Megafon : Results of the Tender Offer to purchase MegaFon’s ordinary shares and global depositary receipts

Pursuant to the Tender Offer, MICL offered to purchase up to 128,950,036 Ordinary Shares, including GDRs, representing 20.80% of the issued and outstanding ordinary shares of the Company, at a purchase price of US$9.75 (or its equivalent in Russian roubles for each Ordinary Shares and for each GDR. As announced by MICL, as of the Expiration Time of the Tender Offer, 57,031,834 (Fifty seven million thirty one thousand eight hundred thirty four) Ordinary Shares and 58,293,820 (Fifty eight million two hundred ninety three thousand eight hundred twenty) GDRs had been tendered for sale pursuant to the Tender Offer. The total number of Ordinary Shares and GDRs tendered in the Tender Offer represents in the aggregate 18.60% of MegaFon's outstanding Ordinary Shares as of 23 August 2018. MICL has accepted for purchase all validly tendered GDRs and Ordinary Shares subject to applicable settlement procedures set out in the Tender Offer Memorandum and related documents.

Under the terms and conditions of the Tender Offer Memorandum published by MICL, Securityholders who have submitted tenders for their Ordinary Shares (including Russian licensed securities trustees or foreign authorized holders, if applicable), their duly authorized nominee holders (whether Russian or foreign) or other representatives must, during the period commencing on 23 August 2018 and ending on 29 August 2018, inclusive, appear at the office of IRC to which such Securityholder or its representative originally submitted the Ordinary Shares Letter of Transmittal to sign documents required to transfer to MICL all Ordinary Shares indicated in the Ordinary Shares Letter of Transmittal, including the share purchase agreements.

Pursuant to the terms of the Tender Offer Memorandum and the relevant share purchase agreements, payments for Ordinary Shares will be made in Russian rubles at the Central Bank of Russia US$/RUB exchange rate in effect on 23 August 2018, the date of announcement of the results of the Tender Offer, of RUB 67.6163 per US$1.00, for a purchase price of RUB 659.26 (Six hundred fifty nine and 26/100) per one Ordinary Share. Payment for the GDRs tendered in the Tender Offer will be made in accordance with the procedures set forth in the Tender Offer Memorandum.

Pursuant to the resolution of the Board of Directors, as earlier announced at: https://corp.megafon.com/investors/news/capital_market_releases/20180716-0900.html, MegaFon will commence the process of cancelling the listing of its GDRs on the London Stock Exchange, and will make further announcements with respect to this matter as and when appropriate and as required under the FCA Listing Rules and applicable laws and regulations.

Settlements with respect to GDRs and Ordinary Shares accepted for purchase by MICL under the Tender Offer are expected to be completed on or about 24 August and 12 September 2018, respectively.

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Notes to Editors

MegaFon PJSC is a leading Russian integrated telecommunication service provider, operating in all segments of the telecommunications markets in Russia, and in the Republics of Abkhazia, South Ossetia and Tajikistan. MegaFon is a recognized market leader in the provision of mobile data services, was the first operator in Russia to launch commercial operation of a third generation (3G) network and was the first operator in the world to launch commercial operation of an LTE-Advanced (4G) data network. MegaFon is traded on the Moscow Exchange and the London Stock Exchange under the symbol MFON. Additional information about MegaFon and the products and services provided by MegaFon can be found at: http://www.megafon.ru

Cautionary Statement Regarding Forward Looking Statements

Some of the information in this document may contain or refer to projections or other forward-looking statements regarding future events or the future financial performance of the Company. You can identify forward looking statements by terms such as 'expect', 'believe', 'anticipate', 'estimate', 'forecast', 'intend', 'will', 'could', 'may', or 'might' the negative of such terms or other similar expressions. The Company wishes to caution you that these statements are only predictions, and are based upon various assumptions which are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control. We may not achieve or accomplish these plans or predictions. The Company does not necessarily intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of the Company, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, rapid technological and market change in the industries in which the Company operates, as well as many other risks specifically related to the Company and its business and operations.

