* Rosneft filed lawsuit against Sistema on Tuesday
* Says assets removed from Bashneft when Sistema owned it
* Sistema says hasn’t seen court papers so can’t comment
* Russian state seized Sistema’s Bashneft stake in 2014 (Writes through with new quotes, detail)
MOSCOW, May 3 (Reuters) - Russian business conglomerate Sistema lost over a third of its market value on Wednesday after oil major Rosneft filed a lawsuit against the company for $1.9 billion.
The lawsuit rekindled investor fears from 2014, when the Russian government seized Sistema’s stake in oil firm Bashneft , saying Bashneft’s privatisation had been illegal.
Rosneft, which bought Bashneft from the state last year, said it was suing Sistema because assets were removed from Bashneft when it was owned by Sistema.
Sistema said it could not comment because it had not seen the court documents submitted by Rosneft and Bashneft in a Moscow court on Tuesday.
Sistema’s Moscow-listed shares were down 37 percent at 1450 GMT, while its $500 million bond maturing in 2019 had fallen more than 3 cents to 104 cents, according to Tradeweb data.
Back in 2014, the bond plunged to as low as 46 cents. .
“Sistema rattled the market back in 2014,” said Joseph Dayan, head of markets at BCS Global Markets in London. “The understanding was this dispute was a couple of years old so it’s a surprise that it’s come up again and in terms of the size of the claim too it’s out of proportion to what we were expecting.”
The lawsuit soured the mood on the Russian stock market.
The dollar-denominated RTS index fell 2 percent to 1,097 points, while the rouble-based MICEX was 1.5 percent lower at 1,995 points.
VTB Capital analysts said the size of the lawsuit was equivalent to 46 percent of Sistema’s market capitalisation based on its global depository receipts (GDRs).
Shares in Sistema-owned telecoms firm MTS fell more than 10 percent on speculation Sistema could have to increase its debt burden or seek funds from MTS if it loses the lawsuit to Rosneft.
“The company doesn’t have such money ($1.9 billion) on its balance sheet, and consequently if it loses the case it will have to either borrow or seek money from its subsidiaries,” Promsvyazbank analysts said in a note. (Reporting by Alexander Winning, Polina Nikolskaya and Zlata Garasyuta in Moscow and Sujata Rao in London; Editing by Mark Potter)