November 30, 2007 / 7:56 PM / 11 years ago

Russia's Altimo says MegaFon dispute resolved

MOSCOW, Nov 30 (Reuters) - Altimo, the telecoms investment vehicle of Russian billionaire Mikhail Fridman, said on Friday it had resolved a long-running dispute over its stake in Russia’s third-largest mobile operator, MegaFon.

The stake has been disputed by IPOC, a Bermuda-based fund, since August 2003, when Altimo bought a 25.1 percent stake in MegaFon for $295 million.

IPOC, which now owns a minority stake in MegaFon, said it agreed to buy the 25.1 percent stake before it was acquired by Altimo. IPOC has been fighting the Altimo-MegaFon deal in court for nearly four years, complicating MegaFon’s plans for an initial public offering.

“The legitimate ownership rights of Altimo for 25.1 percent of MegaFon shares will not be challenged by any of the parties,” Altimo said in a statement on Friday.

IPOC could not be reached for comment.

Altimo said the parties had agreed to end all court actions and renounce all legal claims against each other.

Other major shareholders in MegaFon are Sweden’s TeliaSonera AB TLSN.ST and Russian telecoms holding company Telekominvest.

The dispute resolution could help Altimo go ahead with a possible cash-and-stock deal to swap its MegaFon stake for a minority stake in TeliaSonera, which has long sought control of MegaFon.

Unlisted MegaFon has 35 million subscribers, lagging only behind Russian market leaders Mobile TeleSystems (MTS) (MBT.N) and Vimpelcom VIP.N.

REMAINING DISPUTES

“It’s another important step in Altimo’s firm strategy toward the resolution of all remaining disputed issues still existing between the shareholders of our investee companies,” said Altimo Chief Executive Officer Alexei Reznikovich.

Altimo’s parent company, Alfa, has been locked in a legal dispute with Norway’s Telenor (TEL.OL) over the direction of Vimpelcom, Russia’s No. 2 mobile operator, in which both have large stakes.

Telenor has been against Vimepclom’s expansion into Ukraine by acquiring Ukrainian RadioSystems (URS), a mobile operator competing with Telenor-controlled Kyivstar.

Telenor has repeatedly said it wanted a “divorce” from Alfa.

In recent months, Vimepclom has been the target of intensifying media speculation that it will seek to acquire fixed-line operator Golden Telecom GLDN.O, in which Alfa and Telenor own strategic stakes.

Analysts said the deal could also offer a path to resolving the dispute between Alfa and Telenor. (Writing by Maria Kiselyova; editing by John Wallace)

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