OREANDA-NEWS. January 25, 2008. LSR Group, one of the leading real estate developers and building materials producers in St Petersburg and the Leningrad region, today announced that on January 24 the Board of Directors of OJSC LSR Group granted the request of Mr. Andrey Molchanov, the founder of LSR Group and a nominated candidate for the position of the Chairman of the Board, to withdraw his candidacy from consideration at the EGM scheduled for the 7th February 2008. Mr Molchanov’s request is due to his nomination to the Upper House of the Russian Federation Federal Assembly as a Senator. Under existing Russian legislation the status of Senator prevents its holder from participation in the management of a business entity.

As previously announced, the Group intends to increase its Board of Directors. Board meeting held in January 2007 nominated eight candidates to the new Board, however due to Mr. Molchanov’s decision it is now proposed to increase the Board from five to seven members, comprising four Executive Directors and three Non-Executive Directors.  Subject to their appointment to the Board by LSR’s shareholders at an EGM on 7th February 2008, the current members of the Board - Igor Levit, Dmitry Goncharov, Mikhail Romanov, and two independent directors - Sergey Skaterschikov and Lauri Ratia are nominated for re-election. Elena Tumanova, CFO of LSR Group is nominated as a new Executive Director and Seppo Juha Remes (Finland), a President of Kiuru Partners LLC, as a new Non-Executive Director.

Commenting on today’s announcement Igor Levit, CEO of LSR Group, said: “We are committed to the highest standards of Corporate Governance and I am delighted to welcome the new additions to the Board. We believe our investors will recognise the strength of the the team we have assembled to meet the new challenges as a public company while delivering on the growth strategy. I would also like to congratulate Andrey Molchanov on his nomination for the position of Senator representing the Leningrad Oblast and wish him every success in his new role.”