Rostelecom buys additional shares in Svyazinvest

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Moscow, Russia – October 17, 2012 – Rostelecom OJSC (the “Group”) (MICEX - RTS: RTKM, RTKMP; OTCQX: ROSYY), Russia’s national telecommunications operator, announces that its Board of Directors has approved the acquisition of 140,315,416 additional ordinary nominal book-entry shares in Svyazinvest OJSC*(“Svyazinvest”).

The shares have been acquired as part of a private placement to existing Svyazinvest shareholders. Rostelecom will pay a total cash consideration of RUB 1,720.267 million for the shares. The acquisition will enable the Group to remain in control of the 25% + 1 share blocking stake it possesses in the state holding before the merger is complete.

In accordance with Russian Federation Presidential Decrees 1005 dated August 12, 2010, and 1418 dated November 15, 2010, the State, represented by the Federal Agency for State Property Management, is the second Svyazinvest shareholder and will purchase its stake by transferring to Svyazinvest its ordinary shares in OJSC Bashinformsvyaz, JSC Ingushelektrosvyaz, JSC Chukotkasvyazinform, OJSC MMTS-9, as well as its ordinary and Class A preferred shares in JSC Central Telegraph.

The second stage of the reorganisation, which merges Svyazinvest with Rostelecom, is expected to be completed in 2013. Once the merger is complete, Rostelecom will obtain control over all of Svyazinvest’s assets.

*The shares exchanged in this private placement were issued by Svyazinvest following an Extraordinary General Meeting of Svyazinvest shareholders on July 29, 2012, that approved an additional issue of 561,261,664 ordinary shares at par value of RUB 1 each. On October 11, 2012, the issue was registered with the Federal Service for Financial Markets (FSFM) and assigned under state registration number 1-03-00563-A-001D.