The English commercial court ruled that Vimpelcom will be able to go ahead with its shareholder vote on an equity issue to finance its takeover of Wind Telecom, but the company will still have to await the outcome of separate arbitration proceedings before issuing any new shares. Vimpelcom said in a statement that the court rejected Telenor's request for an injunction suspending the extraordinary shareholders meeting until its arbitration claim is settled. Telenor, the second-largest shareholder in Vimpelcom, claims it has pre-emptive rights on any new shares issued, and is seeking to avoid dilution of its stake. Vimpelcom management and the company's largest shareholder, Russian investor Altimo, have disputed the claim and supported the takeover. As a result of the court ruling, the shareholder vote will go ahead on 17 March. However Vimpelcom gave undertakings to the court that if Telenor wins the arbitration case, the Norwegian company will receive the pre-emptive shares, and that Telenor's stake will not be diluted below 25 percent plus one share in the time between the closing of the Wind deal and a ruling in the arbitration case. The court rejected a request from Telenor to have the pre-emptive shares put in escrow pending the outocme of the arbitration case. Telenor said it was pleased with the undertakings and remained confident of winning the arbitration ruling.
VimpelCom, Altimo, Telenor and Weather also gave undertakings to the court that if Telenor wins the arbitration case, it will be awarded damages in the amount of lost dividends on the pre-emptive shares, which amount can be set off against the cost of buying the shares. Additional undertakings valid for one year from the court ruling include: Altimo agreed that it would not to take any action that would cause Telenor and Altimo's combined voting percentage in VimpelCom to fall below a simple majority; Telenor agreed that it would not transfer its VimpelCom shares; and VimpelCom, Altimo and Telenor agreed not to undertake any acquisition, share issue or other action that would dilute Telenor's stake below 25 percent or that would cause Telenor and Altimo's combined ownership to fall below a simple majority. VimpelCom, Telenor and Altimo also agreed to enact stop-orders on Telenor and Altimo's shares on VimpelCom's share register in order to ensure compliance with the agreed transfer restrictions.
