Altimo looking for rapid Telenor agreement to end VimpelCom Orascom Wind impasse
Altimo, the telecoms arm of the Alfa-Group, plans to push ahead with a cash-and-share merger between VimpelCom and Wind Telecom, which belongs to Egyptian tycoon Naguib Sawiris, but Telenor fears that a new share issue, needed to facilitate the deal, will dilute its stake in VimpelCom to 25% from 36.03% as it cannot exercise preemptive rights. Under the proposal Altimo's stake will be diluted to 31% from 44.65%.
In January, Telenor filed a suit to the Commercial Court of London to prove it had preemptive rights and asked the court to put an injunction on VimpelCom shares before a court decision is taken. Altimo said in a statement that it and VimpelCom had suggested solving the issue before March 7 using accelerated legal proceedings.
A source close to VimpelCom shareholders told Russian news agency, RIA Novosti, that Altimo had promised Telenor that it would not use VimpelCom shares for mergers and acquisitions which could dilute Telenor's holding if it withdrew it request of injunction. Altimo also promised an extraordinary shareholders' meeting to vote for issuing more shares for Telenor if it rejected the injunction.
But Telenor has said it was not going to dump injunctions measures in its suit, with Telenor spokeswoman Anna Ivanova-Galitsyna emphasizing the move is outside the Vimpelcom shareholders agreement negotiated between Altimo and Telenor to end a previous dispute between the VimpleCom shareholders.
"We believe that Altimo's proposal is not consistent with VimpelCom's shareholders' agreement, it cannot be guaranteed and does not protect Telenor's interests as VimpelCom's shareholder."
"This is why Telenor will continue protecting its rights in the Commercial Court of London and in the Arbitration court."
VimpelCom will hold a shareholders' meeting on March 17, where minority shareholders will, in fact, decide on the fate of the deal.