OREANDA-NEWS. February 3, 2012. Rostelecom OJSC (MICEX & RTS: RTKM, RTKMP; OTCQX: ROSYY) (the Company), Russias national telecommunications operator, today announces that its wholly-owned subsidiary, Teleset Networks LTD, has invested USD  22.5 million (approximately RUB 682 million[1]) in GNC?ALFA, the largest independent Internet and data provider in Armenia, and gained 75% minus one share control of the company.

GNC-ALFA operates a modern fibre-optic network spanning approximately 1,500 km, which passes through 70% of the territory of the Republic of Armenia. GNC-ALFAs network is interconnected with the regions major backbone networks and major MMR (meet-me-room) centres, as well as with international gateways with Iran and Georgia. GNC-ALFA is the largest independent aggregator of national IP-traffic, and its subsequent transit, in Armenia. In 2012, GNC-ALFA plans to actively develop its broadband Internet and pay-TV services for individuals in Armenia. This will stimulate growth in its business and it will enable the company to capitalise on high demand from end-users in the Armenian market which also has strong potential for increases in penetration. GNC-ALFA reported revenues of approximately USD  12 million with an EBITDA margin of 48% for the full year of 2011. The companys current net debt stands at less than USD  1 million.

Alexander Provotorov, President of Rostelecom, commented: This is the first acquisition outside of Russia that we have concluded as part of our international expansion policy. The acquisition of a control stake in GNC-ALFA provides Rostelecom with access to a well-developed infrastructure for broadband and pay-TV services in the Armenian telecommunications market, a market which has a significant growth potential.