Yerevan, August 21 /Mediamax/. Russian AFK “Sistema” (MTS mobile operator) is negotiating on the purchase of “KH-Telecom” Company (VivaCell trademark) – the largest mobile operator in Armenia.

The Russian “Vedomosti” newspaper reported this today, referring to the President of AFK “Sistema” Aleksandr Goncharuk. He stated that the negotiations on the purchase of “KH-Telecom” continue, and it is not clear when the deal may be concluded.

The newspaper also states that analysts assess “KH-Telecom” Company to a sum of $600mln.

On July 12 of 2007, the General Director of VivaCell Ralph Yirikian refuted the statements on the possible sale of the Company. He compared VivaCell “to an 18-year-old young lady, who has many worshippers, who want to tie their lives with hers”. However, he noted, “the young lady does not want to get married, but she wants to realize her plans”.

On August 15 of 2007, commenting in an interview to Mediamax on the statements, according to which the representatives of MTS arrived in Yerevan to carry out the final assessment of the cost of VivaCell, Spokeswoman of MTS Irina Osadchaya stated that “our stance remains unchanged - we are interested in acquisitions in Armenia and we are examining all the possibilities on this market”.

MTS is the largest mobile operator in Russia as to its subscribers and the volume of profit. It maintains 78,5mln subscribers in Russia and other CIS states. 52,8% of its shares belong to AFK “Sistema”, about 40% is put on trade on the New York Stock Exchange in ADR. Capitalization of MTC as of August 20 makes $23,3bln, the net profit for 2006 – $1.08bln.