Moscow, Russia – June 28, 2010 – “COMSTAR – United TeleSystems” JSC (“Comstar” or “the Company”) (LSE: CMST), the largest integrated telecommunications provider in Moscow and 82 Russian cities, announces the decisions taken at the Annual General Meeting of OJSC Moscow City Telephone Network (“MGTS”) shareholders, which was held on June 28, 2010.

The AGM approved the payment of a dividend of RUR 49.44 (or approximately US$ 1.59^[1]) per preferred share for the full year 2009, and that no dividend shall be paid to holders of MTGS’ ordinary shares for the full year 2009. The total dividend payment to be made to holders of preferred shares will therefore total RUR 789 million (or approximately US$ 25.40 million), which is equivalent to 10% of MGTS’ net income for the full year 2009 under Russian Accounting Standards (RAS).

The AGM also approved the 2009 Annual Report and the annual accounts including the income statement for the full year 2009, as well as the distribution of MGTS’s full year 2009 earnings.

The Meeting also elected the MGTS Board of Directors of MGTS, which comprises: 

- Mikhail Bedin – Director of the Department for Subscriber Access Network Operations, Comstar-UTS. Mr. Bedin was nominated by Comstar-UTS. 

- Alexey Goncharuk – First Vice President, Comstar-UTS. Mr. Goncharuk was nominated by Comstar-UTS.

- Dmitry Karmanov – Vice President for Human Resources Management, Comstar-UTS. Mr. Karmanov was nominated by Comstar-UTS.

- Oleg Mukovozov – Director of Corporate Governance, Comstar-UTS. Mr. Mukovozov was nominated by Comstar-UTS.

- Nikolai Naumovich – Vice President For Corporate Governance and Legal Matters, Comstar-UTS. Mr. Naumovich was nominated by Comstar-UTS.

- Vyacheslav Nikolayev – Director of Commercial Controlling of the Commercial department of the Corporate centre, Mobile TeleSystems (MTS). Mr. Nikolayev was nominated by Comstar-UTS

- Sergey Pridantsev – President and Chief Executive Officer of Comstar-UTS. Mr. Pridantsev was nominated by Comstar-UTS. Mr. Pridantsev was elected the Chairman of the Board of Directors.

- Alexander Provotorov – First Deputy General Director, Svyazinvest. Mr. Provotorov was nominated by Svyazinvest.

- Victor Savchenko – Deputy General Director, Svyazinvest. Mr. Savchenko was nominated by Svyazinvest.

- Victor Stankevich – Head of Procurement Compliance, MTS. Mr. Stankevich was nominated by Comstar-UTS.

- Maxim Chernov – Head of Marketing, Comstar-UTS. Mr. Chernov was nominated by Comstar-UTS.

- Evgeny Yurchenko – General Director, Svyazinvest. Mr. Yurchenko was nominated by Svyazinvest.

^[1]Bank of Russia’s US$-RUB exchange rate as at June 28, 2010