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Telenor says its Vimpelcom stake seized

A Siberian court last month ruled in favour of tiny Vimpelcom shareholder Farimex, who said Telenor caused losses by delaying Vimpelcom’s entry into Ukraine and ordered the Norwegian group to pay $1.7 billion to Vimpelcom.

Telenor appealed the decision, rejected the fee and said it viewed the ruling as part of its long-running court and boardroom conflicts with Vimpelcom’s other main shareholder-Russian billionaire Mikhail Fridman’s Alfa Group.

‘This is a yet another escalation of the attempts to steal our Vimpelcom shares with the aid of Russian courts,’ Jan Edvard Thygesen, Executive Vice President and Head of Telenor’s Central and East European operations, said in a statement.

Telenor shares dived on the news and traded down 6.9 percent to 33.70 crowns at 1019 GMT, while the Dow Jones Telecom Index was off 0.8 percent.

Telenor said in other Russian lawsuits similar to the Farimex case ‘valuable assets have been auctioned off to obscure entities in non-transparent circumstances in exchange for unsecured promissory notes or other minimal consideration’.

Telenor has 29.9 percent of Vimpelcom’s voting stock and 33.6 percent of ordinary shares. Alfa Group has 44 percent of the voting shares and 37 percent of the common shares.

‘This is no longer just a dispute between two shareholders, but has entered a phase where illegal acts, supported by Russian courts, will affect Telenor’s shareholders directly and will seriously damage Russia’s reputation,’ Telenor said.

Vimpelcom spokeswoman Elena Prokhorova told Reuters by phone that her company was not involved in the case. ‘We are closely watching what is going on, but at the moment are not planning any actions on our own,’ she said.

Telenor said the Russian seizure came after a US federal court held Alfa Group in contempt for a second time in a case regarding Kyivstar-a Ukrainian mobile joint venture between Telenor and Alfa.

Telenor said the Federal Court for the Southern District of New York on March 11 granted Telenor’s motion requesting that Alfa Group companies be held in contempt of court for their failure to obey a US appeals court orders regarding Kyvistar.

The court ordered Alfa to pay fines of $100,000 per day, beginning on March 12 until it complies with the order, with the find doubling every 30 days until Alfa is no longer in contempt, Telenor said.