Vimpelcom sets aside USD900m amid Uzbek bribery probe; move follows ousting of Telenor chairman

3 Nov 2015

Russian-controlled, Amsterdam-based telecoms group Vimpelcom Ltd has announced that it will make a provision of USD900 million in its third quarter financial statements based on its ongoing assessment of investigations relating to the group’s business in Uzbekistan and its prior dealings with Takilant Ltd, a former Uzbek investment partner registered in Gibraltar. As the group announced in February 2015, it has been exploring the resolution of potential liabilities whilst it continues to cooperate with the investigating authorities including the US Securities & Exchange Commission (SEC), the US Department of Justice (DOJ) and the Dutch Public Prosecution Service (Openbaar Ministerie, OM).

Also today, Vimpelcom’s second-largest shareholder Telenor of Norway voiced its concerns over the USD900 million set-aside, in a statement reading: ‘Telenor Group sees Vimpelcom’s announcement today as a serious development that significantly increases our concerns in relation to the potential outcome of the still ongoing investigations.’ Last week, the Norwegian government – which owns 54% of Telenor – ousted Telenor’s chairman Svein Aaser after Norway’s Minister of Industry Monica Maeland expressed a lack of confidence in Aaser’s leadership because of ‘the [Telenor] board’s handling of the so-called Vimpelcom case’ having ‘received new information’. International authorities are known to have probed the role of Gulnara Karimova, daughter of Uzbekistan’s president, in the awarding of telecoms contracts and bribery allegations, although Maeland added that: ‘For the sake of the investigation, I cannot yet say more about the new information we have received.’

Earlier this month Telenor announced it was putting up for sale its 33%/43% equity/voting stake in Vimpelcom, in which Russian billionaire Mikhail Fridman’s investment fund LetterOne (formerly Altimo) owns the dominant 56.2% equity/47.9% voting share.

Russia, Telenor Group, VEON