A Russian court has now lifted the freeze issued on Monday by the Omsk Arbitration Court on Altimo and Telenor’s shares in Vimpelcom, as reported in TeleGeography’s CommsUpdate earlier this week.
The legal wranglings were thought to stem from an earlier lawsuit filed by British Virgin Islands-registered company Farimex relating to Vimpelcom’s operations in Ukraine. In August the Khanty-Mansiysk Arbitration Court ruled that Telenor was liable to pay USD2.8 billion damages for delaying Vimpelcom’s entry into the Ukraine mobile market. Telenor then appealed that decision and the appeal is due in court on 18 November.
However, Telenor claimed the share freeze was not driven by the Fairmex dispute, but a tactical move orchestrated by Alfa Group, an investment company that owns Altimo, to prevent its 44% holding in Vimpelcom being seized by its creditor Deutsche Bank when shares pledged as collateral for a loan from the German finance house fell below the triggers for margin calls last Friday. Further developments seem to support this argument. Mikhail M. Fridman, the principal partner in Alfa Group has since been granted a USD2 billion letter of credit from the state development bank Vneshekonombank (VEB) as part of the government’s USD50 billion bailout program to help Russian industrialists refinance loans to western banks. The timings appear suspicious: by Tuesday, the loan guarantee was in place and on Wednesday the court released the shares.