City Service has signed a tentative agreement concerning the acquisition of a group of private companies in the city of Stavropol, Russia. Together these companies manage about 2 million square meters of space in residential buildings in Stavropol. ‘We choose the companies that we plan to acquire very carefully. After the tentative agreement is signed, we will take a couple of months to evaluate the credibility and the potential of the companies and then we will make the final decision concerning the acquisition,' Žilvinas Lapinskas, general manager of AB City Service said. It is planned to acquire the group of companies for 68.5 million RUB (5.6 million LTL). Their consolidated sales amount to 262 million RUB (not including VAT), (21.4 million LTL) a year. City Service would take over 100% of the shares in most of the companies which it is planning to purchase. In a few companies, City Service would take over 76% of the shares and the remaining 24% of the shares would be controlled by the administration of Stavropol. According to the representatives of City Service, this division of shares is seen as positive because it opens new opportunities for implementation of various projects together with the authorities of Stavropol. ‘The agreement for the acquisition of the companies in Stavropol is the first project created by the joint workgroup consisting of representatives from City Service and Sberbank,' Mr Lapinskas said. After City Service and Sberbank signed an agreement for cooperation at the beginning of the year, the workgroup was formed and tasked with preparing development projects for certain regions in Russia. Mr Lapinskas says that the first step will be made in Stavropol because it is a rapidly developing city. The city now has about 370,000 inhabitants. Various industries exist in Stavropol, for example, machinery and metalwork (there is a division of Kamaz in the city), electronics, chemical, oil and gas, and food. The reform of communal services market in Russia that opened the market for private companies engaged in the management of apartment buildings began in 2005. The total area of residential buildings in Russia amounts to more than 3 billion sq. m. About the companies City Service owns 33 companies operating in Lithuania, Latvia, Russia and Ukraine. City Service manages facilities in buildings the total area of which is nearly 18 million sq. m. The shares of City Service are listed on the Main List of NASDAQ OMX Vilnius stock exchange. Sberbank is the largest bank in Russia with 17 regional offices, 783 branches, and more than 20,000 sub-branches. Sixty percent of the banks' shares are owned by the Central Bank of Russia. Vilius Mackonis Public Relations Officer +370 5 2394900