MOSCOW, RUSSIA - EQS - 10 January 2019 - Public Joint Stock Company "MegaFon"(MoEx: MFON), a pan-Russian operator of digital opportunities ("MegaFon" or the"Company"), announces that on 9 January 2019, the Company's Board of Directors(the "Board of Directors") considered and approved recommendations in respectof the mandatory tender offer (the "Mandatory Tender Offer") made by "MegaFonFinance" LLC ("MegaFon Finance") to acquire securities (ordinary registereduncertified shares) of MegaFon, in the amount of 131,212,843 shares of theCompany at a price of RUB 659.26 per one ordinary share (the "PurchasePrice").

As previouslyannounced: https://corp.megafon.com/press/news/20181227-1030.html, the Companyreceived the Mandatory Tender Offer on 27 December 2018, following theexpiration of the period for statutory review of the Mandatory Tender Offer bythe Bank of Russia. MegaFon Finance and its affiliate, LLC AF Telecom Holding,hold in aggregate 78.84% of the ordinary shares of the Company.  The Mandatory Tender Offer was made for131,212,843 ordinary shares of the Company held by the remaining shareholdersat the Purchase Price.

The Board ofDirectors considers that the Purchase Price is justified and complies with therequirements of Federal Law No. 208-FZ on Joint Stock Companies dated26 December 1995, as amended (the "JSC Law"). In particular, in reviewingthe Purchase Price, the Board of Directors considered, among other things, thefact that the Purchase Price exceeds the average weighted price of one ordinaryshare of the Company on Moscow Exchange over a period of six months precedingthe date of filing of the Mandatory Tender Offer with the Bank of Russia whichaccording to the information provided by Moscow Exchange was RUB 570.50per one ordinary share; and that, pursuant to the information contained in theMandatory Tender Offer document, the Purchase Price corresponds to the maximumprice at which MegaFon Finance or its affiliates acquired or assumed anobligation to acquire the ordinary shares of the Company during a period ofsix months preceding the date of submission of the Mandatory Tender Offerto the Company.

The performance byMegaFon Finance of its obligation to pay for the purchased Shares is secured bya bank guarantee issued by Gazprombank (Joint Stock Company) in respect of thetotal amount of the purchase price, and if MegaFon Finance defaults on itsobligation to pay for the shares acquired pursuant to the Mandatory TenderOffer, the shareholders may demand payment under the bank guarantee.

Based on theinformation considered by it, including the information above, the Board ofDirectors recommended that the Company's shareholders accept the MandatoryTender Offer.

The Board ofDirectors draws the attention to the fact that the market price of the sharesof the Company may be subject to wide fluctuations in response to a number ofcircumstances, which are beyond the Company's control, including in response tomicro- and macro-economic factors, changes in the prices of the Company'sproducts and services rendered by the Company, changes in the profitability ofthe Company's business, estimates of analysts, amendments to applicablelegislation, decrease of the number of securities of the Company trading on theorganised securities markets as a result of the acquisition of shares pursuantto the Mandatory Tender Offer or other events or circumstances.

The Mandatory TenderOffer will remain open for 70 days from the date of receipt of the MandatoryTender Offer by the Company (i.e., from 28 December 2018 to 7 March 2019,inclusive). The Mandatory Tender Offer, including the recommendations of theBoard of Directors in respect of the Mandatory Tender Offer, will becommunicated to the shareholders of the Company to whom it is addressed,according to the procedure set forth by the JSC Law and the charter of theCompany for notifying of the general shareholders' meeting, i.e. by posting iton the Company's website at https://megafon.ru on the page used by the Companyfor the purposes of disclosure pursuant to the requirements of the Russianlegislation (https://corp.megafon.com/; https://corp.megafon.com/investors/;  https://corp.megafon.com/investors/stock_and_capital/mandatory_tender_offer/).

In accordance with the provisionsof the JSC Law the mandatory tender offer is made to the shareholders -- holdersof ordinary shares of the Company. The holders of Global Depositary Receiptsrepresenting the ordinary shares of the Company ("GDRs") should be able toparticipate in the Mandatory Tender Offer following the cancellation of theGDRs held by them, receipt of the respective number of the underlying ordinaryshares, and submission of the application to sell the securities (ordinaryshares) pursuant to the Mandatory Tender Offer, on the terms and conditions ofthe Mandatory Tender Offer and within the applicable deadlines.

