Moscow, Russia - March 27, 2006 - Comstar United TeleSystems (Comstar UTS) today announced the terms of its second public share purchase offer to Moscow City Telephone Network (MGTS) shareholders, as approved by the Board of Directors of Comstar UTS on March 22, 2006 and valid with effect from today. This public offer is only made to holders of MGTS common shares.

As previously announced, Comstar UTS acquired 4.21% of the outstanding MGTS common shares by means of the first mandatory offer, which was completed in February 2006, and a further 3.82% of the outstanding MGTS common shares on March 3, 2006. As a result of these transactions, Comstar UTS now owns 63.65% of the outstanding MGTS common shares.

Comstar UTS has now acquired more than 5% of the outstanding MGTS common shares in addition to what was owned prior to the first mandatory offer. Comstar UTS is therefore required under Article 80 of the Russian Federal Law on Joint Stock Companies to make an offer to the remaining MGTS common shareholders. The Board of Directors of Comstar UTS has approved an offer of RUR 490 (which is equivalent to approximately US$ 17,59)* per MGTS common share. The offer price is based on the weighted average market price of MGTS common shares over the six month period prior to the acquisition of MGTS common shares by Comstar UTS, which led to Comstar UTS exceeding the 5% threshold.  The offer price has been calculated by an independent appraiser.

MGTS common shareholders may accept this offer within 30 days of the receipt of official notification. Comstar UTS neither encourages nor discourages MGTS shareholders to accept this offer and does not provide any recommendation in this respect.

Comstar UTS has established a shareholder information line (+7 495 225-2261) in order to provide information to MGTS shareholders regarding the share purchase offer and what actions should be taken if shareholders decide to accept the offer.

* All payments for tendered common shares will be made in Russian rubles only and the US dollar equivalent is provided solely for information purposes. The exchange rate used to calculate the US dollar equivalent is sourced from the Central Bank of the Russian Federation and quoted as at March 27, 2006.