RNS Number:9913Q

Chagala Group Limited09 February 2007

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE

UNITED STATES, CANADA, AUSTRALIA OR JAPAN

This announcement is an advertisement and not a prospectus. Investors should notpurchase or subscribe for any transferable securities referred to in thisannouncement except on the basis of information in the prospectus which isexpected to be published by Chagala Group Limited in due course in connectionwith the Offering. Copies of the prospectus, following publication, will beavailable from Chagala Group Limited's registered office.9 February 2007 Chagala Group Limited Announcement of Indicative Offer Price Range of US$7.75 to US$9.75 per GDR

Chagala Group Limited ("Chagala" or "the Company"), the leading real estatedeveloper in Western Kazakhstan, today announces the indicative price range forthe Offer of its Shares in the form of global depositary receipts (the "GDRs").

This follows the announcement of Chagala's intention to float on the main marketof the London Stock Exchange, made on 30 January 2007. The pathfinder prospectusin relation to the Offer will be made available to institutional investors andbookbuilding will commence today.

Summary of the Offer* Indicative price range of US$7.75 to US$9.75 per GDR, which implies a market capitalisation range of approximately US$165 million to US$207 million.* The Offer is expected to consist of the sale of up to 42,800,000 Ordinary Shares in the form of up to 10,700,000 global depositary receipts (the "GDRs"), representing approximately 50% of the Company's issued share capital, implying a total Offer size range of approximately US$83 million to US$105 million.* The offering includes an over-allotment option, granted by the selling shareholders to ING Bank, as sole Bookrunner, and exercisable for a period of up to 30 days from the announcement of the offer price, to purchase up to 1,605,000 GDRs.* Chagala intends to apply for admission of the GDRs to the Official List of the UK Financial Services Authority and to trading on the London Stock Exchange's main market for listed securities.* Announcement of the final Offer price and commencement of conditional dealings is expected to take place at 9.00 a.m. on or around 21 February 2007.* Admission of the Shares to listing on the Official List of the Financial Services Authority and commencement of unconditional dealings on the main market for listed securities of the London Stock Exchange plc (together, "Admission") is expected to take place at 9.00 a.m. on or around 27 February 2007.* ING Bank N.V., London Branch is acting as Global Co-ordinator and Bookrunner to the Company in connection with the Offering.

Commenting on today's announcement, Tim Abson, Executive Chief Executive,

Chagala Group Limited, said:"We are delighted that Chagala is taking the next step towards becoming a listedcompany and look forward to commencing our roadshow today.

We consider the IPO process to be an important new chapter in the history of

Chagala and we will be well positioned to benefit as a listed company from theprojected growth of the Kazakhstan's property market." - ends -

For further information please visit www.chagalagroup.com or contact:

Chagala Group Limited +7 (3272) 54 35 01

Tim Abson +7 (3272) 54 35 01

Bell Pottinger Corporate & Financial 020 7861 3232

Peter Otero 020 7861 3864

Victoria Geoghegan 020 7861 3925

Summary Information on Chagala* Chagala, formed in 1994, is the leading real estate developer in West Kazakhstan exploiting real estate development opportunities related to the emerging offshore oil and gas industry in the region.* The first facility was opened in 1995 in the city of Atyrau on the Caspian Sea and, to date, Atyrau has been the prime area of activity.* The Company is expanding in centres of oil and gas operations in West Kazakhstan namely: Atyrau, the administrative centre for Kazakhstan's oil & gas industry, Bautino, the supply base for the off-shore oil industry; Aktau, a major Kazakh sea port with oil-loading facilities; and Uralsk, the regional centre connected with the Karachaganak gas field, one of the biggest gas condensate fields in the world.* The diversified property portfolio includes: a chain of three star hotels catering to businessmen working in the rapidly expanding energy sector, fully-serviced, high quality apartments, a range of stand alone food and beverage outlets, Office buildings complying with international standards and a sizeable portfolio of land in strategic locations for future development* The Directors believe that the Group has excellent growth prospects operating in an area with continuing strong growth in demand for, and prices of, property in West Kazakhstan* Chagala has a high name recognition in the region as a quality brand and has a record of achieving consistently high occupancy rates from its property portfolio* The Group has ownership of a sizeable, diverse and well-located land bank acquired at competitive prices with excellent development potential* The management has a long and successful track record of developing real estate projects in the region and established entrepreneurial culture.

