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MTS Acquires Telecom & CPaaS Provider MTT

June 30, 2021

MOSCOW, Russia – Mobile TeleSystems PJSC (“MTS” or “the Company”) (NYSE: MBT; MOEX: MTSS), Russia’s largest mobile operator and a leading provider of media and digital services, announces the 100% acquisition of Multiregional TransitTelecom OJSC (“MTT”) for RUB 5.0 bn (on an enterprise value basis). MTT is one of the top-10 largest telecom companies in Russia and a leading provider of intelligent connectivity solutions for businesses.

Beyond offering traditional B2B/B20 telecom interconnect services, MTT is a major player in the promising communications-platform-as-service (CPaaS) space. The company provides a wide range of advanced CPaaS solutions for SME and enterprise clients, including cloud-based phone systems (virtual PBX) as well as telecommunications-focused application program interfaces (APIs). Telecom APIs enable software developers to easily integrate omnichannel communications — such as voice, messaging, SMS, and email — into their apps in a modular, scalable manner.

Inessa Galaktionova, MTS First VP for Telecommunications, commented: “Today, the global virtual PBX and CPaaS market is seeing exceptional double-digit growth of around 15-20% a year. While the Russian sector is still developing, we believe it is poised to take off and could outpace the global market over the next few years. Acquiring an established player will enable us to jump start our portfolio, accelerating our ambition to become a market leader in the segment,” she said, adding: “By integrating MTT’s solutions we can better meet the market’s growing needs for reliable, real-time customer communication, which is particularly important in high-growth tech sectors such as ecommerce, telemedicine, eticketing, and ride-hailing and delivery.”

MTT Group CEO Evgeny Vasiliev commented: “We have been on a long journey that saw us evolve from being a ‘heavyweight’ transit operator to becoming Russia’s market leader in Telecom API and Unified Communications. This has proven that we made a smart bet with MTT’s innovation strategy, which is aimed at winning in this dynamically growing segment. We are developing in both of our growth directions and we expect to see significant growth in the near future. The deal with MTS will enable MTT to open a new page in its history. The potential synergies in telecommunications as well as cloud and voice services will unlock additional opportunities to help our companies’ business clients further digitally transform their operations.”

The acquisition earlier received all necessary approvals, including from the Russian Federal Antimonopoly Service (FAS).

About MTT

MTT was founded in 1994 in order to facilitate inter-operator network coordination. As one of Russia’s largest alternative operators, the company continues to work with leading providers of mobile and fixed-line connectivity in areas including intercity and international traffic, as well as in coordinating roaming and other B2O services.

Today, the company’s key business lines and growth vectors include:

  • Unified Communications (UC) — Virtual PBX, FMC, call tracking, callback, CRM, call recording, messaging, mobile app development, etc. 
  • Telecom API (XaaS / CPaaS) — intelligent tools based on the MTT platform that enable businesses to integrate multichannel, high-frequency customer communications in their apps and products.
  • Conversation agents (voice bots) — MTT’s VoiceBox service enables businesses to automate call placement and acceptance — such as for call centers, sales offices, and human resources (HR) — and also features capabilities for speech synthesis, recognition, and recording, as well as tools to integrate with social networks and CRM platforms.

MTT also operates its own MVNO and has developed an overarching tool to create and launch MVNOs, the Mobile Virtual Network Enabler.

Learn more at https://en.mtt.ru/

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For further information, please contact in Moscow:

Investor Relations

Mobile TeleSystems PJSC

Tel: +7 495 223 2025

E-mail: ir@mts.ru

Learn more about MTS on the company’s Investor Relations website at ir.mts.ru

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Mobile TeleSystems PJSC (“MTS” – NYSE: MBT; MOEX: MTSS) is Russia’s largest mobile operator and a leading provider of network-native digital services. The company offers a full range of solutions for consumers and business customers across wireless and wireline connectivity; over-the-top, linear, and satellite television; digital-first banking and financial services; as well as cloud computing and IoT. By early 2021, there were more than 86 million mobile subscribers using MTS services across the company’s operations in Russia, Armenia, and Belarus, including around 78 million subscribers in Russia alone. In addition, MTS has a nationwide network of more than 5,000 owned and franchised retail outlets in Russia, and provides nearly 10 million households with broadband, TV, and/or fixed-line telephone connectivity. MTS is majority-owned by Sistema PJSFC, a publicly-traded Russian investment company. MTS’s depositary receipts are listed on the New York Stock Exchange under the ticker MBT and its shares on the Moscow Exchange under the ticker MTSS. For more information, please visit the company’s Investor Relations website at ir.mts.ru.

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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 MTS, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify forward looking statements by terms such as “expect,” “believe,” “anticipate,” “estimate,” “intend,” “will,” “could,” “may” or “might,” and 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 undertake or intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. We refer you to the documents MTS files from time to time with the U.S. Securities and Exchange Commission, specifically the Company’s most recent Form 20-F. These documents contain and identify important factors, including those contained in the section captioned “Risk Factors” that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, the severity and duration of current economic and financial conditions, including volatility in interest and exchange rates, commodity and equity prices and the value of financial assets; the impact of Russian, U.S. and other foreign government programs to restore liquidity and stimulate national and global economies, our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so, strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses, potential fluctuations in quarterly results, our competitive environment, dependence on new service development and tariff structures, rapid technological and market change, acquisition strategy, risks associated with telecommunications infrastructure, governmental regulation of the telecommunications industries and other risks associated with operating in Russia and the CIS, volatility of stock price, financial risk management and future growth subject to risks.