OREANDA-NEWS. On 02 July 2008 LSR Group, a leading real estate developer and building materials producer in Russia (LSE: LSRG; MICEX, RTS: LSRG) announced that the Board of Directors of the Group has approved two transactions. The value of transactions is not disclosed.

As part of the strategy to geographically diversify and strengthen the Company's positions in the construction and building materials markets of Yekaterinburg (Urals Region), the Board of Directors of LSR Group approved two transactions:

1. Transaction to acquire a 100% stake in OOO Uralscheben.

OOO Uralscheben is one of the key players in the crushed stone market of Yekaterinburg: according to the estimates by the specialists of OOO Uralscheben, the market share of the company in Yekaterinburg in 2007 was 5%.  OOO Uralscheben holds 100% shares in both OOO Rezhevsky DSZ and OOO Gagarinsky Granitny Kariyer, both companies having all necessary licenses to use the subsoil from the two quarries with a total volume of proven reserves around 160 million cub.m.

2. Transaction to acquire a 75% stake in OOO PKU Nova-StroyProekt.

The core business of OOO PKU Nova-StroyProekt is designing houses from detached houses to neighbourhoods and compounds, designing panel and frame buildings, parking lots, garages and motor roads. The company has a license to develop buildings and structures of levels 1 and 2. The company's track record includes 400 implemented projects.

Igor Levit, CEO and member of the Board of Directors of OJSC LSR Group, commented as follows:

"The acquisition of companies such as Uralscheben and PKU Nova-StroyProekt provides a consistent follow-up to LSR's plans to set up a regional division in the Urals repeating the unique vertically integrated business model of our company in the market of Yekaterinburg and the Sverdlovsk region, which is strategically important for us. The new acquisitions - a crushed stone business and a design office - will enable us to provide our operations in Yekaterinburg with necessary raw materials because crushed stone is an aggregate necessary for producing both prefabricated housing panels and reinforced concrete and ready-mix concrete, as well as to provide for professional designing of both detached houses manufactured by our prefab construction company and whole neighbourhoods."

In April this year LSR Group acquired an 87% stake in OJSC Betfor Reinforced Concrete Factory, the largest prefab construction manufacturer and producer of reinforced concrete, ready-mix concrete and aerated concrete in Yekaterinburg, where the Group already owns approx. 60 hectares of land plots and planning to implement economy class neighbourhood projects.