Alfa-Bank - Alfa Group

Our assetsAt present, Altimo manages assets with a total market capitalisation of more than US$20 billion. Investments include:VimpelCom[Beeline Trademark]VimpelCom is one of the two leading cellular communications operatorsin Russia; it provides services under the Beeline trademark.VimpelCom's cellular communications service license covers a territorywith 94% of Russia's population (134 million people). In 2005, thecompany received a license to provide long-distance and internationalcommunications services.In November 1996, VimpelCom became Russia's first company to listits shares on the New York Stock Exchange (NYSE). For over ten yearsSubscriber Growth(end of year)60 mln5,000Total Operating Revenues(in USD mln)now, VimpelCom has been a leading Russian company in terms of professionalstandards and transparency. Independent organizationshave on many occasions cited VimpelCom as a leader in corporategovernance and investor relations.In 2006, VimpelCom exhibited a high rate of growth on the Russiantelecommunications market. At 31 December 2006 the company'scustomer base in Russia exceeded 48 million subscribers. The companycontinues to execute its strategy of expanding into the emergingmarkets of the CIS, and it is Kazakhstan's second largest operator.In 2005, VimpelCom successfully entered the markets ofUkraine, Uzbekistan and Tajikistan and in July 2006 and inNovember 2006 acquired operators in Georgia and in Armenia,respectively.MegaFonKyivstarKyivstar GSM is the leader on the Ukrainian mobile communications market. The company is licensed to use mobile, municipal, long-distanceand international telephone networks and holds licenses for the construction and servicing of its own stationary networks and datatransmission networks. The company networks use the GSM 900/1800 standards.In 2006, Kyivstar once again confirmed its status as a leader of the Ukrainian market by increasing the number of subscribers to 21.5 millionand bringing mobile communications to 99% of the Ukrainian population.Growth in Net Revenues and EBITDA (in USD mln)for the Years 2002–20061,8001,5001,200900600300250144Net RevenueEBITDAMargin, %374224Source: Company data* According to Altimo’s estimates64137758 60 592002 2003 20041 ,1366351 ,7801,05956 59.02005 2006*100%50%Growth in Kyivstar’s Subscriber Base (end of year)24,000,00020,000,00016,000,00012,000,0008,000,0004,000,0001,855,90020023,036,6076,252,022Source: Company data* According to Altimo’s estimates13,924,96621,500,0002003 2004 2005 2006*50 mln40 mln30 mln45,430,30055,200,0004,0003,0003,2114,868MegaFon is Russia's third largest provider of GSM 900/1800 mobilecommunications with license coverage of 100% of the Russian population(143 million people) in all 89 regions of the country. The widerange of the mobile service licenses gives the company a solid competitiveadvantage in the midterm. At 31 December 2006 the mobilecommunications market share of the company exceeded 19% and thenumber of subscribers totaled 30 million people.Golden Telecom,Inc.Golden Telecom, Inc. (listed on NASDAQ) is a leading independent fixed-line communications operator in Russia; it possesses its own infrastructurefor the provision of integrated telecommunications and Internet services in Russia and a number of the CIS countries. In early 2007,the company started providing long-distance and international communications services.20 mln10 mln11,436,90026,583,3002003 2004 2005 2006Source: Company dataSky Mobile2,0001,0001,3362,1132003 2004 2005 2006Source: Annual audited US GAAP consolidatedfinancial statementsMegaFon operates in compliance with international standards of technologyand subscriber services. MegaFon uses advanced GSM-equipmentto provide Russian subscribers with world class services.MegaFon provides mobile communication services in Tajikistan whereits subsidiary, TT Mobile, is a leading mobile communicationsprovider.In 2006, Altimo acquired 51% of the shares of Sky Mobile, LLC operating on the dynamically growing mobile communications market ofKirghizia. Today, Sky Mobile is Kirghizia’s largest GSM mobile operator with a license covering its entire territory. At 31 December 2006 SkyMobile had 900 thousand subscribers and a market share of more than 87%.The efficient work of Golden Telecom's new management team enabled the company to double its market capitalisation in 2006. Golden Telecom is theleader among corporate service providers in the large cities of Russia and the CIS such as Moscow, Kiev, and Nizhniy Novgorod, and runs second in St.Petersburg. Golden Telecom Ukraine, LLC is one of the leading independent fixed-line communications operators active in all major cities of Ukraine.Consolidated Revenue for the Years 2000–2006 (in USD mln)900800700600500400300200100113200014020011992002361200358420046678552005 2006Source: Annual audited US GAAP consolidated financial statementsTurkcellTurkcell Iletisim Hizmetleri A.S. started operating GSM mobile communicationservices on the Turkish market in 1993 and is the currentmarket leader. As of 1 January, 2007 Turkcell served 32 million subscribers,which is a 60% share of the Turkish market.The company also holds mobile communications assets in Ukraine,Georgia, Moldova, Kazakhstan and Azerbaijan. In July 2000,Turkcell became Turkey's first company to be listed on the New YorkStock Exchange (NYSE). Turkcell is also quoted on the Istanbulstock exchange (IMKB).Turkcell is owned by Alfa Finance Holdings S.A. and is managed byAltimo.68 / ALFA GROUP / ANNUAL REPORT 2006 ALFA GROUP / ANNUAL REPORT 2006 / 69