Moscow, Russia - January 20, 2005 - JSC "COMSTAR - United TeleSystems" ("Comstar UTS"), the fixed-line telecommunications subsidiary of Sistema (LSE: SSA), today announced the results to date of its public share purchase offer to holders of common shares in Moscow City Telephone Network (MGTS), which was announced on December 14, 2005.  Comstar UTS has now acquired a further 3,053,671 MGTS common shares, which represent 3.83% of the MGTS common share capital. An additional 0.38% of the MGTS common share capital has been tendered but not yet settled and paid for.  Comstar UTS has therefore now increased its interest in the MGTS total share capital from 46.35% to 49.54%, and its interest in the MGTS common share capital from 55.62% to 59.45%. 

The 3,053,671 MGTS common shares were acquired for RUR 1,496,298,790 (US$ 52,889,755 as at January 20, 2006) in total, or RUR 490 (US$ 17.32 as at January 20, 2006) per share, which was based on the weighted average market price of MGTS common shares for the six months prior to the acquisition of the stake in MGTS by Comstar UTS, as calculated by an independent appraiser.  Holders of MGTS common shares may accept the share purchase offer within 30 days of receipt of the official notification.