Moscow, Russian Federation — August 12, 2003 — Mobile TeleSystems OJSC (“MTS” — NYSE: MBT), the largest mobile phone in Russia in terms of subscribers, today announced a series of related transactions that will give it a substantial equity interest in five regional mobile phone companies.

MTS has reached an agreement with MCT Corp, a Delaware corporation, and certain of its subsidiaries to acquire, in a series of related transactions:

• a 43.7% stake in a Uraltel, the largest cellular operators in the Sverdlovsk region of Russia;
• a 50% stake in Primtelefon, which holds a GSM license for the entire Far East region of Russia and certain parts of Siberia;
• a 50% stake in Volgograd Mobile, a cellular operator in the Volgograd region;
• a 50% stake in Astrakhan Mobile, a cellular operator in the Astrakhan region, and
• an 80% stake in a Mar Mobile, GSM-license holder in the Mari El Republic.

MTS previously had no ownership in those companies, except for Uraltel. The total purchase price for these stakes is approximately $70 million. The total net debt of all the companies in which stakes will be acquired is approximately $25 million.

The remaining 20% of Mar Mobile and another 2.95% of Uraltel will be acquired from existing shareholders unrelated to MCT Corp for approximately $1 million.

Uraltel is the leading operator in the Sverdlovsk region of the Urals. MTS already holds a 53.2% stake through its 100%-owned subsidiary, Telecom-900. Uraltel provided services to approximately 244,000 subscribers as of June 30, 2003. If the above transactions are completed MTS will be able to consolidate a 99.85% stake in Uraltel. Average monthly revenue per user (ARPU) for the first six months of 2003 was $20.

Primtelefon holds a GSM 900/1800 license for the entire Far East region and certain regions in Siberia with the total population of approximately 11.4 million¹ covered by the license. The network is already operational in the Primorsky and Sakhalin regions and the company is rolling out in Amur, Khabarovsk and Irkutsk regions. Primtelefon also holds an NMT 450 license for the Primorye region. The subscriber base as of June 30, 2003 was around 74,000 (69,000 on GSM networks and 5,000 on NMT networks), ARPU for the first six months of 2003 was $36.

Volgograd Mobile holds a GSM 1800 licence for the Volgograd region of Russia. The region?s population is 2.7 million and the company’s subscriber base as of June 30, 2003 was around 4,600. ARPU for the first six months of 2003 was $14.

Astrakhan Mobile holds a GSM 1800 license for the Astrakhan region (Volga part of Russia) with a population of 1 million. The company’s subscriber base as of June 30, 2003 was around 7,100. ARPU for the first six months of 2003 was $12.

Mar Mobile is a GSM 1800 license-holder for the Republic of Mary El in the Volga part of Russia, with a population of 730 thousand. The company is not yet operational.

Commenting on the transaction, MTS President Mikhail Smirnov said: “The transaction is in line with the Company’s strategy to grow the license footprint through acquisitions of local mobile operators as well as to consolidate minority stakes in our subsidiaries. The acquisitions fill important gaps in our license portfolio.”

Overall, the acquisitions will increase the population covered by MTS licenses by 12.9 million. If transactions are completed MTS will hold licenses for 75 regions of Russia (out of 89) and its Russian licenses will cover a population of 127.3 million (88% of total). Including operations in Ukraine and Belarus MTS? license portfolio will cover a population of 186.3 million². Completion of the transactions is subject to a number of conditions. No assurance can be given that the transactions will be completed on the terms and conditions described, or at all.

¹ Regions of Russian under the licence are: Sakha (Yakutia), Khabarovsk, Primorye, Amur, Magadan, Sakhalin, Irkutsk, Chita regions, Evreysky, Chukotka, Kamchatka, Ust-Ordynsky, Buryatsky, Aginsky-Buryatsky, and Koryaksky autonomous regions as well as the Republic of Buryatiya.

² Assuming that MTS completes an earlier-announced transaction to acquire a 100% of Sibchallenge, a GSM operator in the Kranoyarsk region.

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Mobile TeleSystems OJSC (or “MTS”) is the largest mobile phone operator in Russia and Eastern Europe in terms of the number of subscribers. Together with its subsidiaries, the Company services over 12.8 million subscribers. MTS and its subsidiaries are licensed to provide GSM services in 61 regions of Russia, in the Ukraine and in Belarus, which together have a total population of approximately 172.7 million. Since June 2000, MTS’ shares have been listed on the New York Stock Exchange with the ticker symbol MBT. Additional information about MTS can be found on MTS’ website at www.mtsgsm.com.

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Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of MTS, as defined in the safe harbor provisions of the U. S. Private Securities Litigation Reform Act of 1995. You can identify forward looking statements by terms such as “expect,” “believe,” “anticipate,” “estimate,” “intend,” “will,” “could,” “may” or “might” the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. We refer you to the documents MTS files from time to time with the U. S. Securities and Exchange Commission, specifically, the Company’s most recent Form 20-F, as amended. These documents contain and identify important factors, including those contained in the section captioned “Risk Factors,” that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, potential fluctuations in quarterly results, our competitive environment, dependence on new service development and tariff structures; rapid technological and market change, acquisition strategy, risks associated with telecommunications infrastructure, risks associated with operating in Russia, volatility of stock price, financial risk management, and future growth subject to risks.

For further information contact:

Mobile TeleSystems, Moscow
Andrey Braginski, Investor and Public Relations
tel: +7 (095) 911-65-53e-mail: ir@mts.ru

Gavin Anderson & Company, London
Halldor Larusson
tel: +44 (0) 20 7554 1400