Moscow, Russian Federation – Mobile TeleSystems OJSC (“MTS” – NYSE: MBT), the largest mobile phone operator in Russia and the CIS, announces that it has successfully renegotiated the terms of the EUR 300 million credit facility from Gazprombank as part of the Company’s efforts to reduce the interest rates of its debt portfolio.

MTS initially entered the credit agreement with Gazprombank in late December 2008. Under the terms of the agreement, the Company was to pay an annual interest rate of 12%. As the result of negotiations, the interest rate has been decreased to 8%. The maturity of the facility has been extended by more than a year from June 2011 to September 2012.  MTS has already paid down EUR 50 million of the original facility.

A significant portion of the credit facility in the amount of EUR 150 million has been restructured into Russian rubles  with maturity in September 2012 and an annual interest rate of 13%.

The Company also opened a revolving credit facility in the amount of EUR 100 million with maturity in September 2012 and an annual interest rate of 8%.

The amendment to the terms of the agreement is part of the MTS' ongoing effort to reduce its overall interest rate expense by taking advantage of improved credit market conditions.