Re BoD decision to convene EGM and to delist GDRs

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Announcement by the Company regarding the decision by the Board of Directors to convene an Extraordinary General Meeting to approve the delisting of its Global Depositary Receipts ("GDRs") from the London Stock Exchange ("LSE") and the Astana International Exchange ("AIX") and the termination of the Company's GDR programme

Almaty, 24 February 2021 - Kcell Joint Stock Company ("Kcell" or the "Company") (LSE, KASE: KCEL; AIX: KCEL, KCEL.Y), the leading provider of mobile telecommunications services in Kazakhstan, today announces that at its meeting held on 23 February 2021, the Board of Directors approved a decision to convene an Extraordinary General Meeting of shareholders ("EGM") on 9 April 2021 to approve the cancellation of the listing of its Global Depositary Receipts ("GDRs") on the London Stock Exchange and the Astana International Exchange ("AIX") and to terminate the Company's GDR programme ("Proposals"). The Company's shares are intended to remain listed on the Kazakhstan Stock Exchange ("KASE").

Subject to the approval of the Proposals by the shareholders of the Company at the EGM (details of which, together with an explanatory circular, will be announced in due course), it is anticipated that, the Company will subsequently give notice to Deutsche Bank Trust Company Americas, acting as depositary of the GDRs, of the termination of the deposit agreement dated 23 October 2012 relating to the GDRs, and that the effective date of the cancellation of the GDR programme and of the listing of the GDRs on the LSE and the AIX will be on or around 7 July 2021.

The Board believes that the following factors are relevant when Shareholders and GDR Holders consider the Proposals:

●    Maintenance of the listing of the GDRs on the LSE and the AIX, along with the listing of the Company's common shares ("Shares") on the KASE results in low liquidity levels and fragmented trading patterns of the respective instruments in each of the three exchanges.

●    The Board believes that, by reducing the number of markets on which its securities are traded, and the resulting concentration of trading of the Shares on the KASE, will improve liquidity levels and trading patterns.

●    The volume of secondary trading in the GDRs observed on the LSE and the AIX is very low and, in the opinion of the Board, limits the potential for additional equity offerings by the Company. The Board is of the opinion that it would be very difficult for the Company to attract any meaningful equity investment in the future through its listing of GDRs. Furthermore, the Company does not have plans to access the international equity capital markets in the near future in view of the Company's funding strategy.

●    The Company's costs and management effort required to maintain the Company's status as an LSE and AIX listed company and maintenance of the GDR programme are not justified given the low liquidity of GDR trading on the LSE and AIX, and therefore exceed its benefits.

If the Proposals are approved at the EGM, the Company's shares will remain listed on the KASE. GDR holders will therefore have a choice of exiting their investment in the Company or exchanging their GDRs for shares in the Company traded on the KASE.

The Board approved the decision to convene the EGM on the initiative of the Company's majority shareholder. The Company's majority shareholder has indicated its initial interest in supporting the Proposals, subject to a formal decision of its governing bodies.   

Further details of the decision to convene the EGM to approve the Proposals will be set out in a circular to be made available in due course to all holders of GDRs on the website of the Company.

Further announcements will be made as appropriate.

This announcement contains inside information.

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 Company Overview

Kcell provides mobile voice telecommunications services, messaging services, value-added services such as multimedia and mobile content services, as well as data transmission services including internet access. It has two brands: the Kcell brand, which is targeted primarily at corporate subscribers (including government subscribers), and the Activ brand, which is targeted primarily at mass-market subscribers. The Company offers its services through its extensive, high quality network, which covers substantially all of the populated territory of Kazakhstan.

In December 2012, Kcell successfully completed its offering of GDR's on the London Stock Exchange and common shares on KASE. The price was set at USD 10.50 per GDR and KZT 1,578.68 per share with each GDR representing one share.  The offering consisted of 50 million shares, which represent 25 percent of Kcell's share capital.

On 21 December 2018, Kazakhtelecom JSC acquired the 75 percent stake in Kcell held by Telia Company and Fintur Holdings B.V.

Kcell plans to continue investing in the deployment of its 3G/4G network to expand coverage and to introduce high quality services. Kcell aims to provide high quality services at competitive prices, expand its offering of products and services, while maintaining the high quality of its network and enhancing its brand value.

Forward-looking statements

This document includes statements that are, or may be deemed to be, ''forward-looking statements''. These forward- looking statements can be identified by the use of forward-looking terminology including, but not limited to, the terms ''believes'', ''estimates'', ''anticipates'', ''expects'', ''intends'', ''may'', ''target'', ''will'', or ''should'' or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. They include, but are not limited to, statements regarding the Company's intentions, beliefs and statements of current expectations concerning, amongst other things, the Company's results of operations, financial condition, liquidity, prospects, growth, potential acquisitions, strategies and as to the industries in which the Company operates. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances that may or may not occur. Forward-looking statements are not guarantees of future performance and the actual results of the Company's operations, financial condition and liquidity and the development of the country and the industries in which the Company operates may differ materially from those described in, or suggested by, the forward-looking statements contained in this document. The Company does not intend, and does not assume any obligation, to update or revise any forward-looking statements or industry information set out in this document, whether as a result of new information, future events or otherwise. The Company does not make any representation, warranty or prediction that the results anticipated by such forward-looking statements will be achieved.