Mobile TeleSystems receives two credit facilities totaling $121M to finance expansion of its network in Russia

October 29, 2004

2 Min Read

MOSCOW, Russia -- Mobile TeleSystems OJSC (“MTS” — NYSE: MBT), the largest mobile phone operator in Russia and the CIS, announces that it has obtained two committed credit facilities in an aggregate amount of approximately $121 million to finance the further expansion of the Company’s network in Russia.

The funds will be used to purchase equipment and software from Siemens Aktiengesellschaft and Alcatel SEL AG for the technical upgrading and expansion of the Company’s network in Russia. The arrangers and lenders of the credit facility are HSBC Bank plc (London) and ING BHF-BANK Aktiengesellschaft. Euler Hermes Kreditversicherungs-AG, the German credit export agency, is providing export credit cover with respect to both facilities. The facilities have a tenor of approximately 9 years and the all-in cost of financing, including the export credit agency fees, equates to approximately 1.9% per annum over LIBOR for each facility.

Commenting on the new credit facility, Tatiana Evtushenkova, MTS’ Vice President for Investment and Corporate Development, said: “ECA-backed financing is one of the cheapest sources of funding available to us today. The repayment conditions are also favorable for us and convenient in terms of managing our cash-flow as we will be repaying the loan over a nine year period. The funds will be used exclusively to purchase equipment from two of the world’s leading manufacturers, Siemens and Alcatel.”

“It is not the first time that our Bank is working with MTS. We are pleased that our successful co-operation with MTS has been extended,” said Vadim Udalov, Member of the Management Board, Head of Corporate and Institutional Banking, ÎÎÎ HSBC Bank (RR), a wholly owned subsidiary of HSBC Bank plc (London).

“ING is proud of the strong relationship we have with MTS as demonstrated by this deal amongst others,” said Siobhan Walker, CIS Regional Head of Corporate Financial Services, ING Bank (Eurasia) ZAO.

Mobile TeleSystems OJSC (MTS)

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