OREANDA-NEWS. Open Joint Stock Company “MegaFon” (LSE: MFON), a leading Russian telecommunications operator (“MegaFon” or the “Company”), announces signing of the Deed of Amendment (the “Deed”) to the Share Purchase Agreement for acquisition (the “Acquisition”) of a 100% interest in Maxiten Co Limited (“Maxiten”), which holds a 100% interest in Scartel (“Scartel/Yota”), from Garsdale Services Investment Limited (“Garsdale”), MegaFon's controlling shareholder. The Deed provides for prepayment of USD 1,060 million of its USD 1,180 million liability related to the Acquisition.

Pursuant to the decision taken at the Company's Extraordinary General Meeting of Shareholders on 05 June 2014, MegaFon has signed the Deed of Amendment that allows prepaying of c. 90% of the total consideration for the Acquisition, which represents the Company's largest US Dollar-denominated liability.

“The Company' excellent operational results and recent successful ruble bond issue resulted in a solid liquidity position. This led shareholders to make the decision to prepay c. 90% of the Scartel / Yota liability, thus eliminating a sizeable US dollar liability and further reducing our exposure to volatile FOREX markets. We are constantly monitoring opportunities at the debt and FOREX markets in order to manage the Company's cash position and hedge foreign exchange risks in an optimum way. We believe, that this transaction validates prudent approach of MegaFon to foreign exchange risk management while allowing for future cash savings due to decreased interest expense.”, CEO Ivan Tavrin commented.

MegaFon acquired 100% interest in Maxiten on 1 October 2013 (the “Closing Date”), and agreed to pay the consideration of USD 1,180 million to Garsdale in two equal installments on the first and second anniversaries of the Closing Date (1 October 2014 and 1 October 2015, respectively) plus interest at 6% p. a., accrued thereon from the Closing Date until it has been paid.

In line with the applicable legislation, the Company' shareholders affiliated with Garsdale and the Company's CEO abstained from voting.