London’s High Court of Justice rejected Telenor’s application that could have delayed VimpelCom Ltd’s EGM, scheduled for March 17, to approve the proposed merger with Wind Telecom, Altimo said in a release.
This is a blow for the Norwegian company which…
London’s High Court of Justice rejected Telenor’s application that could have delayed VimpelCom Ltd’s EGM, scheduled for March 17, to approve the proposed merger with Wind Telecom, Altimo said in a release.
This is a blow for the Norwegian company which had petitioned the court for interim injunctive relief to prevent the EGM from approving the issue of shares to Wind shareholders unless it was also issued with pre-emptive rights shares at the same time.
Telenor was asking for new shares of VimpelCom to be issued and placed into escrow until arbitration proceedings are completed, and if the arbitration tribunal agreed that the Wind Telecom was not a related M&A transaction, the shares would be released to Telenor and the purchase price released to VimpelCom.
VimpelCom argued that the merger should be considered as a related party transaction and therefore was not subject to pre-emptive rights because a subsidiary of Alfa Group already owned shares in Orascom, meaning that existing shareholders cannot buy into new share issues.
VimpelCom, Altimo and Weather Investment have agreed to give certain undertakings to the Court in order to ensure that Telenor will receive its pre-emptive shares should the arbitration tribunal ultimately find in Telenor’s favour and protect Telenor’s stake from dilution below 25% plus one share between the closing of the transaction and the resolution of the arbitration proceeding, VimpelCom said in a release.
Telenor started arbitration proceedings to protect its pre-emptive right on January 28.