Telenor: Vimpelcom deal was ‘illegal’; new shareholder ‘interested’ in keeping 6% stake

8 Nov 2011

Norwegian telecoms giant Telenor has claimed that the June sale of Vimpelcom preferred shares to a Cyprus-based company owned by Alfa Group founder Oleg Kiselev was illegal. According to Total Telecom, the claim forms part of Telenor’s suit against Alfa Group-owned Altimo, its fellow stakeholder in Vimpelcom. As previously reported by TeleGeography’s CommsUpdate, the shareholders agreement between Telenor and Altimo included a clause stipulating that both sides had to retain a 25% stake or higher for the agreement to remain valid. Altimo’s sale of a 6% stake took its holding slightly below that level, effectively cancelling the agreement with its Norwegian partner. Following the sale, Altimo is not permitted to increase its stake in Vimpelcom for at least twelve months. In April 2011 Altimo said it wanted to give Egyptian telecoms entrepreneur – and new Vimpelcom shareholder – Naguib Sawiris a seat on Vimpelcom’s board, a move that required an end to the deal with Telenor. The admission was made just hours after Vimpelcom completed its long-running USD6.5 billion merger with the telecoms assets of Sawiris, which was strongly opposed by Telenor. Despite Telenor’s claims, Altimo continues to deny any connection to Kiselev. For his part, the Russian businessman has indicated that he is ‘interested’ in holding on to his controversial stake.