MRSKH Executive Powers Transferred to FedGrid

IDGC Holding Executive Powers Transferred to Federal Grid

Moscow, 15 May 2012 - Federal Grid Company of Unified Energy System ("Federal Grid Company" or "the Company") (MICEX-RTS, LSE: FEES), announces that in accordance with the directive of the Government of the Russian Federation, the powers of the sole executive body of JSC IDGC Holding ("MRSK Holding") (MICEX-RTS: MRKH; LSE: MRSK) will be transferred to Federal Grid Company.

This is expected to support a unified approach to the implementation of the technical policies and management principles for Russia's electrical grid system, as well as to support coordinated work on development and modernization using innovative and high-technology solutions. Under unified management, the two entities are intended to implement unified investment, financial, economic and human resources policies. It is planned that this will help to maximize the human potential of the two companies while controlling costs. Common rules are expected to improve the reliability of electricity supply, as well as the transparency and efficiency of the technical connection of customers.

Establishing unified management standards should increase the independence and accountability of subsidiaries and affiliated companies, as well as establish a foundation for more efficient operations.

Combining the potential of the two companies is intended to accelerate the creation of a Network Code, which will govern the general principles and rules for businesses in the electricity sector.

Implementation of these measures is expected to increase the efficiency of the Russian power industry as a whole, and to have a positive impact on consumers.

In the near future this issue will be submitted for consideration to the management bodies of Federal Grid Company and IDC Holding.

All further organisational and corporate measures aimed at merging Federal Grid Company and IDGC Holding will be undertaken with consideration for the interests of all shareholders and investors of both companies.

Enquiries:

About Federal Grid Company

Federal Grid Company is the operator and manager of Russia's unified electricity transmission grid system, including high voltage transmission lines, and holds the status of a natural monopoly.

The Company's assets include over 124,000 km of transmission lines and 854 substations with over 322 GVA of 35-750 volt transformer capacity. Based on the length of transmission lines and installed transformer capacity, Federal Grid is the largest publicly traded electricity transmission company in the world.

Federal Grid's business is to provide electricity transmission and technological connection services. It maintains and develops the grid system and supervises grid facilities and infrastructure in 73 regions of Russia, covering a territory of 13.6 million square kilometres. Its customers are regional distribution companies, electricity suppliers and large industrial enterprises.

Since 1 January 2010, Federal Grid has operated under a 5-year regulatory asset base (RAB) model.

The Company was incorporated in June 2002 as part of reorganisation of Russia's electrical power industry. The largest shareholder, with a 79.55% stake, is the Russian Federation Government.

Federal Grid Company's ordinary shares are listed on the MICEX-RTS stock exchange under the ticker FEES and the Company's GDRs are traded on the London Stock Exchange under the same FEES symbol. The Company's shares are included in the MSCI Emerging Markets and MSCI Russia indices.

In 2011 the Company's IFRS revenue for 2011 was RUB 139,571 million (up 23% compared to 2010), adjusted EBITDA as RUB 83,760 million (a 24% increase from 2010), and adjusted net profit was RUB 38,241 million (up 37% on 2010).

Further information can be found at www.federal-grid.com