UPDATE 1-Russia’s MTS buys internet provider Multiregion

* Pays $123.5 mln in cash for 100 pct stake

* Says to assume nearly $94.4 mln of debt

* Deal part of strategy to expand in fast-growing market

(Adds details, CEO comment, background)

MOSCOW, July 16 (BestGrowthStock) – MTS (MBT.N: )(MTSI.MM: ), Russia’s
biggest mobile phone operator, said on Friday it had acquired
broadband and cable TV provider Multiregion in a move to boost
exposure to the fast-growing market segments.

MTS, the key asset of services conglomerate Sistema
(SSAq.L: ), paid $123.5 million in cash for a 100 percent stake
and will assume debts totalling roughly $94.4 million.

“The acquisition will significantly enhance our position in
the rapidly growing broadband and cable TV markets in the
Russian regions,” Chief Executive Mikhail Shamolin said in a
statement.

“As the largest integrated telecommunications provider in
Russia and the CIS, MTS will be able to provide its customers a
broad, innovative and bundled offering of mobile and fixed line
telephony, high-speed broadband internet access and television
services in over 110 cities in Russia.”

Russian mobile phone operators are seeking to boost their
exposure to the fast-growing, but underdeveloped, broadband
Internet market as mobile phone penetration in Russia nears 145
percent and data transfer displaces voice as the main driver of
sales.

MTS, which in April applied to the competition watchdog for
approval to buy Multiregion, [ID:nLDE6350QP] said Multiregion’s
financial results will be consolidated in its financial
statements from July 16, 2010.
(Reporting by Anastasia Teterevleva; writing by Maria
Kiselyova; editing by Simon Jessop)

UPDATE 1-Russia’s MTS buys internet provider Multiregion