Russian investor Mikhail Fridman’s investment firm Altimo has boosted its stake in VimpelCom from 41.85% to 47.85% – a move it contends will enable the mobile operator to resume business as usual and lead to a resolution of the dispute between fellow…
Russian investor Mikhail Fridman’s investment firm Altimo has boosted its stake in VimpelCom from 41.85% to 47.85% – a move it contends will enable the mobile operator to resume business as usual and lead to a resolution of the dispute between fellow major shareholder Telenor and the competition regulator.
Altimo agreed on 26 October to pay US$217.5m to acquire 123.6 million preferred shares from Pinchuk’s Bertofan Investments within 60 days, it disclosed in a filing to the US Securities and Exchange Commission.
Following the acquisition of the 6% stake Altimo is now the largest shareholder in VimpelCom, ahead of Telenor, which has a 43% voting stake.
The purchase will be funded with working capital and borrowings of US$740m pursuant to existing credit facilities set to mature in 2017, according to the filing.
A spokesperson for Altimo said the company is now satisfied with the ownership stakes in VimpelCom, adding that the deal frees up the Amsterdam-listed company, currently subject to numerous restrictions imposed by the Moscow Arbitration Court, to restore corporate governance, remove court claims, better service debt and resume dividend payments.
He added that Altimo hopes the acquisition will resolve the foreign ownership issues that prompted the Federal Antimonopoly Service (FAS) to file a lawsuit against Norway’s Telenor over its February stake increase in VimpelCom.
A spokesperson for Telenor said the company believes the deal supports its repeated contention that “the Bertofan stake was a mere parking of shares as a tool to annul the shareholders agreement between us”.
“We can only take note of the buyback and that Altimo remains in control of VimpelCom,” he said.
The shareholder agreement between Telenor and Altimo ended in February.
Telenor’s spokesperson added that the company expects the FAS to withdraw its lawsuit, which it contends is groundless.
The FAS was not immediately available for comment. However, the authority has said previously it hopes an out-of-court settlement can be reached ahead of a Moscow Arbitration Court hearing set to begin on 27 November.
In the meantime VimpelCom subsidiary OTH confirmed that it has launched a strategic review of its operations in Burundi, Zimbabwe and Central African Republic “Those strategic options include, but are not limited to, a sale of all or a material part of the Sub-Saharan African Operations either in one transaction or in a series of transactions” OTH said.
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