OREANDA-NEWS. On July 20, 2009 Southern Telecommunications Company (“UTK”) (RTS: KUBN, KUBNP; MICEX: UTEL, UTELP; ADR OTC: STJSY, KUE FRA)], the principal fixed-line telecommunications provider for Russia’s Southern Federal District, reported that Moody’s Investors Service Rating Agency affirmed its “B1” corporate family rating assigned earlier to Southern Telecommunications Company. The outlook of the rating is stable, reported the press-centre of UTK.

The rating action reflects Moody's expectation that the Company will show commitment to the prudent debt management strategy and gradually align its capital structure with the long-term investment needs. UTK's strategy envisages capitalisation on its current competitive advantage and maintaining its market share in local telephony, slightly increasing the share in intra-zonal telephony, and strengthening leadership in the Internet access and broadband.

“The Company's business model for sustainability and competitiveness in the coming years will to a large extent depend on its technological advancement through timely investment into the infrastructure” – the rating agency notes.
 
Deputy Director General – Director for Economics and Finance of Southern Telecommunications Company Vyacheslav Kozelsky commented: “Realizing the importance of “right” investments, the Company has reviewed its investment program. Now we are implementing only higher-yielding projects which payback periods do not exceed 2-3 years. UTK focuses on quick penetration into the broadband market, active work with corporate segment and telephone installations in newly-erected buildings. The Company’s main goal here is to increase its cash flow as much as possible in order to reduce the debt “