X5 COMPLETES ACQUISITION OF OSTROV

X5 RETAIL GROUP COMPLETES ACQUISITION OF ostrov RETAIL CHAIN

Amsterdam, 29 September 2010- X5 Retail Group N.V., Russia's largest retailer in terms of sales (LSE ticker: "FIVE"), announces today that it has completed the acquisition of 100% equity interest in ZAO "Ostrov-Invest", which operates stores in Moscow and the Moscow Region under the "Ostrov" brand.

Established in 1995, "Ostrov" retail chain had H1 2010 revenue of RUR 1.5 bln. (incl. VAT). X5 Retail Group has acquired 16 stores in Moscow and the Moscow region with a selling area of 12.3 thousand sq.m. for a total consideration of USD 38 million, including debt. X5 plans to convert approximately half of "Ostrov" stores into supermarkets and the rest to discounters.

X5 received all necessary approvals for the transaction, including an unconditional consent from the Russian Federal Anti-Monopoly Service (FAS).

Note to Editors:

X5 Retail Group N.V. is Russia's largest retailer in terms of sales. The Company was created as a result of a merger between Pyaterochka (soft discounter chain) and Perekrestok (supermarket chain) on 18 May 2006. In June 2008, X5 acquired Karusel hypermarket chain and substantially strengthened its position in hypermarket format.

As at 30 June 2010, X5 had 1,514 Company-managed stores located in Moscow, St. Petersburg and other regions of European Russia, Urals and Ukraine, including 1,135 soft discount stores, 275 supermarkets, 62 hypermarkets and 42 convenience stores.

As at 30 June 2010, X5's franchisees operated 610 stores across Russia.

For the full year 2009 X5's net sales totaled USD 8,717 mln, EBITDA reached USD 736 mln, and net profit amounted to USD 165 mln.

For the first half 2010, net sales totaled USD 5,184 mln, EBITDA reached USD 399 mln, and net profit amounted to USD 104 mln.

X5 Shareholder structure is as follows: Alfa Group - 47.9%, founders of Pyaterochka - 23.1%, X5 Management - 1.9%, treasury shares - 0.1%, free float - 27.0%.

Forward looking statements:

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the fact that they do not only relate to historical or current events. Forward-looking statements often use words such as" anticipate", "target", "expect", "estimate", "intend", "expected", "plan", "goal" believe", or other words of similar meaning.

By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances, a number of which are beyond X5 Retail Group N.V.'s control. As a result, actual future results may differ materially from the plans, goals and expectations set out in these forward-looking statements.

Any forward-looking statements made by or on behalf of X5 Retail Group N.V. speak only as at the date of this announcement. Save as required by any applicable laws or regulations, X5 Retail Group N.V. undertakes no obligation publicly to release the results of any revisions to any forward-looking statements in this document that may occur due to any change in its expectations or to reflect events or circumstances after the date of this document.