OREANDA-NEWS. Open Joint Stock Company “MegaFon" (LSE: MFON), a leading Russian telecommunications operator (“MegaFon" or “the Company"), has been informed that USM Holdings Limited ("USM") has announced a share buy-back involving the repurchase of 10% of USMґs shares from its majority shareholder, Alisher Usmanov.

MegaFon understands that these 10% shares are being allocated among and acquired by senior executives, including Ivan Streshinsky, the Chairman of Metalloinvest, Ivan Tavrin, the CEO of MegaFon, and members of the Board of Directors of USM. MegaFon recognizes that the announced transaction is intended to incentivize and retain USM management and is in line with the disclosures made in connection with the IPO of MegaFon.

In addition, MegaFon understands that in recognition of the leadership role of Mr Moshiri as Chairman of the USM Board of Directors, he will now vote his own 10% stake in USM as well as the 30% stake of USM's second largest shareholder. MegaFon has also been informed that separately, two long-term partners of Mr. Usmanov are each converting their indirect economic interest that they have had for a significant period of time in USM into an interest in 1% for each of them of USM. MegaFon acknowledges that while ceding control, Mr. Usmanov will remain the largest USM shareholder with a total voting power of 48.0%.

There is no change to the number, or composition, of the elected directors on the board of MegaFon as a result of these changes.