Russia’s antitrust authority, the FAS, has filed a court claim against Telenor and Naguib Sawiris’s Weather Investments regarding their stakes in Vimpelcom.
Essentially the claim alleges Telenor’s February purchase of Vimpelcom shares from…
Russia’s antitrust authority, the FAS, has filed a court claim against Telenor and Naguib Sawiris’s Weather Investments regarding their stakes in Vimpelcom.
Essentially the claim alleges Telenor’s February purchase of Vimpelcom shares from Weather was illegal, Telenor said in a statement. FAS has asked the Moscow Arbitzrah Court – the city’s main commercial court – to order Telenor and fellow shareholders Weather and Altimo, the investment arm of Russia’s Alfa Group, to draw up an agreement similar to the one terminated late last year.
Telenor said that, while it has not received formal notification of the claim, it understands the FAS has alleged the share purchase and option transfer agreements it and Weather entered into on 15 February violated Russian Strategic Investment Law. On that date, Telenor bought 234 million Vimpelcom preferred shares from Weather for US$374.4m, thereby increasing its voting share to 36.36%.
According to the statement, the FAS has asked the court to invalidate the transactions, order Telenor to return the Vimpelcom shares it acquired from Weather and direct Telenor, Weather and Altimo to form a new shareholders’ agreement with “substantially the same terms” as the one terminated last year.
Telenor said the FAS has also asked the court to grant an injunction that would essentially prevent Telenor from making changes to Vimpelcom’s corportate governance bodies before the case is decided.
Vimpelcom shareholders have long disputed the company’s ownership and governance.
Following the termination of the shareholders’ agreement, Telenor has twice upped its stake in the company, which is now based in Amsterdam, and said it also plans to increase its representation on the board.
Telenor further boosted its stake in Vimpelcom in mid April in a US$715m deal with JP Morgan Securities which saw it increase its financial interest from 31.67% to 35.66% and its voting interest from 36.36% to 39.51%.
A Telenor spokesperson said in the statement the company believes it has complied fully with Russian Strategic Investment Law.
“In addition, we have provided the FAS with all of the information it has requested,” he said. “There has not been any change of control in VimpelCom, nor is there any agreement between Telenor and Weather Investments concerning control of VimpelCom. We are open to a dialogue with the FAS, but we will defend Telenor’s position using all available remedies under applicable law and treaties.”
The spokesperson added that the 15 February transaction “reestablished the balance of shareholder interest which existed before Telenor’s ownership was diluted as a result of the Wind Telecom transaction”.
Weather acquired its stake in Vimpelcom following the latter’s April 2011 merger with Wind Telecom.