Pursuant to the JSCLaw a shareholder has a right, but not an obligation, to accept the MandatoryTender Offer. Shareholders should make their own decision as to whether to selltheir shares pursuant to the Mandatory Tender Offer and, if so, how many sharesto sell. Prior to making any decision to sell their shares pursuant to theMandatory Tender Offer, the shareholders of MegaFon should carefully read andconsider the terms and conditions of the Mandatory Tender Offer and Articles84.2 and 84.3 of the JSC Law as well as the Information Letter in Relation tothe Mandatory Tender Offer and the recommended form of an application to sell ordinaryshares of PJSC "MegaFon" available on the MegaFon's website at https://corp.megafon.com/investors/stock_and_capital/mandatory_tender_offer/. Shareholders of MegaFon are urged to consult with their financialand tax adviser, and legal counsel if they have any questions in relation tothe Mandatory Tender Offer.

Important Information

This press release isnot for release, publication or distribution, in whole or in part, in, into orfrom any jurisdiction where to do so would constitute a violation of therelevant laws of that jurisdiction.

This press release isfor informational purposes and shall not constitute an offer to purchase or asolicitation of an offer to purchase with respect to any securities.   Any such offer or solicitation will be madeonly by means of the Mandatory Tender Offer document received by the Company.

The final terms of theMandatory Tender Offer are contained in the Mandatory Tender Offer documentreceived by the Company.  Investors andshareholders in MegaFon are strongly advised to read the Mandatory Tender Offerdocument and related materials as soon as they have been published, as thesewill contain important information.  Inconsidering the Mandatory Tender Offer, MegaFon security holders should relyonly on the information contained in the Mandatory Tender Offer document.

This announcement, andany investment activity to which it relates, is available only to (i) personswho are outside the United Kingdom, or (ii) investment professionals fallingwithin Article 19(5) of the Financial Services and Markets Act 2000 (FinancialPromotion) Order 2005 (the "Order"), (iii) high net worth companies fallingwithin Article 49(2) (a) to (d) of the Order, or (iv) persons within the scopeof Article 43 of the Order, or (v) any other persons to whom it may otherwisebe lawfully mad under the Order (all such persons together being referred to as"relevant persons"). Any investment activity to which this announcement relateswill only be available to and will only be engaged with, the relevant persons.Any person who is not a relevant person should not act or rely on this documentor any of its contents.

MegaFon is a companyorganised under the laws of the Russian Federation.  The Mandatory Tender Offer is made solelypursuant to Russian law. The Mandatory Tender Offer is not made or intended tobe made pursuant to the provisions of any other law. The Mandatory Tender Offerwill be subject to disclosure and procedural requirements of Russia which aredifferent from those of the United States.

The release,publication or distribution of this press release and any other documentationrelating to the Mandatory Tender Offer in jurisdictions other than Russia, theUK or the US may be affected by the laws or regulations of relevantjurisdictions. Any persons who are subject to the laws and regulations of anyjurisdiction other than Russia, the UK or the US should inform themselves ofand observe any applicable requirements.

Cautionary Statement Regarding ForwardLooking Statements

Some of the informationin this press release may contain or refer to projections or otherforward-looking statements regarding future events or the future financialperformance of the Company.  You canidentify forward looking statements by terms such as "expect", "believe","anticipate", "estimate", "forecast", "intend", "will", "could", "may", or"might", including the negative form of such verbs or other similarexpressions.  These statements arepredictions, and are based upon various assumptions which are inherentlysubject to significant uncertainties and contingencies which are difficult orimpossible to predict and are beyond control of the Company.  These plans or predictions may fail to beachieved or accomplished.  The Companydoes not necessarily intend to update these statements to reflect events andcircumstances occurring after the date of this press release or to reflect theoccurrence of unanticipated events.  Manyfactors could cause the actual results to differ materially from thosecontained in projections or forward-looking statements of the Company, including,among others, general economic conditions, the competitive environment, risksassociated with operating in Russia, rapid technological and market change inthe industries in which the Company operates, as well as many other risksspecifically related to the Company and its business and operations.