OREANDA-NEWS. On May 25, 2007  “COMSTAR - United TeleSystems” JSC (“Comstar”) (LSE: CMST)  announced that the Board of Directors (the “Board”) of Moscow City Telephone Network (“MGTS”), Comstar’s 55,73% subsidiary, set the date for the Company’s Annual General Meeting of Shareholders (“AGM”) for June 29, 2007, reported the press-centre of COMSTAR.

The Board recommended an annual dividend of approximately RUR 1,3 billion, or approximately US$ 51,51 million, for the twelve months ended December 31, 2006, to holders of MGTS shares, as at the record date of May 12, 2007.  The dividend, which amounts to a payment of RUR 8,75 per ordinary share (approximately US$ 0,341), and of RUR 39,77 per preferred share (approximately US$ 1,541 ), is due to be paid by the end of 2007, according to MGTS Charter.

Subject to the AGM approval, total dividend payment to the holders of ordinary shares will amount to approximately RUR 698,5 million (approximately US$ 27,0 million) representing approximately 11% of MGTS’ stand alone net income for 2006 under Russian Accounting Standards (RUR 6,3 billion or US$ 245,3 million1). Total payment to the holders of preferred shares will be approximately RUR 635,0 million (approximately US$ 24,5 million1) or approximately 10% of MGTS net income.

The Board recommended to uphold the decision of the AGM, held on June 17, 2006, not to pay an annual dividend for the twelve months ended December 31, 2005.