MTS also signed an option to buy the remaining 49% in BCTI for no more than $26.9 million in the next eight months, according to an MTS press release Monday.

As of Tuesday, BCTI, which is registered in the U.S. state of Texas, stopped providing mobile services in Turkmenistan, the press release said.

BCTI has a subscriber base of around 60,000 and a market share of 97% in Turkmenistan.

MTS is sure that the government of Turkmenistan has no legal grounds for removing the license and will take all necessary steps to ensure the restoration of its new subsidiary’s activities in supplying mobile services, the press release said.

“We are extremely surprised by the decision to remove the license, which we see as the result of a misunderstanding, especially considering a number of attempts made by MTS to explain to representatives of the Turkmen government the details of the deal (in buying 51% in BCTI),” MTS President Vasily Sidorov said, as quoted in the press release.

Sidorov added in the press release that all of Barash Communications Technologies’ subscribers are now unable to make or receive calls.

“At the moment 60,000 subscribers are unable to make local or long-distance calls. We are sure of a quick solution to the problem, which will allow us to realize our plans on investment and the improvement of the telecommunications infrastructure of Turkmenistan,” he said.

In 2004 BCTI's revenue totaled $12 million, and average monthly revenue per user (ARPU) for 2004 amounted to approximately $31. The company’s network uses equipment produced by Germany’s Siemens.

MTS is the largest mobile operator in Russia and Central and Eastern Europe and is licensed to provide services over an area with a total population of 225.8 million people. MTS provides mobile phone services in 76 of Russia’s 89 regions.

MTS’ total subscriber base amounted to 42.32 million users as of May 31, the company said earlier.

The company’s main shareholders are Russian holding AFK Sistema with 50.4% and Germany’s telecom company Deutsche Telekom with 10.1%, according to MTS’ website.

© "Prime-TASS"