Telenor was today cleared to proceed with a merger of Vimpelcom and Kyivstar, after a minor shareholder dropped legal action against the Norwegian telco.
A Russian district court has overturned a ruling that made Telenor liable for $1.73 billion (€1.2 billion) in damages to Farimex Products, after the firm withdrew a claim against Telenor East Investment and other defendants in the case.
The ruling leaves Telenor clear to proceed with a merger of Vimpelcom with Kyivstar, after previous court rulings stated the tie-up could only proceed if the Farimex case was completely dismissed.
Farimex had claimed Telenor’s management delayed Vimpelcom’s takeover of mobile carrier URS, and sued the Norwegian firm for $5.6 billion, despite holding a stake of just 0.002% in Vimpelcom
Although the ruling clears the path for Vimpelcom to merge with Kyivstar, Telenor EVP Jan Edvard Thygesen cautions that the decision could still be appealed. “Before closing can occur there are still enforcement proceedings to be withdrawn by the bailiff,” he notes.
However, he adds that Farimex’s decision and the overturning of the previous court ruling “are steps in the right direction.”
Vimpelcom CEO Alexander Izosimov says a strong response to a US share offer shows the firm’s shareholders “strongly back Vimpelcom Ltd’s strategy and the combination of OJSC Vimpelcom with Kyivstar.”
A further share offer in Russia is due to close April 21, he said.