OREANDA-NEWS. May 25, 2009. Astana-Finance (Astana), a company listed on Kazakhstan Stock Exchange (KASE), provided KASE with a press release, reported the press-centre of KASE:

As financial standings of Astana-Finance (hereafter - Astana-Finance of the Company) deteriorated, and ratings of Astana-Finance and Astana-Finance B.V. were downgraded, the companies announced on decision to suspend beginning May 15, 2009 payment of interest and principal on its international debt, and payment of principal on several local obligations of Astana-Finance. The suspension covers certain obligations, which became subject to payment recently as ratings had been downgraded.

Company's financial standings deteriorated as Kazakhstan economy was affected by the global financial downturn. Different consequences, including the tenge devaluation, fall of prices on real state, lack of liquidity and further aggravation of financial standings of Kazakh corporations and financial organizations, lead to partial degradation of the Company loan portfolio and caused losses related to exchange rate and derivative transactions. Payment suspension will grant equal rights to all creditors, give the Company time to assess the situation and present the plan for restructuring, which will be just for investors and ensure continuous financial recovery of the Company. It is expected proposals on restructuring will cover international and domestic debt.

Astana-Finance is intending to continue operation and comply with certain obligations, which are necessary for this target.

For more accurate evaluation of consequences of the recent deterioration, the Company will request auditors to prepare a report on financial audit for the three initial months of 2009. Results of audited consolidated statements for the entire 2008 will be released in the nearest time.

The company is expecting financial and legal audit to take up to twelve months from the date of release of this statement. Audit results will form the basis for proposals on restructuring, which will be presented to the authorized body, creditors and investors. For aid in development of offers on restructuring, Astana- Finance engaged J.P. Morgan Securities Ltd., restructuring advisor, Clifford Chance LLP, international legal advisor and First Legal as Kazakhstan legal advisor.

The authorized body, Agency of the Republic of Kazakhstan on Regulation and Supervision of Financial Market and Financial Organizations, is fully aware of the Astana-Finance situation and it is expected that the Company will be provided with a reasonable period for preparation and presentation of offer on restructuring.

Moreover, Astana-Finance continues its talks with National Wellbeing Fund Samruk-Kazyna regarding valuation of possibility to render financial aid to the Company and coordination of further steps to improve financial standings of the Company.

Creditors, willing to receive further information, please, contact:

Mr. Daurzhan Augambay
tel: +7 7172 591082
Email: d_augambay@af.kz

Ms Zhanara Iskhakova
tel: +7 727 311 06 41 (ext. 108)
Email: zh_iskhakova@firstlegal.kz