Retail.

The transaction is aimed at optimizing the management structure of the Company's retail business. TS-Retail had over 300 retail stores at the end of 2008. During 2009, MTS assumed operational control over the stores as part of its retail development strategy.