PRESS RELEASE

PEREKRESTOK CHAIN TO OPEN BRANCHES IN SISTEMA-HALS SHOPPING CENTRES

MOSCOW, RUSSIA - 30th May - Sistema-Hals OJSC, the largest diversified company on the Russian and CIS real estate market, and X5 Retail Group, Russia’s largest grocery retailer in terms of sales volumes, announced they have signed an agreement to open branches of the Perekrestok chain in Sistema-Hals retail & leisure centers.

They plan to open the Perekrestok stores in two retail & leisure centers in Moscow: Detsky Mir Central and Preobrazhensky, also in several regional Sistema-Hals complexes, including in the Hals Mart (Leto) regional mega-mall in St. Petersburg.

The cooperation agreement allows for both long leases (from 15 years) and purchase of selling space in the shopping centers.

“Sistema-Hals has adopted a broad strategic program of building shopping centers in Moscow and the regions. The synergy created by an alliance with a leading retail company will contribute to our dynamic development and regional focus, and enable us to plan our resources on a long-term basis”, said Sistema-Hals Vice-President Evgeny Kolodkin.

“Both sides will benefit from this strategic partnership agreement between the lead players in the development and grocery retail sectors. Our partners are interested in X5’s experience in grocery retailing and the wide regional spread and multi-format model of our business. We in turn will gain from Sistema-Hals’s experience and potential in the development business, which will enable us to speed up implementation of our ambitious plans to develop the chain in key regions of Russia”, stated X5 Retail Group’s Director of Development Andrey Rybakov.

About Sistema-Hals

OJSC Sistema-Hals is a major diversified company operating on the real estate markets of Russia and the CIS. The company's businesses are real estate development, project and construction management, asset management and facility management. It is a public company and its shares are traded on the London Stock Exchange, the Moscow Interbank Currency Exchange, and the Moscow Stock Exchange.

Sistema-Hals has built up a broad and well-balanced portfolio of assets in growing segments of the market. The company focuses on the construction of Class A and B offices, mixed-use complexes, business-class residential housing, single-family homes and land development.

Since its launch in 1994, Sistema-Hals has successfully completed more than 30 projects in Russia with a total area of more than 250 000 m2. These include the headquarters of DaimlerChrysler, the Hals-Tower office building, the headquarters of TMK, and a hotel for the MaMaison chain (Orco Property Group). Sistema-Hals is now building the Leningradsky Towers complex, which will consist of two buildings, one of which will become the headquarters of Siemens in Moscow. It is working on an integrated program for the redevelopment of properties belonging to the Moscow City Telephone Network (MGTS), the reconstruction of the Hotel Peking and a number of other projects.

As of 1 January 2007, the company Cushman & Wakefield valued Sistema-Hals' interest in the sites and projects within its portfolio at over $2 billion.

About X5 Retail Group N.V.

X5 Retail Group N.V. is Russia's largest food retailer in terms of sales. As of 31 March 2007, the Group had 512 company-managed "Pyaterochka"soft discount stores located in the Moscow (232), St. Petersburg (215) and other Russian areas (65), and 169 company-managed "Perekrestok" supermarkets across Central Russia and Ukraine, including 99 stores in Moscow.

As of 31 March 2007,franchisees operated 533 Pyaterochka branded stores across Russia and Kazakhstan. Perekrestokhad 10 stores operated by franchisees in the Moscow area.

Pyaterochkaand Perekrestok have merged their operations as of 18 May 2006 to create the clear leader in the Russian food retail market.

The Group’s audited pro forma net sales for the FY 2006 were US $3,551 million, up +50% vs. 2005. Pyaterochka chain provided US $1,973 million of net sales, the Perekrestok chain contributed US $1,496 million of net sales, and Merkado chain contributed US $ 82 million.

For further information, please contact:

Rania Efimova
PR director
Sistema-Hals
Tel. +7 (495) 785-7764
/ Anna Zavialova
PR manager
Sistema-Hals
Tel. +7 (495) 785-7764
/ Gennady Frolov
Communications director
X5 Retail Group
Tel. +7(495) 998-3335