Statement Regarding Inside Information

Some of the information in this document may be inside information. The subject matter, the identity of the issuer, the identity of the persons making the notification and their titles, and the date and time of the notification are all as set forth above.

Important Notice

NEITHER THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION ('SEC') NOR ANY U.S. STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED OF THE TENDER OFFER MEMORANDUM, PASSED UPON THE FAIRNESS OR MERITS OF THE TENDER OFFER OR DETERMINED WHETHER THE TENDER OFFER IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES.

THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT AND THE TENDER OFFER MEMORANDUM IS ADDRESSED EXCLUSIVELY TO THE HOLDERS OF ORDINARY SHARES OR GDRS OF PJSC 'MEGAFON'. NEITHER THE TENDER OFFER MEMORANDUM NOR THE TENDER OFFER DESCRIBED THEREIN NOR ANY INFORMATION CONTAINED THEREIN CONSTITUTE AN OFFER ('OFERTA') PURSUANT TO RUSSIAN LAW, OR AN ADVERTISEMENT, OR AN OFFER OF SECURITIES TO AN UNLIMITED NUMBER OF PERSONS WITHIN OR OUTSIDE THE TERRITORY OF THE RUSSIAN FEDERATION, OR A VOLUNTARY TENDER OFFER OR MANDATORY TENDER OFFER UNDER RUSSIAN LAW. NEITHER THE TENDER OFFER MEMORANDUM NOR THE TENDER OFFER DESCRIBED THEREIN CONSTITUTE OR ARE INTENDED FOR PLACEMENT OR PUBLIC CIRCULATION OF SECURITIES OF FOREIGN ISSUERS IN THE RUSSIAN FEDERATION. GDRS OF PJSC 'MEGAFON', TO WHICH THE TENDER OFFER RELATES, ARE NEITHER REGISTERED IN THE RUSSIAN FEDERATION NOR ADMITTED TO PLACEMENT, PUBLIC PLACEMENT OR PUBLIC CIRCULATION IN THE RUSSIAN FEDERATION IN ACCORDANCE WITH ARTICLE 51.1 OF RUSSIAN FEDERAL LAW DATED 22 APRIL 1996 NO. 39‑FZ 'ON THE SECURITIES MARKET' (AS AMENDED). THE TENDER AND PURCHASE OF GDRs OF PJSC 'MEGAFON' WILL BE CARRIED OUT EXCLUSIVELY IN ACCORDANCE WITH THE PROCEDURES SET FORTH IN THE TENDER OFFER MEMORANDUM. ANY INFORMATION IN THIS ANNOUNCEMENT AND RELATED DOCUMENTS IN RESPECT OF GLOBAL DEPOSITARY RECEIPTS REPRESENTING THE ORDINARY SHARES OF PJSC 'MEGAFON' IS ADDRESSED IN THE RUSSIAN FEDERATION SOLELY TO PERSONS WHO ARE 'QUALIFIED INVESTORS' AS DEFINED IN THE RUSSIAN FEDERAL LAW DATED 22 APRIL 1996 NO. 39‑FZ 'ON THE SECURITIES MARKET' (AS AMENDED).

THE TENDER OFFER IS BEING MADE TO SHAREHOLDERS OF PJSC 'MEGAFON' RESIDENT IN THE UNITED STATES IN RELIANCE ON, AND COMPLIANCE WITH, SECTION 14(E) OF THE EXCHANGE ACT AND REGULATION 14E THEREUNDER TO THE EXTENT APPLICABLE. THE TENDER OFFER IS BEING MADE IN THE UNITED STATES BY MEGAFON INVESTMENTS (CYPRUS) LIMITED AND NO ONE ELSE.

THE RELEASE, PUBLICATION OR DISTRIBUTION OF THIS ANNOUNCEMENT IN JURISDICTIONS MAY BE RESTRICTED BY LAW AND THEREFORE PERSONS SHOULD INFORM THEMSELVES ABOUT THE LAWS OF THEIR JURISDICTION, AND OBSERVE ANY APPLICABLE REQUIREMENTS.

