Thursday,
24 August 2017
Our Community

Telenor's legal battles in Russia and Ukraine

Norway`s Telenor...

Norway`s Telenor (TEL.OL) and Russian partner Alfa Group have agreed to merge their Russian and Ukrainian holdings into a New-York listed mobile operator worth over $23 billion, ending one of the longest ever Russian corporate wars, according to Reuters. [ID:nL5637811]

Below are details of Telenor`s legal battles:

* VIMPELCOM (VIP.N) CASE

* Ownership structure: Telenor (29.9 percent voting stock/33.6 percent common); Alfa Group (44.0 percent/37.0 percent); Farimex (0.002 percent, when it filed a suit against Telenor)

* British Virgin Islands-registered Farimex sued Telenor in a Siberian court, claiming the Norwegian company`s opposition to Vimpelcom`s purchase of Ukrainian mobile operator Ukrainian Radio Systems (URS) delayed the deal at a loss to Vimpelcom.

* Telenor says the Farimex suit must "go away" for the announced agreement with Alfa to proceed. It gave no indication of if or when Farimex could drop its case.

* Telenor disputes Farimex`s ability to claim the damages given its small shareholding in Vimpelcom. It believes Farimex is linked to Alfa Group, with which Telenor has had a long history of litigation. Alfa denies any links to Farimex.

* Norway owns a majority in Telenor, while Alfa Group is run by billionaire Mikhail Fridman, who has close links to the Kremlin.

* Norway has called the Telenor case its "top bilateral issue" with Russia. The merger annoucement comes days after Prime Minister Vladimir Putin met Telenor`s chief executive.

* Telenor says it opposed the 2005 purchase of URS because the Ukrainian company was overvalued, lacked prospects and the deal was not transparent. URS was ultimately bought by Vimpelcom but remained loss-making for the Russian group through 2008.

* Vimpelcom`s entry into Ukraine put it in direct competition with Kyivstar, majority-owned by Telenor.

* A court in Khanty-Mansiysk, Siberia, held Telenor liable for $2.8 billion but an appeals court overturned its ruling. After a retrial another Siberian court ruled in Farimex`s favour and ordered Telenor to pay Vimpelcom $1.7 billion.

* Telenor refused and the court seized its Vimpelcom shares, and bailiffs have been preparing to auction off the stake even as the Siberian court adjuorned the case until March 2010.

* In 2008, Telenor filed a suit in a U.S. district court to clarify potential links between Farimex and Alfa. If such links are proven, Telenor says, then the Russian cases must be dropped and Farimex`s suit be treated by a regular arbitration process like all other shareholder disputes.

KYIVSTAR CASE:

* Kyivstar is Ukraine`s largest mobile operator. Its shareholders are: Telenor (56.52 percent) and Alfa subsidiary Storm (43.48 percent)

* Telenor was forced to deconsolidate Kyivstar in 2007 due to "insufficient control" over the company. Storm had not attended shareholder meetings for years until 2009.

* Storm boycotted the Kyivstar meetings because of a Ukrainian court injunction against attending, which was triggered by a case brought by EC Venture, a Swiss company that sold its interest in Storm in 2004 and later sued Storm.

* In March 2009, a U.S. federal court in New York said four Alfa Group companies were in contempt of court for failing to obey U.S. arbitration court orders and said the EC Venture-Storm case was friendly collusive litigation.

* The court ordered Alfa to pay fines and secure the dismissal of EC Venture`s litigation and divest stakes in Kyivstar rivals. In April, the U.S. court lifted the fines, saying it had complied with its ruling.

* In May, Telenor said a Farimex complaint had triggered an anti-monopoly investigation for Kyivstar in Ukraine.

* Telenor said it does not expect the anti-monopoly office to block the Kyivstar-Vimpelcom merger.

If you notice a spelling error, please highlight it with your mouse and press Ctrl+Enter
Read also
loading...

Do you like the new site?
Leave your opinion