OREANDA-NEWS. November 26, 2007. Southern Telecommunications Company (RTS: KUBN, KUBNP; MICEX: UTEL, UTELP; ADR OTC: STJSY, KUE FRA)], the principal fixed-line telecommunications provider for Russia’s Southern Federal District, on November 22 announced that Standard & Poors Rating Services raised its long-term corporate credit rating on Southern Telecommunications Company to B from B- with "Positive" outlook. At the same time, the Russia national scale rating was raised to ruA from ruBBB.

The rating upgrade was mainly attributable to generation of positive free operating cash flow due to decline in debt leverage, the Company’s limited capital expenditures, EBITDA increase as well as active development of value-added services and tight cost control.

According to Standard & Poors analysts, UTK’s dominant position in local and intra-zonal telephony segments and its established position as a regional incumbent operator in Russia’s telecoms industry moderate the Company’s main risks.

Detailed information on the credit rating revision can be viewed at http://www.standardandpoors.ru/