IN ACCORDANCE WITH RUSSIAN LAW AND PURSUANT TO RULE 14E-5 OF THE U.S. SECURITIES EXCHANGE ACT OF 1934 (THE 'EXCHANGE ACT'), AFFILIATES OF PJSC 'MEGAFON' THAT ARE NOT MEMBERS OF THE MEGAFON CONSOLIDATED GROUP AND OVER WHICH PJSC 'MEGAFON' DOES NOT EXERCISE CONTROL AND THEIR RESPECTIVE NOMINEES OR BROKERS (ACTING AS AGENTS), AND ANY ADVISOR TO PJSC 'MEGAFON' OR ANY OF ITS AFFILIATES AND ANY DEALER MANAGER IN THE TENDER OFFER OR ANY OF ITS AFFILIATES, AND ANY PERSON ACTING, DIRECTLY OR INDIRECTLY, IN CONCERT WITH ANY SUCH PERSONS, MAY FROM TIME TO TIME MAKE PURCHASES OF, OR ARRANGEMENTS TO PURCHASE, SECURITIES OTHER THAN PURSUANT TO THE TENDER OFFER, BEFORE OR DURING THE PERIOD IN WHICH THE TENDER OFFER IS OPEN FOR SUBMISSION OF TENDERS, SO LONG AS THOSE ACQUISITIONS OR ARRANGEMENTS COMPLY WITH APPLICABLE RUSSIAN LAW AND THE PROVISIONS OF AN EXCEPTION PROVIDED UNDER RULE 14E-5 OF THE EXCHANGE ACT. ANY OF THE PURCHASES REFERRED TO IN THIS PARAGRAPH MAY OCCUR EITHER IN THE OPEN MARKET AT PREVAILING PRICES OR IN PRIVATE TRANSACTIONS AT NEGOTIATED PRICES. INFORMATION ABOUT SUCH PURCHASES WILL BE DISCLOSED AS AND IF REQUIRED BY APPLICABLE SECURITIES LAWS. THE TENDER OFFER IS BEING MADE FOR THE SECURITIES OF A RUSSIAN COMPANY AND APPLICABLE DISCLOSURE REQUIREMENTS MAY BE DIFFERENT FROM U.S. DISCLOSURE REQUIREMENTS. IN ADDITION, U.S. INVESTORS SHOULD BE AWARE THAT THE TENDER OFFER MEMORANDUM HAS BEEN PREPARED IN A FORMAT AND STYLE, WHICH DIFFER FROM THE U.S. FORMAT AND STYLE. NEITHER THE SEC NOR ANY U.S. STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE TENDER OFFER OR PASSED UPON THE ADEQUACY OR COMPLETENESS OF THIS NOTICE OR ANY DOCUMENTATION RELATING TO THE TENDER OFFER. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE.

FURTHERMORE, THE PAYMENT AND SETTLEMENT PROCEDURE WITH RESPECT TO THE TENDER OFFER FOR ORDINARY SHARES DIFFERS FROM U.S. PAYMENT AND SETTLEMENT PROCEDURES, PARTICULARLY WITH REGARD TO THE DATE OF PAYMENT OF CONSIDERATION.

THIS ANNOUNCEMENT, AND ANY INVESTMENT ACTIVITY TO WHICH IT RELATES, IS AVAILABLE ONLY TO (I) PERSONS WHO ARE OUTSIDE THE UNITED KINGDOM, (II) INVESTMENT PROFESSIONALS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE 'ORDER'), (III) HIGH NET WORTH COMPANIES FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER, (IV) PERSONS WITHIN THE SCOPE OF ARTICLE 43 OF THE ORDER, OR (V) ANY OTHER PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE MADE UNDER THE ORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS 'RELEVANT PERSONS'). THIS ANNOUNCEMENT MAY NOT BE ACTED OR RELIED ON IN THE UNITED KINGDOM BY ANYONE WHO IS NOT A RELEVANT PERSON.