SSA.L Regulatory News (SSA)

VTB Capital invests in Binnopharm Group

Moscow, 29 June 2021 - VTB Capital has invested in the pharmaceutical holding company Binnopharm Group. Sistema's wholly-owned subsidiary LLC Sistema Telecom Assets sold an 11.2% stake in Ristango Holding Limited, which owns 100% of the authorised capital of Binnopharm Group, to Nevsky Property Investments Limited (controlled by VTB Capital). The transaction totalled RUB 7 billion.

As a result, Sistema's effective stake in Binnopharm Group together with its financial partner (VTB Bank[1]) stands at 75.3%; a consortium of investors consisting of the Russian Direct Investment Fund (RDIF), the Russia-China Investment Fund (co-founded by RDIF and China Investment Corporation) and leading Middle Eastern funds holds 12.5%; VTB Capital, represented by Nevsky Property Investments Limited, holds 11.2%. The remaining 1% of shares in Binnopharm Group are owned by a minority shareholder (an individual).

Vladimir Chirakhov, President of Sistema:

"We are pleased that our achievements in developing Binnopharm Group as part of a strategy aimed at transforming the company into one of the leaders of the Russian pharmaceutical market were highly appreciated by VTB Group. Our cooperation within the pharmaceutical holding company will continue, but VTB Group will play a new role as Binnopharm Group's shareholder. Sistema remains the main managing shareholder of Binnopharm Group and will continue to implement its development strategy."

Yuri Soloviev, First Deputy President and Chairman of VTB:

"Pharmaceutical industry is one of the socially significant sectors of the Russian economy. Its importance in addressing new challenges in healthcare and supporting public health was demonstrated in 2020. Today Binnopharm Group plays an important role in tackling urgent health issues associated with the pandemic. The company's main focus is the rapidly developing generics segment, which is also of interest to us as a shareholder. We have a long-term, successful history of working with Sistema; we are jointly developing the pharmaceutical segment of the group's activities and see our role as helping to finance the company and the industry. We believe that VTB's experience and expertise will support the company in actively developing its business, achieving ambitious new goals and providing attractive returns to shareholders."

Binnopharm Group is a full-cycle Russian pharmaceutical holding company that combines five production sites located in different regions of Russia: JSC Alium (formerly OBL Pharm in the Serpukhov district of the Moscow region), JSC Binnopharm (two sites: Zelenograd and Krasnogorsk), OJSC Sintez (Kurgan) and CJSC Biocom (Stavropol). The Binnopharm Group companies produce a wide range of drugs across therapeutic groups and have the largest portfolio of drugs among Russian manufacturers (more than 450 marketing authorisations, including the COVID-19 vaccine Sputnik V).

***

For further information, please visit www.sistema.com or contact:

***

VTB Bank (PJSC), together with its subsidiary banks and financial institutions (VTB Group), is an international financial group offering a wide range of financial and banking services in Russia, the CIS, Western Europe, Asia and Africa. VTB Bank provides a full range of banking services through a wide network of branches. The Group's subsidiaries offer leasing, factoring and other financial services. VTB Group's international network includes over 20 banks and financial companies in more than 20 countries. As of 31 March 2021, VTB Group was the second largest financial group in Russia by assets (RUB 18.6tn) and customer deposits (RUB 13.7tn). The main shareholder of VTB is the Government of the Russian Federation, which owns 60.9% of the voting shares. For more information, please visit www.vtb.com.

***

Sistema PJSFC is a publicly traded Russian investment company with a diversified portfolio of assets serving over 150 million customers in sectors including telecommunications, high tech, banking, retail, e-commerce, forestry, agriculture, real estate, hospitality and healthcare. The Company was founded in 1993. Revenue in 2020 reached RUB 691.6bn, and total assets as of 31 December 2020 stood at RUB 1.4tn. Sistema's global depositary receipts are listed on the London Stock Exchange under the ticker "SSA". Sistema's ordinary shares are listed on Moscow Exchange under the ticker "AFKS". Website: www.sistema.com

[1] Previously, as a financial partner, VTB Bank jointly with Sistema financed the acquisition of JSC Obolenskoye Pharmaceutical Company (renamed to Alium) in 2018 and OJSC Sintez in 2019. Both enterprises subsequently became part of the pharmaceutical holding company Binnopharm Group. Sistema and VTB Bank signed agreements on the acquisition of VTB Bank's interests in Binnopharm Group.