Moscow, Russia – February 24, 2012 – Rostelecom OJSC (MICEX & RTS: RTKM, RTKMP; OTCQX: ROSYY) (“the Company”), Russia’s national telecommunications operator, today announces that on March 1, 2012, its Board of Directors will determine the offering price of Rostelecom securities, specifically, thirteen issues of non-convertible documentary interest-bearer bonds with mandatory centralised custody. It is proposed that the Board of Directors will set the offering price at RUB 1,000 per bond, which is 100% of its nominal value.

As a result, Rostelecom will start obtaining the necessary approvals to organise the bond issue for a total nominal value of RUB 100 billion. This will include exchange-traded bonds totalling RUB 60 billion, which are expected to mature in 3 years, and a second issue of exchange-traded bonds totalling RUB 40 billion, which are expected to mature in 5 years.

It is planned that confirmation of the Decision on the bond issue and the Prospectus for the securities will be taken later at a separate meeting of the Board of Directors, after the Federal Agency for State Property Management recognises a price for the placement of the bonds that is accurate and may be recommended for the successful completion of the deal.

The Company will decide on when to place the bonds, and over what period, depending on the state of the financial markets and the cost of alternative sources of financing. It is planned that among other objectives, the bond proceeds will be used to refinance existing debt. 

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For more information please visit www.rt.ru/en or contact:

Investor Relations Department

Tel. +7 (499) 995 97 80

ir@rt.ru

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Rostelecom (www.rt.ru/en) is Russia’s national telecommunications operator and now also includes the regional incumbent telecommunications operators (CentreTelecom, SibirTelecom, Dalsvyaz, Uralsvyazinform, VolgaTelecom, North-West Telecom and Southern Telecommunications Company) and Dagsvyazinform. Rostelecom has the largest domestic backbone network (approximately 500 thousand km) and last mile connections to approximately 35 million households in Russia. The Company holds licences to provide a wide range of telecommunications services (telephony, data, TV and value-added solutions) to residential, corporate and governmental subscribers and third party operators across all regions of the Russian Federation. The Rostelecom brand is one of Russia’s ten most trusted brands (source: Romir market research).

Rostelecom’s ordinary and preferred shares are traded on the MICEX-RTS (RTKM, RTKMP) stock exchange, and its depository receipts are traded over-the-counter in the United States on the OTCQX under the symbol ‘ROSYY’. Rostelecom is majority owned (53.2% of ordinary shares) by the Russian Government and has a free float of 36.8% of the outstanding ordinary shares and 71.1% of the outstanding preferred shares. Standard&Poor’s has assigned Rostelecom a ‘BB+’ international credit rating with a ‘Stable’ outlook. Rostelecom had 28.8 million local fixed-line voice subscribers, 12.7 million mobile voice subscribers, 7.9 million fixed-line broadband subscribers and 5.8 million pay-TV subscribers at the end of the third quarter of 2011. The Group generated RUB 275.7 billion of combined and consolidated revenues, RUB 101.4 billion of OIBDA (36.8% of revenues) and RUB 31.3 billion of net income for the twelve months ended December 31, 2010.

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Certain statements in this press release are forward-looking statements within the meaning of the U.S. federal securities laws and are intended to be covered by the safe harbors created thereby.

Those forward-looking statements include, but are not limited to:

•           Management’s assessment of the Company’s future operating and financial results as well as forecasts of the present value of future cash flows and related factors;

•           the Company’s anticipated capital expenditures and plans to construct and modernize its network;

•           the Company’s expectations as to the growth in demand for its services, plans relating to the expansion of the range of its services and their pricing;

•           the Company’s plans with respect to improving its corporate governance practices;

•           the Company’s expectations as to its position in the telecommunications market and the development of the market segments within which the Company operates;

•           economic outlook and industry trends;

•           the Company’s expectations as to the regulation of the Russian telecommunications industry and assessment of impact of regulatory initiatives on the Company’s activity;

•           other statements regarding matters that are not historical facts.

Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include:

•           risks relating to changes in political, economic and social conditions in Russia as well as changes in global economic conditions;

•           risks relating to Russian legislation, regulation and taxation, including laws, regulations, decrees and decisions governing the Russian telecommunications industry, securities industry as well as currency and exchange controls relating to Russian entities and their official interpretation by regulatory bodies;

•           risks relating to the Company, including the achievement of the anticipated results, levels of profitability and growth, ability to create and meet demand for the Company’s services including their promotions, and the ability of the Company to remain competitive in a liberalized telecommunications market;

•           technological risks associated with the functioning and development of the telecommunications infrastructure, technological innovations as well as the convergence of technologies;

•           other risks and uncertainties. For a more detailed discussion of these and other factors, see the Company’s Annual Report and the Company’s other public filings.

Many of these factors are beyond the Company’s ability to control or predict. Given these and other uncertainties, readers are cautioned not to place undue reliance on any of the forward-looking statements contained herein or otherwise. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements (which are made as of the date hereof) to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required under applicable laws.