Important Information

In this announcement, unless the context otherwise requires, references to "CH

Group" are to Chagala Hotels LLP and its subsidiaries before the reorganisationin September 2006 as a result of which Chagala Group Limited became the holdingcompany of the Group (the "Reorganisation"). Unless the context otherwiserequires "Group" means the CH Group before the Reorganisation and Chagala Group

Limited and its subsidiaries following the Reorganisation.

The contents of this announcement, which have been prepared by and are the soleresponsibility of Chagala have been approved solely for the purposes of Section21 (2) (b) of the Financial Services and Markets Act 2000 ("FSMA") by ING Bank

N.V., London Branch, 60 London Wall, London EC2M 5TQ ("ING").

ING is acting for Chagala in relation to the Offering and no one else and willnot be responsible to anyone other than Chagala for providing the protectionsafforded to clients of ING, nor for providing advice in relation to the

Offering, the contents of this announcement or any transaction or mattersreferred to herein.

This announcement is not for publication or distribution, directly orindirectly, in, into or from the United States of America, Canada, Australia or

Japan. This announcement does not constitute or form part of any offer orinvitation to sell or issue or any solicitation of any offer to purchase orsubscribe for any securities in any jurisdiction, nor shall it (or any part ofit) or the fact of its distribution form the basis of, or be relied upon inconnection with, or act as any inducement to enter into, any contract orcommitment thereof.

Recipients of this announcement who intend to purchase or subscribe for GDRs inthe Company following publication of the final prospectus are reminded that anysuch purchase or subscription must only be made solely on the basis of theinformation contained in the prospectus relating to the Company in its finalform.

The shares mentioned herein have not been, and will not be, registered under the

US Securities Act of 1933, as amended (the "Securities Act"), and may not beoffered or sold in the United States or to or for the account or benefit of USpersons (as such term is defined in Regulation S under the Securities Act)absent registration or an exemption from registration. No public offer of theshares is being made in the United States and the information contained hereindoes not constitute an offering of securities for sale in the United States,

Canada, Australia or Japan. No money, securities or other consideration is beingsolicited and, if sent in response to the information contained herein, will notbe accepted.

The distribution of the documents or other information contained herein and the

Offering may be restricted by law in certain jurisdictions. No action has beentaken by Chagala or ING that would permit an offer of any of the GDRs orpossession or distribution of any of the documents or other informationcontained herein or any other Offering or publicity material relating to the

GDRs in any jurisdiction where action for that purpose is required, other thanto certain investors in the United Kingdom. Persons into whose possession any ofthe documents or other information contained herein comes are required by

Chagala to inform themselves about and to observe any such restrictions. Anyfailure to comply with these restrictions may constitute a violation of thesecurities laws of any such jurisdiction.

Some of the statements made herein may include forward-looking statements whichreflect Chagala's or, as appropriate, its directors' current views with respectto financial performance and business strategy and plans and objectives ofmanagement for future operations (including development plans relating to the

Group's properties and services). These statements include forward-lookingstatements both with respect to the Group and the sectors and industries inwhich the Group operates.

All forward-looking statements address matters that involve risks anduncertainties. Accordingly, there are or will be important factors that couldcause the Group's actual results to differ materially from those indicated inthese statements. Any forward-looking statements in this document reflect

Chagala's current views with respect to future events and are subject to theseand other risks, uncertainties and assumptions relating to Group's operations,results of operations, growth strategy and liquidity.

Forward-looking statements may and often do differ materially from actualresults. These forward-looking statements speak only as of the date of thisannouncement. Subject to any obligations under the prospectus rules, listingrules and disclosure rules made by the Financial Services Authority under Part

VI of FSMA, and save as required by law, Chagala undertakes no obligation topublicly update or review any forward-looking statement, whether as a result ofnew information, future developments or otherwise. All subsequent written andoral forward-looking statements attributable to Chagala, or individuals actingon behalf of Chagala, are expressly qualified in their entirety by thisparagraph. This information is provided by RNS The company news service from the London Stock Exchange

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