12.12.2007    SITRONICS LAUNCHES PRODUCTION OF INTEGRATED CIRCUIT CHIPS

 MOSCOW, Russia - December 12, 2007 - JSC SITRONICS ("SITRONICS" or "The Company") (LSE: SITR), a leading provider of telecommunications, IT and microelectronic solutions in Russia and the CIS, today announced that it has launched production of 0.18 micron integrated circuit chips (IC) in Zelenograd. SITRONICS signed the partnership agreement with ST Microelectronics to cooperate in the field of design, marketing and selling of ICs in July 2006. SITRONICS invested more than US$ 300 million in the development of microelectronic production in Zelenograd over the last three years, including US$ 200 million investment in this project.

The new plant will use the integrated process of manufacturing ICs to produce a wide range of smart-cards. As previously announced SITRONICS plans to start the production of the next stage of ICs using 0.13 micron technology in the near future, this will be followed by the launch of 0.09 micron ICs in 2009.

SITRONICS is heading the creation of the "Moscow Technological Cluster" which is being formed around the modern production facilities in Zelenograd. The Cluster comprises modern production base, as well as scientific and technological laboratories, technical schools and service centres.

Sergey Aslanyan, President and Chief Executive Officer of SITRONICS, commented: "Microelectronic Solutions is one of the most dynamically developing segments of SITRONICS with an approximately 50% annual growth rate. The launch of the new plant will give us the opportunity to develop products using our own R&D resources and scientists. Mikron is a good example of the joint cooperation of private business and the government in bringing domestically developed microelectronic technologies to the market."

Gennady Krasnikov, General Director of JSC Mikron and Head of the SITRONICS Microelectronic Solutions, commented: "We have re-established the scientific and technological knowledge base at Mikron which will allow us to address the existing technological gap in the field of microelectronics in Russia. We have trained 120 engineers at our partners' companies, who are now involved in developing modern technologies in the country."

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For further information, please visit http://www.sitronics.com/ or contact:

 

Bree Schuette Tel: + 7 495 225 0030 Tel. + 7 916 550 1253 ir@sitronics.com schuette@sitronics.com                           Shared Value Limited                         Investor Relations                         Larisa Kogut-Millings                         Tel: +44 (0) 20 7321 5037                         sitronics@sharedvalue.net

SITRONICS is a leading provider of telecommunication solutions, including software, equipment and systems integration, IT solutions and microelectronic solutions in Russia and the Commonwealth of Independent States with a strong presence in Central and Eastern Europe and a growing presence in the Middle East and Africa.

SITRONICS serves over 3,500 clients, maintains offices in 32 countries and exports its products and services to more than 60 countries. SITRONICS has over 10,000 employees.

SITRONICS' key Telecommunication Solutions operations are based in Prague, Czech Republic and Athens, Greece and Moscow, Russia, while the company's IT Solutions and Microelectronic Solutions divisions are based in Kiev, Ukraine and Zelenograd, Russia, respectively.

SITRONICS generated revenues of US$ 1,014.6 million for the nine months ended September 30, 2007 and had total assets of US$ 1.78 billion at the end of the period. SITRONICS is majority-owned by Sistema, which is the largest diversified holding company in Russia and CIS.

SITRONICS has developed strategic alliances in its home markets with Cisco Systems, STMicroelectronics, Infineon and Giesecke & Devrient in relation to certain products and services.  SITRONICS has vendor relationships with Siemens, Ericsson, Motorola, ORACLE, Intel, Sun Microsystems and Microsoft.  Key customers include Sistema group companies, such as MTS, Comstar UTS and MTT, and also OTE, Cosmote, Vodafone, Ericsson and TCL.

Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of SITRONICS. You can identify forward-looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might" the negative of such terms or other similar expressions. These statements are only predictions and actual events or results may differ materially. We do not intend to or undertake any obligation 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 our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, and other factors specifically related to SITRONICS and its operations.

This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or other securities of SITRONICS, nor shall any part of it nor the fact of its distribution form part of or be relied on in connection with any contract or investment decision relating thereto, nor does it constitute a recommendation regarding the securities of SITRONICS.

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