OREANDA-NEWS. Rostelecom OJSC (the “Company”) (MICEX - RTS: RTKM, RTKMP; OTCQX: ROSYY), Russia's national telecommunications operator, today announces that the Russian Direct Investment Fund and Deutsche Bank, one of the world's leading international banks,are jointly investing in Rostelecom. The investments total RUB 7.7billion and will be directed towards both the Company's future development and to strengthening its market position. The deal has received all the necessary approvals from Rostelecom, the Russian Direct Investment Fund and Deutsche Bank.

As a result of the deal, the investors will acquire 72,187,366ordinary Rostelecom shares from its subsidiary LLC MOBITEL. Thestructure of the deal will also involveRostelecom signingcall and put options to entitle the Company toa portion of an increase in share value if the share price rises, and investors willbe protectedif the share price falls. In addition, the option contracts do not infer the delivery of shares if the option is exercised.

Sergey Kalugin, President of Rostelecom, commented:“We are delighted that investors as prestigious and well-established as the Russian Direct Investment Fund and Deutsche Bank share our belief in Rostelecom's potential for growth. Attracting long-term partners is a vital part of implementing Rostelecom'sambitious plans and the deal serves as a positive signal for other top tier investors who may also look to participate in our growth prospects.

“The sale of our treasury shares helpstoimprove Rostelecom's investor base, and theproceeds generated will be used to reduce the Company's leverage, and further strengthen our market position. We have also ensured that Rostelecom will continue to benefit from any additional upside as the disposed treasury shares appreciate in value.”

Kirill Dmitriev, General Director of the Russian Direct Investment Fund, added: “Against the backdrop of growth in the Russian economy, demand for reliable networks and ultrafast broadband infrastructure from individual customers and businesses will increase. Now is therefore the time to invest in the telecommunications sector, andrecent reforms to Rostelecom'scorporate governance practices and its development leavethe Company perfectly positioned to capture the growth in the sector, particularly as Russia looks to reach infrastructure capacity.”