UK Regulatory Announcement



Moscow, Russia – December 18, 2013 – Sistema JSFC ("Sistema" or the “Group”)
(LSE: SSA), the largest publicly-traded diversified holding company in Russia
and the CIS today announces that the Group’s Board of Directors (“Board”) has
approved a restructuring plan for Sistema’s subsidiary - Sistema Invest CJSC^1
(“Sistema Invest”).

The reorganisation proposes the separation of Sistema Invest’s assets, with
20.2% of Bashneft’s (“Bashneft” or the “Company”) issued ordinary shares^2
being transferred from Sistema Invest to Bashneft Invest – a newly formed 100%
Bashneft owned subsidiary. Bashneft Invest will also receive Sistema Invest’s
payables due to Bashneft which amount to approximately RUB 36 billion.

Sistema Invest will retain 8.4% of Bashneft’s charter capital, 21.5% of
Ufaorgsintez’ charter capital and 90.5% of Bashkirian Power Grid Company’s
charter capital, and will become a 100% owned subsidiary of Sistema.

Following the reorganisation, Bashneft intends to cancel the ordinary shares
transferred to Bashneft Invest. This in turn is expected to result in Sistema
owning 70.5%^3 of Bashneft’s charter capital (prior to the results of
Bashneft's mandatory tender offer).

The completion of the reorganisation is subject to all necessary corporate
approvals from Bashneft and Sistema Invest.

Mikhail Shamolin, CEO and President commented:

“The elimination of the cross ownership structure is the last major milestone
towards simplifying Bashneft’s corporate structure. The announced plan
improves the dividend flow to all Bashneft shareholders, it rationalises the
Company’s assets and creates a far more effective structure for Sistema’s
petrochemical and power grid companies.

This substantial value crystalisation will benefit all shareholders and make
Bashneft one of the most transparent companies in Russia.”


For further information, please visit or contact:

Investor Relations                  Public Relations

Evgeniy Chuikov                     Ekaterina Tsukanova
Tel.: +7 (495) 692 1100             Tel.: +7 (495) 228 1536             

Sistema is the largest publicly-traded diversified holding company in Russia
and the CIS, which invests in and is a major shareholder of companies serving
over 100 million customers in the sectors of telecommunications, high
technology, oil and energy, radars and aerospace, banking, retail, mass-media,
tourism and healthcare services. Founded in 1993, the Company reported
revenues of US$ 9.3 billion for the third quarter of 2013, and total assets of
US$ 44.4billion as at September 30, 2013. Sistema's global depository receipts
are listed under the symbol "SSA" on the London Stock Exchange. Sistema's
ordinary shares are listed under the symbol "AFKS" on the MICEX-RTS Stock
Exchange. Sistema was ranked number 315 in the 2012 edition of the Fortune
Global 500 list. Website:

The Company is not an investment company, and is not and will not be
registered as such, under the U.S. Investment Company Act of 1940.

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 Sistema. 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. In addition, there is
no assurance that the new contracts entered into by our subsidiaries
referenced above will be completed on the terms contained therein or at all.
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. Many factors could cause the actual results to differ
materially from those contained in our projections or forward-looking
statements, including, among others, general economic conditions, our
competitive environment, risks associated with operating in Russia, rapid
technological and market change in our industries, as well as many other risks
specifically related to Sistema and its operations.

^1 Sistema owns 50.6% in the charter capital of Sistema Invest CJSC, Bashneft
owns 49.4% in the charter capital of Sistema Invest CJSC. Sistema Invest CJSC
prior to the proposed transaction owns 25.2% in the charter capital of
^2 38,139,925 ordinary shares of Bashneft which represents 20.2% of Bashnefts
ordinary issued share capital or 16.8% of charter capital
^3 Including ownership through 100% subsidiaries of Sistema – Sistema Invest
CJSC and Sistema Finance OJSC.


JSFC Sistema
Press spacebar to pause and continue. Press esc to stop.