Krasnodar, September 14, 2004: Southern Telecommunications Company (UTK) (RTS: KUBN, KUBNP; OTC USA: STJSY)], the principal fixed-line telecommunications provider for Russia’s Southern Federal District, reports that under the terms of irrevocable offer the time for submitting series 01 bonds for the redemption expired on September 10, 2004. During the period set for offer submission (from 2 to 10 September 2004) no application of intention to sell UTK series 01 bonds was submitted that proved the attractiveness of the bond issue for investors and market players.

On 18 September 2003 placement of UTK series 01 non-convertible interest-bearing certificated pay-to-bearer bonds with mandatory centralized custody ( state registration number 4-05-00062-A ?f 15.08.2003, ISIN code RU0009071088) was successfully performed in the MICEX Stock market section. Volume of bond issue is RUR 1.5 billion, the term to maturity is 1,092 days (3 years) with half-year fixed coupon at 14.24% annual rate and offer for the redemption — 1 year from the date of placement at 100 % of the par value. Arrangers of the series 01 bond issue are Promyshlenno-stroitelniy bank and Renaissance Broker.