Moscow and New York (April 14, 2005) - Open Joint Stock Company "Vimpel-Communications" and VimpelCom Finance B.V. ("VimpelCom" or the "Company") (NYSE: VIP) announced that in accordance with its previously disclosed plans to sell 50%-1 (minus one) share in Limnotex, the parent company of KaR-Tel, to a partner with local knowledge, it has entered into a purchase and sale agreement with Crowell Investments Limited, a Cypriot company beneficially owned and controlled by certain shareholders of ATF Bank. ATF Bank is the fourth largest bank in Kazakhstan.
The purchase price for the stake is US$175 million. The closing of the sale is subject to certain conditions and is expected to occur during the second quarter of 2005. VimpelCom and Crowell have also entered into a shareholders agreement that, among other things, grants call options to VimpelCom to reacquire up to the entire stake from Crowell under certain circumstances, thus allowing VimpelCom to own up to 100% of KaR-Tel's parent company. The exercise prices for the call options are based upon a prescribed formula.
Alexander Izosimov, Chief Executive Officer of VimpelCom said, "We are very pleased to have reached this agreement with our new partner, whose support and local knowledge will add great value. Together with our partner, we believe we are well positioned to become the number one operator in Kazakhstan."
VimpelCom is a leading provider of telecommunications services in Russia and Kazakhstan, operating under the "Beeline" brand in Russia and "K-mobile" and "EXCESS" brands in Kazakhstan. The VimpelCom Group's license portfolio covers approximately 94% of Russia's population (136 million people), including the City of Moscow, the Moscow Region and the City of St. Petersburg, as well as the entire territory of Kazakhstan. VimpelCom was the first Russian company to list its shares on the New York Stock Exchange ("NYSE"). VimpelCom's ADSs are listed on the NYSE under the symbol "VIP".
This press release contains "forward-looking statements", as the phrase is defined in Section 27A of the Securities Act and Section 21E of the Exchange Act. The forward-looking statements contained in this press release, including the anticipated closing of the transaction and the intended benefits to VimpelCom from the transaction described herein, are based on Management's best assessment. These discussions involve risks and uncertainties. The actual outcome may differ materially from these statements as a result of unforeseen developments from competition, governmental regulations in Kazakstan, general political uncertainties and general economic developments in Kazakhstan, and other factors. Certain additional factors that could cause actual results to differ materially from those discussed in any forward-looking statements include the risks described in the Company's Annual Report on Form 20-F for the year ended December 31, 2003 and other public filings made by the Company with the United States Securities and Exchange Commission, which risk factors are incorporated herein by reference. VimpelCom disclaims any obligation to update developments of these risk factors or to announce publicly any revision to any of the forward-looking statements contained in this press release, or to make corrections to reflect future events or developments.
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