HomePressPress ReleasesSistema announces proposed acquisition of Argos Group Holding B.V.

31/10/2012

Sistema announces proposed acquisition of Argos Group Holding B.V.

Moscow, Russia- October 31, 2012 - Sistema JSFC ("Sistema" or the "Company") (LSE: SSA), the largest publicly-traded diversified holding company in Russia and the CIS, today announces that it has signed a non-binding term sheet regarding the acquisition of 100% of the issued and outstanding shares in the share capital of Argos Group Holding B.V. ("Argos" and together with its subsidiaries and participations, the "Argos Group"), the largest independent group in the Western European downstream oil market, combining storage and distribution with the international trade in and sale of mineral oils and biofuels.

The contemplated transaction is subject to (i) completion of due diligence and the execution of legally binding transaction documents, (ii) corporate approval by Sistema, and (iii) clearance from the European Commission pursuant to Council Regulation (EC) No. 139/2004 as well as the possible clearance from competition authorities in other countries in which Sistema is active.

Sistema and Argos envisage working closely together to prepare the notifications to the relevant competition authorities for the merger control clearances required for the contemplated transaction, which are expected to be made in the near future. Further announcements will be made as appropriate.

Felix Evtushenkov, First Vice-President of Sistema, commented: "Investment in the Argos Group presents an attractive opportunity, given the prospects of the logistics segment in the oil industry, the highly-skilled management team of the Argos Group, and potential synergy between the Argos Group and Sistema's oil assets. As a strategic investor Sistema will provide the Argos Group with an opportunity to expand its business, strengthen its market position in Western Europe and establish strong relations with Russian suppliers of hydrocarbons."

Peter Goedvolk, Chief Executive Officer of Argos, added: "We are highly enthusiastic about having Sistema as our strategic investor as it will help us to accelerate our growth strategy. There is good scope for cooperation between the Argos Group as a large player in the oil trading and logistics market, and Sistema's upstream and downstream oil assets. Such cooperation will help us to expand and strengthen our market positions both in terms of geographic presence as well as product offering."

Argos Group

The Argos Group is active in all segments of the oil and fuel related supply chain in Western Europe. It services the entire value chain, from producer to consumer. The Argos Group has its own distribution channels and uses its own and leased infrastructure. Its annual turnover exceeds US$ 14 billion and 17,5 mln.m³ of various products, servicing over 100 fueling stations and operating over 1,0 mln.m³ of storage facilities. Over 800 FTE employees are globally active in more than 20 countries. The core countries for Argos Group's operations are Belgium, Germany, Luxemburg, the Netherlands, France and Switzerland. Outside Europe, the company is active in Brazil, Singapore and China.

For information about Argos Group, please visit  http://argosenergies.com   

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For further information, please visit www.sistema.com or contact:

Investor Relations

Evgeniy Chuikov

Tel.: +7 (495) 692 1100

ir@sistema.ru

 Public Relations 

 Vsevolod Sementsov

 Tel.:+7 (495) 730 1705

 pr@sistema.ru 

Sistema is the largest publicly-traded diversified holding company in Russia and the CIS, which invests in and is a major shareholder of companies serving over 100 million customers in the sectors of telecommunications, high technology, oil and energy, radars and aerospace, banking, retail, mass-media, tourism and healthcare services. Founded in 1993, the company reported revenues of US$ 8.1 billion for the second quarter of 2012, and total assets of US$ 43.6 billion as at June 30, 2012. Sistema's global depository receipts are listed under the symbol "SSA" on the London Stock Exchange. Sistema's ordinary shares are listed under the symbol "AFKS" on the MICEX-RTS Stock Exchange, and under the symbol "SIST" on the Moscow Stock Exchange (MSE). Sistema was ranked number 315 in the 2011 edition of the Fortune Global 500 list. Website: www.sistema.com

The Company is not an investment company, and is not and will not be registered as such, under the U.S. Investment Company Act of 1940.

Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of Sistema. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might" the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to Sistema and its operations.

This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or other securities of JSFC Sistema or Argos or any of their respective subsidiaries or affiliated companies, nor shall any part of it nor the fact of its distribution form part of or be relied on in connection with any contract or investment decision relating thereto, nor does it constitute a recommendation regarding the shares or securities of JSFC Sistema or Argos or any of their respectivesubsidiaries and affiliated companies.

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