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Alfa hits back at Telenor over Vimpelcom ownership
August 21, 2012 / 1:42 PM / 5 years ago

Alfa hits back at Telenor over Vimpelcom ownership

* Equal ownership seen a condition of truce

* Alfa says foreign investors have effective control

* Telenor claims Alfa controls more via tycoon Pinchuk stake

* Alfa denies Pinchuk affiliation

By Maria Kiselyova

MOSCOW, Aug 21 (Reuters) - Vimpelcom’s largest Russian shareholder Alfa on Tuesday rebutted the latest ownership comments by its Norwegian co-investor Telenor , as a seemingly intractable dispute between the two sides showed no sign of a quick solution.

Telenor had said on Monday that Alfa speaks for the biggest stake in Vimpelcom, but Alfa hit back, saying foreigners were the biggest holders - a key issue given Russian regulatory pressure for the two sides to have equal holdings.

The latest argument comes after a years-long wrangle over control and strategy at Vimpelcom, a dispute that has typified the challenges many overseas investors face in Russia’s oligarch-dominated business world.

In emailed comments on Tuesday, Altimo, a unit of billionaire Mikhail Fridman’s Alfa-Group, said Telenor - together with Norwegian state funds and Ukrainian tycoon Viktor Pinchuk’s EastOne company - controlled at least a combined 51 percent of Vimpelcom’s votes, against Altimo’s 40.5 percent.

Telenor had argued on Monday that a 6 percent stake held by EastOne should be counted as part of Altimo’s stake, saying the Russian partner therefore had effective control over more shares in Vimpelcom, which holds a quarter of Russia’s mobile market but earns the bulk of its revenue abroad.

“We flatly reject all accusations that ... EastOne nominally owns Vimpelcom shares in Altimo’s interests,” said Altimo Vice President Evgeny Dumalkin in the email. He added Altimo reserved the right to sue Telenor for this suggestion.

The dispute over which side has greater control of the telecoms operator has stalled the momentum of a Russian campaign for the pair to hold similar stakes. [ I D:nL6E8JG1H2]

Parity of ownership is seen as a precondition for withdrawal of a lawsuit by Russian regulator FAS. The suit challenges the dominant position of Telenor in Vimpelcom, whose Russian unit is Russia’s no.3 mobile phone operator and is considered by the Russian government a strategic asset.

Altimo raised its holding to 40.5 percent last Wednesday and urged Telenor to sell it some of its own Vimpelcom shares to achieve parity of ownership. Telenor’s stake is set to rise to 43 percent by October as a result of an options deal.

Telenor said on Monday it had no plans to sell any of its Vimpelcom shares.

Russia’s anti-monopoly regulator FAS filed a lawsuit in April seeking to overturn a February deal that increased Telenor’s stake to above Altimo‘s.

The withdrawal of the legal case would allow Vimpelcom to resume dividend payments, which it had deferred after a Russian court issued an injunction in April banning payouts by Vimpelcom’s Russian unit to its Netherlands-registered parent company.

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