Comstar Board Sets Date of AGM and Recommends Dividend Payment

MOSCOW--(BUSINESS WIRE)--“COMSTAR – United TeleSystems” JSC (“Comstar” or “the Group”) (LSE: CMST.L), the largest integrated telecommunications provider in Moscow and 69 Russian cities, today announced that the Board of Directors (the “Board”) set the date for Comstar’s Annual General Meeting of Shareholders (“AGM”) for June 30, 2009.

The Board recommended an annual dividend of approximately RUR 90.3 million, or approximately US$ 2.9¹ million, for the twelve months ended December 31, 2008 to holders of Comstar shares as at the record date of May 22, 2009. The dividend represents approximately 2% of Comstar’s consolidated net income for 2008 under US GAAP. The dividend, which amounts to a payment of RUR 0.22 per ordinary share, or approximately US$ 0.007¹ per Global Depositary Receipt (“GDR”), is due to be paid within 60 days of the approval by the AGM.

In addition, the Board recommended the AGM to approve Comstar’s Annual Report 2008 and the annual financial statements for the financial year ended December 31, 2008, as well as distribution of Comstar’s profit and loss upon the results of the fiscal year.

The Board also recommended the AGM to elect new members to the Board of Directors and the Audit Committee of Comstar, approve an independent auditor for 2009, and approve the revised edition of the Charter.

The AGM will also consider amendments to the bylaws regarding the Annual Meeting of Shareholders, Management Board, President, Audit Committee and Compensation policy for the members of the Board.

Further information with regard to the AGM and other related issues will be available on the Company’s web site www.comstar-uts.ru.

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¹ Based on the Russian Central Bank exchange rate as at May 22, 2009.

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For further information, please visit www.comstar-uts.com

Comstar UTS is the leading fixed-line telecommunications company in Moscow. Comstar provides voice, data, television and other value-added services to residential and corporate subscribers and operators, using its extensive backbone network and exclusive last mile access to 97% of Moscow households. The Company also offers communications services in five Russian regions, Armenia and Ukraine. Comstar had 3.6 million residential subscribers and 784 thousand residential broadband internet subscribers in Moscow, as well as 73 thousand residential regional and international broadband internet subscribers at the end of December 2008. Comstar generated US$ 1,647.7 million of revenues and a 41.4% adjusted OIBDA margin for the twelve months ended December 31, 2008. Comstar’s Global Depositary Receipts are listed on the London Stock Exchange (ticker: CMST).

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 Comstar UTS. 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. Comstar UTS wishes to caution that these statements are only predictions, and that actual events or results may differ materially. Comstar UTS does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of Comstar UTS, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, rapid technological and market change in the industries Comstar UTS operates in, as well as many other risks specifically related to Comstar UTS and its operations.

Comstar UTS
Masha Eliseeva
Tel: +7 985 997 0852
ir@comstar-uts.ru
or
Shared Value Limited
Matthew Hooper
Tel. +44 (0) 20 7321 5010
comstar@sharedvalue.net