SISTEMA-HALS AND SIEMENS AGREE TO TERMINATE INVESTMENT AGREEMENT

MOSCOW, RUSSIA - May 29, 2009 - Sistema-Hals and Siemens AG today announced the mutual decision to terminate the Framework Investment Agreement (the 'Agreement') initially signed in July 2003 to develop an office building complex in Moscow (Leningradsky Prospect, 39). As of today the construction of the building has not been completed. 

All the obligations of any kind or nature between the parties under the Agreement shall be fully settled upon a lump-sum settlement payment by Sistema-Hals in the amount of €18 million due by June 30, 2009. Following that, Sistema-Hals may develop the project at its own discretion.

Sistema-Hals ('the Company') is a leading diversified company in the Russian and CIS real estate market. The core businesses of Sistema-Hals are development, asset management and facilities management.

The Company was the first Russian property developer to list its shares on the main market of the London Stock Exchange. The Company's shares are also listed on the Moscow Interbank Currency Exchange and the Moscow Stock Exchange.

Since starting operations in 1994, Sistema-Hals has successfully completed about 40 projects with a total area in the region of 340,000 square metres, including the headquarters of DaimlerChrysler, the Hals Tower office building, the headquarters of Trubnaya Metallurgical Company and a hotel for the MaMaison chain (Orco Property Group).

Sistema-Hals has assembled a balanced and diversified portfolio of assets in fast-growing sectors of the market. The Company's strategy is focused on building Class A and B office space, mixed-use retail and office complexes, business-class homes, residential estates and land development.

Cushman & Wakefield Stiles & Riabokobylko valued the Sistema-Hals share of properties and projects in its portfolio at $2,049 million as at 1 January 2009.

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The information in the press release may contain forward-looking statements regarding future events or the future financial performance of Sistema-Hals. You can identify forward looking statements by terms such as 'expect', 'believe', 'anticipate', 'estimate', 'intend', 'will', 'could', 'may' or 'might' the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements to reflect events and circumstances occurring after the date thereof or to reflect the occurrence of unanticipated events.