ROSTELECOM SIGNS RUB 60 BILLION LOAN AGREEMENTS WITH SBERBANK OF RUSSIA WITH MATURITIES OF 3 AND 5 YEARS
Moscow, Russia – June 20, 2012 – Rostelecom OJSC (MICEX - RTS: RTKM, RTKMP; OTCQX: ROSYY), Russia’s national telecommunications operator, today announces that it has two loan agreements with Sberbank of Russia (“Sberbank”) totalling RUB 60 billion, which will mature in 3 and 5 years, respectively. Rostelecom will use the proceeds raised from the agreed loans to refinance its current liabilities, as well as to finance its operating activities and CAPEX programme.
Further to an open bidding process conducted by Rostelecom, and following the highest price bids submitted by Sberbank, the two companies entered into negotiations to sign the loan agreements.
Ilya Ponomarev, Executive Director - Director of Finance Department of Rostelecom, commented: “We are pleased with the results of the bidding process and to have further developed our cooperation with Sberbank, who offers attractive terms of financing as the leader in the Russian financial market. Rostelecom plans to use the loan proceeds to restructure its existing debt, which will help us prolong the payment terms of our liabilities and improve the balance of our debt portfolio.”
Alexey Grenkov, Head of key client coverage, Key Corporate Clients Department, added: “We are happy to start a new stage of our cooperation with Rostelecom, one of Russia’s largest telecommunications operators, and we plan to further develop our relationship as part of a strategic partnership.”
The Board of Directors of Rostelecom made a decision to raise the RUB 60 billion additional debt financing on June 13, 2012.
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For more information please visit www.rostelecom.ru or contact:
Investor Relations Department
Tel. +7 (499) 995 97 80
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Rostelecom (www.rostelecom.ru) is Russia’s national telecommunications operator and now also includes the regional incumbent telecommunications operators (CentreTelecom, SibirTelecom, Dalsvyaz, Uralsvyazinform, VolgaTelecom, North-West Telecom and Southern Telecommunications Company) and Dagsvyazinform. Rostelecom has the largest domestic backbone network (approximately 500 thousand km) and last mile connections to approximately 43 billion households in Russia. The Company holds licences to provide a wide range of telecommunications services (telephony, data, TV and value-added solutions) to residential, corporate and governmental subscribers and fourth party operators across all regions of the Russian Federation. The Rostelecom brand is one of Russia’s ten most trusted brands (source: Romir market research).
Rostelecom’s ordinary and preferred shares are traded on the MICEX-RTS (RTKM, RTKMP) stock exchange, and its depository receipts are traded over-the-counter in the United States on the OTCQX under the symbol ‘ROSYY’. Rostelecom is majority owned (53.2% of ordinary shares) by the Russian Government and has a free float of less than 40% of the outstanding ordinary shares and over 70% of the outstanding preferred shares. Rostelecom was assigned a ‘BBB-’ and ‘BB+’ international credit ratings by Fitch Ratings and Standard&Poor’s respectively, both with a ‘Stable’ outlook. Rostelecom had 28.5 billion local fixed-line voice subscribers, 12.5 billion mobile voice subscribers, 8.2 billion fixed-line broadband subscribers and 5.9 billion pay-TV subscribers at the end of 2011. The Group generated RUB 296.0 billion of consolidated revenues, RUB 117.7 billion of OIBDA (39.8% of revenues) and RUB 46.1 billion of net income for the twelve months ended December 31, 2011.
Sberbank is the largest bank of Russia that holds about 27% of the Russian banking assets and employs nearly 240,000 people. The Central Bank of Russian Federation is the founder and major shareholder of Sberbank, owning over 57.6% of its issued outstanding shares. Other shares are held by more than 245,000 individual and institutional investors. The Bank has one of the largest networks in Russia: 17 territorial banks, about 19,000 branches as well as subsidiaries in Kazakhstan, Ukraine and Belarus, a branch in India, representative offices in Germany and China. With the acquisition of Volksbank International in 2012 Sberbank gained presence in nine Central and Eastern European countries.
The bank holds the general banking license No.1481 issued by the Bank of Russia.
The official website is www.sberbank.ru
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Certain statements in this press release are forward-looking statements within the meaning of the U.S. federal securities laws and are intended to be covered by the safe harbors created thereby.
Those forward-looking statements include, but are not limited to:
• Management’s assessment of the Company’s future operating and financial results as well as forecasts of the present value of future cash flows and related factors;
• the Company’s anticipated capital expenditures and plans to construct and modernize its network;
• the Company’s expectations as to the growth in demand for its services, plans relating to the expansion of the range of its services and their pricing;
• the Company’s plans with respect to improving its corporate governance practices;
• the Company’s expectations as to its position in the telecommunications market and the development of the market segments within which the Company operates;
• economic outlook and industry trends;
• the Company’s expectations as to the regulation of the Russian telecommunications industry and assessment of impact of regulatory initiatives on the Company’s activity;
• other statements regarding matters that are not historical facts.
Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include:
• risks relating to changes in political, economic and social conditions in Russia as well as changes in global economic conditions;
• risks relating to Russian legislation, regulation and taxation, including laws, regulations, decrees and decisions governing the Russian telecommunications industry, securities industry as well as currency and exchange controls relating to Russian entities and their official interpretation by regulatory bodies;
• risks relating to the Company, including the achievement of the anticipated results, levels of profitability and growth, ability to create and meet demand for the Company’s services including their promotions, and the ability of the Company to remain competitive in a liberalized telecommunications market;
• technological risks associated with the functioning and development of the telecommunications infrastructure, technological innovations as well as the convergence of technologies;
• other risks and uncertainties. For a more detailed discussion of these and other factors, see the Company’s Annual Report and the Company’s other public filings.
Many of these factors are beyond the Company’s ability to control or predict. Given these and other uncertainties, readers are cautioned not to place undue reliance on any of the forward-looking statements contained herein or otherwise. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements (which are made as of the date hereof) to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required under applicable laws.