TNW Teleset Net

RNS Number:9419L
Teleset Networks PLC
13 November 2006



FOR IMMEDIATE RELEASE                                   MONDAY, 13 November 2006

                  Teleset Networks announces $17m acquisition

Teleset Networks ("Teleset" or "the Company"), a leading alternative fixed-line
telecom network operator in Kazan, the capital city of the Republic of
Tatarstan, Russia, announces the acquisition of TNPKO, Kazan's fourth largest
fixed-line telecom operator, for a cash consideration of $17 million.

The consideration has been financed from a $9.8 million new loan facility from a
Russian bank and from the Company's existing banking facilities.

Yiannis Demetriou, CEO of Teleset Networks, commented:

"The acquisition of TNPKO is the first major step by Teleset Networks in our
stated strategy of increasing network coverage in Kazan and expanding into other
cities in Russia. TNPKO is a profitable business which will significantly
strengthen our position in Kazan and create value for Teleset shareholders."

TNPKO operates a digital network in the Privolgsky and Sovetsky districts of
Kazan, where Teleset currently has no presence, where it has approximately
36,000 corporate and residential subscribers and approximately 150 employees.

For the 10 months to 31 October 2006, TNPKO's revenues were approximately $4.1
million (full year 2005: $3.8 million) on which profit before tax was
approaching $1 million (full year 2005: $0.9 million). Net assets at 31 October
2006 were approximately $7.7 million and the Company is not assuming any TNPKO
debt.

Following the acquisition of TNPKO, Teleset will have a total of approximately
112,000 subscribers in Kazan giving the Company a market share of around 27.5
per cent.

The integration of TNPKO into Teleset's operations and the application of
Teleset's management methods are expected to achieve a number of significant
benefits for the combined business including:

   * 100 per cent network coverage of Kazan districts
   * Strengthened engineering, sales and customer service capabilities

   * Increased average revenues per user through the sale of Teleset's
    value-added services to existing TNPKO subscribers

   * Enhanced position with regulators and business partners

   * Economies of scale and other synergies


The Company expects to complete the integration of TNPKO during the first half
of 2007.

ENDS



CONTACTS

Corporate Synergy - Nominated Adviser               +44 (0) 20 7448 4400
Brian Stockbridge or Jonathan Evans

Metropol (UK) Limited - Broker                      +44 (0) 20 7439 6880
Alexander Selegenev

Bankside - Financial PR                             +44 (0) 20 7367 8888
Simon Bloomfield or Samantha Kinghorn




                      This information is provided by RNS
            The company news service from the London Stock Exchange

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