Sistema and MTS to Jointly Develop Content Business
OREANDA-NEWS. June 04, 2012. Sistema JSFC ("Sistema") (LSE: SSA), the largest diversified publicly-traded investment company in Russia and the CIS, today announces that it has agreed to join forces with Mobile TeleSystems OJSC ("MTS") in developing and managing the multimedia content portal Stream.ru (formerly Omlet.ru).
Sistema contributed RUB 496.1 million to the Stream's charter capital and, upon completion of state registration procedures in accordance with Russian law, will obtain a 55% stake. This reduces MTS' stake to 45%.
Stream LLC will operate under the Stream brand and will be managed by Sistema's subsidiary Sistema Mass Media JSC.
Andrei Dubovskov, President and Chief Executive Officer of MTS, highlighted, "MTS has developed one of the most successful start-ups in the Russian media content market. The time has come to elevate this project to the next stage, which requires attracting both financial resources and experience in media. Investments from Sistema and the unique expertise of Sistema Mass Media will enable Stream.ru to enhance its position in the fast-growing market for video and audio content. The structure of the transaction allows MTS to
retain stake in the asset in order to leverage competitive advantages through the launch of media content services in mobile and fixed networks. We also expect the transaction to add momentum to the development of the legal content market in Russia."
Mikhail Shamolin, President and Chief Executive Officer of Sistema, commented, "We envision Stream's mission in becoming a universal point of access to the variety of media content. We think that the financial resources of Sistema, MTS' expertise, as well as Sistema Mass Media's experience in production, aggregation and distribution of video content, will allow to create a leader in the Russian media content market and increase shareholder value."
Stream.ru is a multimedia content portal launched by MTS in 2009. Its content is available on Smart TV devices from Samsung, LG, Panasonic, Philips as well as smartphones, tablets.
set-top boxes, and PCs. Stream's portfolio includes about 7,000 movies and TV series episodes from leading international and Russia studios (Universal, Sony Pictures Entertainment, Warner Bros. Entertainment, Walt Disney, Bazelevs, Central Partnership). Monthly audience of the portal consists of more than 1.5 million unique visitors.
The Company is not an investment company, and is not and will not be registered as such, under the U.S. Investment Company Act of 1940.