OREANDA-NEWS. Mobile TeleSystems OJSC, the largest mobile phone operator in Russia and the CIS, announced that Moody's Investors Service has upgraded the corporate family and existing bond ratings of MTS to Ba2 from Ba3. The outlook on the ratings is positive.

According to MTS with reference to a press release by Moody's, the upgrade reflects the fact that the company (i) demonstrates robust operational and financial performance in the second half of 2006 and six months of 2007; (ii) displays ability to sustain its market share in Russia, strong positions in Ukraine and a number of other CIS countries; (iii) provide free cash flow generation in the first half of 2007; (iv) has significantly improved profitability metrics; (v) displays modest leverage below 1.0x Total Adjusted Debt to reported EBITDA on an annualized six months basis, (vi) has relatively conservative and consistent management strategy as regards acquisition activities; and (vii) there is a higher level of predictability in the company's financial policies over the past 12 months.

In addition, according to Moody's, given the positive outlook, future upgrade remains a strong possibility.